The Weekend Leverage
Trump has remade tech markets
I celebrated the Fourth of July, American independence, by slowly liquifying my brain courtesy of the “Big Beautiful Bill.” It is a turducken of a piece of legislation. It is simultaneously a personal insult to Elon, wrapped in a budget for the U.S. government, encapsulated in a remake of the global world order. It has serious, long-term implications for what happens in tech (and the households finances of millions). We’ll get to that.
But first, this Weekend Leverage is brought to you by the always tasteful Notion.
One of the biggest frustrations of modern work is having to use 16 different software applications a day. I always find myself losing track of which info is where. That’s why Notion’s Enterprise Search has been so damn useful. I just put in my question, and then Notion AI searches across Gmail, Box, and other apps I use to find the answer. I recognize this sounds too good to be true, but somehow it actually works. The result is a product that saves me a significant amount of time and improves the quality of my writing. It's a glimpse of the future of work—faster, smarter, better.
MY RESEARCH
Is the Figma IPO an opportunity for generational wealth? Figma is one of the best software companies on the planet. Their metrics are strong, their story perfectly timed to percolate investor excitement; they even have tens of millions of dollars worth of Bitcoin in reserve, to give crypto people their jollies. That’s all well and good, but is it a stock worth buying?
THE BIG STORY
Trump remakes the world: Look, I don’t like writing about politics. You don’t like reading about politics. Your innards are probably tightening up and your finger is inching ever closer to opening up Instagram. Don’t! Stay here, because this 900-page fever dream of a bill is going to end up shaping the world for the next decade. There are hundreds of little crags and corners of this bill, but here are the things that matter if you care about technology.
1. Power and clean-energy incentives
What changed: The bill sunsets Inflation Reduction Act wind, solar and EV tax credits by 2027, stripping the 30% subsidy that has underpinned most new renewables since 2022.
Implication: With cheap green power harder to lock in, data-center, AI-training, and semiconductor fab projects face materially higher electricity costs and may shift future builds to lower-cost grids or on-site generation. I expect Saudi Arabia to be a large beneficiary here with its structural advantages for providing cheaper energy. Tesla and other EV manufacturers will have a much harder time selling their vehicles without the generous subsidy that often would amount to over $5,000.
2. R&D incentives
What changed: Domestic research costs can again be written off in the year incurred (retroactive to 2022), reversing the five-year amortisation rule.
Implication: Start-ups regain a valuable payroll-tax offset. This will immediately provide a boost to the software engineering market. This is great! The Leverage is a publication devoted to all things that advantage start-ups. We will need to wait for the IRS to weigh in here, but I am also pretty sure that this means that AI training runs qualify as R&D expenses and can be written off in the year they are performed. This is a big deal—model runs are expected to cost tens of billions of dollars over the next two years. You can expect much more expensive models to be trained by big tech—it will help reduce their tax burdens!
3. Semiconductor-fab credit
What changed: A 35% investment tax credit now applies to any U.S. fab that breaks ground before 2026, up from 25%.
Implication: The sweeter credit materially lifts project rate of return, sparking a 2025-26 land-rush for talent, equipment, and construction crews around U.S. fab sites. TSMC, the world’s most important semiconductor fab company, shifted capital away from Japan to the U.S. to take advantage of this within 24 hours of the bill being passed.
4. AI regulation
What changed: The Senate stripped a House clause that would have federally preempted state AI laws for a decade.
Implication: Tech companies must navigate 50 different compliance regimes, slowing nationwide launches, and raising governance costs for models and algorithms. This hurts start-ups and will end up making California the de facto AI regulator for the United States because all the AI companies are headquartered there.
5. Deficit and debt service
What changed: The Congressional Budget Office projects the package will add roughly $3.4 trillion to national deficits over 10 years, pushing annual interest payments above $1 trillion by 2034.
Implication: Future generations pay for the monetary sins of today. The bill increases the risk that the dollar will slip from its place as the world’s reserve currency and that America’s greatest asset, its financial markets, could lose their potency. Not a sure thing, but the risk is much, much higher.
Phew. There is so much more to the bill, but these are the changes that are central to the mandate of The Leverage. If you made it this far, here is a cute picture of my dog as a reward.
TASTEMAKER
An essay that always makes me laugh till my face hurts: This was an exhausting week of news, and so I thought I would share the Prozac of prose: A 2015 post from Vice in which a man discovers that the song “The Boys are Back in Town” is on the jukebox at his local bar. He also learns, to our collective delight, that the bartender has no way of changing or stopping the song on the jukebox, and that he can play it until his wallet runs out of quarters. Read this, it’ll make you feel better.
Until next week, my friends. Paid subscribers to The Leverage can look forward to two paywalled essays this week containing my best and most in-depth research. You can upgrade below to get them in your inbox.