Trump's Big Week: Middle East Trip, China Deal, Pharma EO, "Big, Beautiful Bill" with Ben Shapiro
Speakers
Ben Shapiro
— Co-founder, The Daily Wire
David Friedberg
— CEO, The Production Board
Chamath Palihapitiya
— CEO, Social Capital
Summary
The All-In hosts Jason Calacanis, Chamath Palihapitiya and David Friedberg are joined by guest Ben Shapiro to cover Trump's Middle East trip, the US-China tariff truce, the House reconciliation bill and the executive order on drug prices. The conversation is heavily macro: roughly $2 trillion of announced Gulf investment commitments and a commerce-first American posture in the region, tariffs cut from 145 percent to 30 percent with investor uncertainty still unresolved, and a long argument that the bill does nothing about a $2.5 trillion annual deficit while the 30-year Treasury yield approaches 5 percent. It closes with Friedberg's rant against state bans on cell-cultured meat and a detailed breakdown of international reference pricing, pharma R&D economics and the PBM middlemen.
- Trump's Gulf trip produced roughly $2 trillion of announced investment commitments, large Boeing aircraft orders, an AI inference data center deal in Saudi Arabia and the removal of Syria sanctions.
- Ben Shapiro supports the commerce-first posture but wants strings attached, is more skeptical of Qatar than of Saudi Arabia and the UAE, and calls the Gulf the best place in the world to deploy new capital.
- Chamath frames tariffs as the on-ramp to an American version of Belt and Road built on as many bilateral deals as possible.
- The Geneva deal cuts US tariffs on China from 145 percent to 30 percent and Chinese tariffs from 125 percent to 10 percent; Friedberg argues regulatory parity and market access matter more than the headline tariff number.
- David Friedberg calls the House tax bill a fiscal failure: about $2.5 trillion of annual deficits, roughly $37 trillion of debt, a 30-year yield near 5 percent and a self-reinforcing debt death spiral.
- Chamath counters that America should monetize its balance sheet through federal land leases, drilling royalties and private partnerships rather than aggressively cutting entitlements, while agreeing on no new programs.
- Friedberg defends US LNG exports on global demand growth and lower-emissions grounds; Shapiro says solar will not replace LNG anytime soon and that energy scale underpins the AI race.
- On the drug pricing executive order, Chamath cites research showing pharma profits could fall 20 to 27.5 percent under reference pricing and warns R&D shifts toward China's booming clinical trial base, while he and Friedberg point at PBMs as the larger cost problem.
Ideas
Gulf is best place for new capital
Shapiro says that if you are looking for a net new place to put capital to work, there is no better place in the world right now than the UAE and then Saudi Arabia. His reasoning: the region has shifted from ideological conflict to commerce-first dealmaking, Trump just locked in roughly a trillion dollars of two-way investment and defense commitments with Riyadh and Abu Dhabi, and NBS has transformed the Kingdom. He also argues investors are sanguine about Saudi Arabia precisely because it is a very wealthy kingdom that does not have to worry about the next election or the next policy thrown out for public consumption, which is the opposite of the policy whiplash investors face in the US. He is markedly less enthusiastic about Qatar, whose funding of Hamas and lobbying he treats as a real risk.
Debt spiral pushes long-bond yields higher
Friedberg argues the House reconciliation bill yields no real change in the annual deficit, which could keep running at about $2.5 trillion a year on a roughly $28 trillion economy, or 8 to 9 percent of GDP. The market is already repricing that: the 30-year Treasury yield is kissing 5 percent, and on about $37 trillion of debt the US is paying close to $2 trillion a year in interest as the debt refinances, roughly 7 cents of every dollar transacted in the country. His mechanism is explicit: buyers stop owning treasuries once they question whether the government will meet its obligations 30 years out, even a marginal doubt pushes yields up 1 to 2 points to 6 or 7 percent, which raises interest expense, which widens the deficit again. Doge-scale savings of under $300 billion a year cannot fix it, and Congress is not acting.
Debt forces dollar debasement or austerity
Shapiro says nobody is willing to make the systemic changes to Medicare, Medicaid and Social Security that the arithmetic requires, incremental increases in the top tax bracket cannot close a gap this size because all net taxes are already paid by the top quintile, and Americans are completely addicted to government sustenance. His conclusion is that in five to ten years there are only two outcomes and no third choice: the US wildly inflates its currency or it goes into massive austerity. He ties that directly to de-dollarization, asking why anyone would keep investing in the American dollar if they doubt the government meets its obligations.
