The AI Job Crisis Andrew Yang Saw Coming

When you run a business, you want the right tools. Enter Shopify. Shopify is the commerce platform behind millions of businesses around the world, from household names to brands just getting started. With hundreds of ready-to-use templates, Shopify helps you build a beautiful online store to match your brand's style. So if you're ready to sell, you're ready for Shopify. Turn your big business idea into... with Shopify on your side. Sign up for your one euro per month trial and start selling today at Shopify dot NL. Go to Shopify dot NL. That's Shopify dot NL. Power your business with the platform trusted by millions today. Burnout at work is a tale as old as time. Tale as old as time. But a new generation may have found the fix. We can learn so much from Gen Z and what they are teaching us about modeling the boundaries that would have prevented all of us from burning out in the first place. How to win the battle against burnout. That's this week on Explain It To Me. Find new episodes Sundays wherever you get your podcasts. What are the biggest threats we face today? And the reason we call it Everything Everywhere All at Once is because the idiosyncratic nature of the threats. I'm Preet Bharara. And this week, NYPD's Deputy Commissioner for Intelligence and Counterterrorism, Rebecca Weiner, joins me to discuss the evolving nature of terrorism and targeted violence. The episode is out now. Search and follow Stay Tuned with Preet wherever you get your podcasts. Today's number, 193. That's the age of the world's oldest animal, a tortoise named Jonathan. A true story. I worked at a zoo for several years where my job was circumcising elephants. The pay wasn't very good, but the tips were huge. Listen to me. Markets are bigger than us. What you have here is a structural change in the world distribution. Cash is trash. Stocks look pretty attractive. Something's going to break. Forget about it. How are you, Ed? I'm doing well. So 193. Would you want to live to 193? I don't want to live to 93. I think about being serious. I think about the end a lot. I've got the drugs picked out. I know where I want to die. I know the people I want around me. I spend a lot of time curating those Apple stories of my kids and friends. I'm going to live my life again. I'm going to play all of those videos on repeat. And I'm going to trip. And I already know who I want to come visit me. And then I'm going to peace out. I'm going to overdose. I'm going to go fucking crazy on heroin, which is supposed to be amazing, by the way. Are you being serious about the heroin? I know you're serious about all the other stuff. I do think at the end of your life, I don't see a problem with really maxing out on Tom Petty and heroin. Ed, speaking of heroin and interventions, property markets is going live. We're already in some cities. We're already 60% sold out, and this is after four days. So if you're interested in seeing us in either New York, Miami, Chicago, San Francisco, or L.A., please go to PropGMarketsTour.com and get a ticket. And also, if you're a friend of mine, pretend you're a fucking grown-up and get your own ticket. Seriously. People are calling me and saying, reserve me two tickets. It goes for my friends, too. Reserve me two tickets. And I send them the URL. And they're like, oh, I have to buy tickets? I'm like, don't you make like $7 million a year? buy a ticket for god's sakes anyways uh 100 but but i love my friends and i'm hoping to see them there uh but anyways we will sell out these tickets are selling faster i think than the last tour i was on so it's a lot of fun uh live podcast who would have thought it they actually are a good time we are going to have great guests uh so we're super excited about that's a bunch of surprise guests, very famous, iconic, interesting people in great cities. So come out. Ed and I will likely host an after party. That's right. We will raffle off all of Claire's quince wardrobe in a fundraiser. So we're very excited. We're going to have all sorts of things. We're going to have magic tricks. We're going to have the Rockettes are going to do an appearance. I don't where I got that. Did I tell you I dated a Rockette when I first moved to New York, Ed? That's crazy. That's awesome. Yeah. Congrats. I've seen the Christmas Spectacular like three times. I'm the only Jew that's seen the Christmas Spectacular numerous times. I love that. Yeah, I'm very excited too. We're going to be heading to San Francisco, Los Angeles, Chicago, Miami, New York. It's going to be great. I'm shocked by how many people have been telling us and getting mad at us for not going to Denver. I did not have that on my bingo card. So we'll go to Denver next time. But those are the cities, five cities. Very excited. Go to ProfGMarketsTour.com to get your tickets. Let's talk about GDP and AI, Ed. One of the biggest concerns around AI is its potential impact on the labor market. And so far, the data isn't very encouraging. Last year, companies attributed roughly 55,000 layoffs to AI and unemployment for recent college grads rose to 5.6%. That is the highest level outside the pandemic in more than a decade. Andrew Yang has been making this case for years. Before ChatGPT was even released, he warned that automation and AI would displace millions of workers. In fact, his 2020 presidential campaign was centered on this very idea. And back then, he proposed the freedom dividend, which would give American adults $1,000 a month as a way to soften the economic blow. Now, as those concerns begin to actually play out, we wanted to revisit the conversation with one of the earliest voices on this issue and ask what he thinks we should do next. So here is our conversation with Andrew Yang, entrepreneur, author, philanthropist, nonprofit leader, and former 2020 presidential candidate. Andrew, great to have you on the show. So you ran for president. I mean, you started this campaign, I believe it was actually in 2017. 