US LNG exports should keep expanding
Friedberg makes an explicit economic case for US liquefied natural gas. Energy, heating and power demand is growing globally with or without the United States, and the US is already the largest exporter of methane, with pipelines feeding Gulf Coast liquefaction plants and cargoes shipping to India, Taiwan and Japan for heating and electricity. Methane burned for electricity emits about 60 percent less carbon than oil or coal, and because the US regulates leaks more tightly than rival producers it is the cleaner supplier; if America does not serve that demand, dirtier producers will. He therefore argues the US should remain and expand as an LNG exporter, which is also one of the fastest ways to monetize federal land and resources.
Price controls squeeze fragile pharma profits
Chamath argues the most favored nation drug pricing executive order lands on an already fragile industry model. Citing a detailed NBER study of international reference pricing, he says referencing a single country changes US prices only about minus 2 percent and a basket can actually lift pharma profits slightly, but a required like-for-like comparison cuts industry profits about 20 percent and using the full US bargaining framework cuts them about 27.5 percent. Against that, average broad-based pharma ROI was only about 1.5 percent as of 2022, and the average trial cost went from roughly $250 million in the early 1990s to about $2.3 billion today as a thousand regulations became 150,000, so further compressing profitability most likely pushes R&D to other jurisdictions. He adds that pharma captures only about 9 percent of the healthcare dollar while administrative complexity takes 30 percent, pricing failures and PBMs 20 percent, overtreatment 10 percent and fraud and abuse nearly 10 percent, so the order squeezes the smallest slice of the value chain.
China's trial boom rivals Western pharma R&D
Chamath shows clinical trial enrollment data for China versus the United States and says China completely reformed its trial procedures a few years ago, which produced an explosion in trial volume well before this executive order. China now runs roughly as many clinical trials as the US and they are often larger, so the amount of innovation and the surface area there already exceeds what is happening in the West. His downstream point is that if US pricing policy compresses Western pharma profitability, R&D migrates toward that Chinese base, making China the structural beneficiary of American drug price controls.
Drug price caps kill pharma R&D
Shapiro argues the MFN order attacks the wrong end of the problem: the US patents the drugs and then sells them at discount prices into nationalized foreign health systems, so the correct lever is tariff-style pressure on Canada, Mexico and the EU to pay their fair share, not capping American prices. Applied to Medicaid, he expects manufacturers simply will not sell into the program, pushing volume into the private market so that privately insured Americans end up paying more than they otherwise would; the balloon is squeezed in one place and inflated in another. And clocking pharma profitability is, in his words, a great way to kill R&D, because the public only sees the winners while the vast majority of biotech and startup pharmaceutical companies spend billions and crap out at phase three.
PBM middlemen profits face regulatory removal
Friedberg says the most removable cost in the US drug chain is the pharmacy benefit manager layer. Three firms, CVS Caremark, Express Scripts and Optum Rx, sit between insurers, pharmacies and manufacturers and make on average about three dollars of operating profit per prescription claim processed, earning money on markups and spread taking while obscuring the true cost of drugs, and they are allowed to be owned by the payer itself. The FTC has had several open cases between 2017 and 2022 and estimates these companies generated $7.3 billion in excess profit by marking up specialty generic drugs. Taking the PBMs out of the market would solve one of the biggest problems in drug pricing, which makes that profit pool the part of the chain most exposed to this executive order and to regulators.
Up Next
This All-In Podcast video, published May 17, 2025, features Ben Shapiro, David Friedberg, Chamath Palihapitiya discussing UAE, KSA, TLT, UUP, US LNG exporters, UNG, XLV, Chinese biotech, Biotech stocks, Pharmacy benefit managers, CVS. 8 trade ideas extracted by AI with direction and confidence scoring.
Speakers: Ben Shapiro, David Friedberg, Chamath Palihapitiya · Tickers: UAE, KSA, TLT, UUP, US LNG exporters, UNG, XLV, Chinese biotech, Biotech stocks, Pharmacy benefit managers, CVS