2018 is when it really got rolling. And the central premise was that AI would eliminate millions of jobs, and automation and robots in general would also play into that thesis as well. A lot of people said that you were being alarmist. A lot of people said that it was kind of doomerish speculation. Now we're seeing that that is kind of the labor market issue of our time. I just want to start with this. How did you predict this? And why were you thinking about this? What was it seven years ago? Thanks for having me, Ed and Scott. Yeah. How did the magical Asian man from the future get so much right back in 2018. I had friends in Silicon Valley, as I know both of you do, and they told me AI was in the pipeline and that eventually it was going to do a number on call center jobs, retail jobs, eventually truck driving jobs. And I knew that they were right. I then asked them, look, how many of you want to say this in public? And back and none of them did, really. And so I thought, you know what, let me try and raise the alarm. In my view, the reason why Donald Trump became president back in 2016, which is what got me into the public realm, was that we'd automated away millions of manufacturing jobs that were based in Pennsylvania, Wisconsin, Ohio, Michigan. And to me, that technological automation wave was just gathering steam and was going to get stronger and stronger over time. And now we're seeing that manufacturing jobs are continuing to decline. We saw net job loss in the manufacturing industry last year. You said that people in Silicon Valley didn't want to talk about it publicly, and you asked them to. Why did they not want to talk about it? Well, a lot of them were starting businesses that had very compelling projections based upon displacing workers. And no one wants to come out and say, hey, invest in my company, you'll be able to fire everybody. I mean, that makes everyone seem like a jerk. And so when asked about it back then, they would say, we'll find new things for these people to do. It'll be a shift in roles, but it won't result in wholesale layoffs. And that was the party line, even though the business plans said something different that was closer to the reality we're seeing. So then ChatGPT comes out in 2022. How did you react to that development? And how do you think that kind of changed this whole narrative? Well, geez, I mean, like everyone else, you tried it out and subscribed and downloaded and you saw all of your friends and colleagues do the same. And it was like a light bulb going off for many, many people where they saw that large language models were going to change the way a lot of people lived and worked and unfortunately dated, which Scott has talked a lot about, though I don't think ChatGPT, well, I mean, maybe ChatGPT itself is a lot of people's boyfriend, girlfriend at this point. Too many, yeah, and increasing. And as flawed as that first model was, I also knew it was going to get much, much better very quickly. So now that when we look at the data today that we're seeing, I mean, last week, Oracle laid off 30,000 workers. We've seen layoffs from companies like Block, companies like Pinterest, Amazon, and a lot of them are flat out saying, we're doing this because of AI. I mean, there's a lot of nuance that we could get into here, but I just want to start with your reactions to some of those more recent layoffs. What do you make of those layoffs, and do they make you concerned? Oh, yeah, we should all be concerned. Even though it is true, that a lot of these announcements are not entirely accurate in terms of attributing the layoffs to AI. I think the term now is called AI washing, which Scott's what I talked a lot about, where let's say you overhired or you made some mistakes and you have to lay off a few thousand people or whatever it is. If you blame it on AI, then you seem like you're on it and savvy and just doing what the business requires and you didn't make a mistake in the past. Now, I think that there's a combination of things going on. But one of the reasons why I've been on this for so long is that I have private conversations with people all the time, as I think you guys do too. And one of the combos I relate to people was with a CEO of a publicly traded tech company who told me flat out, we're going to fire 15% of workers this year. We're going to fire another 20% two years from now, another 20% two years later. his direct quote was, I have no idea what my kids are going to do because his kids actually see what he's doing and were like, oh, I don't want to try and work for that company. That's not in the cards for them. So that CEO had no reason to lie to me over dinner. I mean, there was not like, hey, I'm going to say this to Yang and then go do something else. I mean, he was confiding in me and he's not alone. There have been maybe a dozen CEOs that've had very, very similar conversations with. So on that basis, you can see where this is heading, even if some of the current announcements aren't exactly accurate. I find that clarification so helpful because I feel as though the AI washing story, while it may be true, it does seem relevant that at the very least, these companies are trying to get rid of their workers. I mean, even if this exact round of layoffs, that those people haven't been directly replaced by AI, what is very clear is that from an executive perspective, the goal is to do that. So they're doing it now, and they're going to figure out whatever they can to continue to do that moving forward for exactly the reasons you just described, which I think is a very relevant piece of, I guess, anecdotal data. I'll have more questions, but I'm going to pass it to Scott. If I didn't know about AI, I wouldn't know anything unusual is happening in the labor markets. And I would take, you know, for the purpose of the discussion, I'll take the other side of this. And that is with every technological revolution, there's a fear of job destruction. And there sometimes is some short-term job destruction, but ultimately adds more jobs. And I don't see if you didn't have the narrative of AI washing as you're talking about, I think tech laying off people is somewhat about productivity gains with AI and other things, but mostly just about overhiring during the pandemic. But we haven't really seen unemployment spike. It's at about 4%, which is historically low. If in fact, AI was replacing workers to anything resembling the narrative, you'd have rising unemployment, falling job openings. What you see right now is sort of a no hire, no fire. And hiring is slowing, but it's definitely not collapsing. And then we're seeing productivity gains from AI, but it looks like it's the biggest ones for junior workers and routine knowledge workers. But it looks so far like it's being used to augment workers' productivity, which ideally would lend itself to higher wages. And we're still seeing the healthcare, construction, education, and services sector adding jobs. So I guess what I'm, I just, to be blunt, I'm calling bullshit on this narrative that it's interesting. It gives cloud cover for layoffs, but where's the actual evidence that AI is destroying jobs? Well, there are a couple of data points I would home in on. Number one is that the labor force participation rate keeps on dropping, where you've had at least a couple hundred thousand Americans raise their hands and say, I'm not even going to look anymore. And so the unemployment rate misses that group. Placement rates have collapsed for particular populations, particularly computer science grads coming out of various universities, where you had programs that had placement rates of 94% at high salaries. And those have flipped. Now you have computer science grads. By the way, I ran into a computer science grad out of UCLA, Scott, which is an awesome institution. And he was not able to find a job and was doing odd jobs in Uber to make ends meet, which would have been unthinkable. I mean, that's a great program, very, very bright kid. and he was looking for six months and was probably getting AI-fueled responses. I mean, like at this point, applying for a job often can be like bot-to-bot sort of thing. So you're seeing a couple of populations that are getting very, very adversely impacted. And what CEOs say to me, as they say to you, I'm sure, is the easiest people to fire are the people you haven't hired yet. So when you talk about this slow to hire, slow to fire, there's like a ladder being pulled up, I suppose, for a lot of entry-level workers that would have shown up. I think I saw one stat about the number of recent college graduates that are getting hired into various tech companies where it used to be double digits and now it's dropped to single digits. So to me, that population is the canary in the coal mine. And if you play out what happens that population over time. Unfortunately, their school loans don't get forgiven. They get sent home. I met some of these kids. I'm sure some of them reach out to you all the time. And the question is, what happens for that generation? Meanwhile, you have the middle managers who are all freaking out and stressed. And you can argue, look, some of them are getting laid off because of various excesses. But the 30,000 Oracle workers that Ed talked about got laid off. Maybe they didn't get replaced by AI, but Oracle is making a $50 billion bet on AI, and it needed the money. It looked up and said you know what if we cut these workers we going to save billion and we just going to plow that into data centers The amount of money that we spending on building data centers just surpassed the amount of money we spending on office buildings for the first time So you can see very literally that the compute infrastructure is the new human being. You tend to be more right than wrong on stuff like this, and you are definitely ahead of the curve. So let's assume that we do start to see this type of labor destruction. Can I just jump in, Scott? Do you disagree? I mean, where do you stand now that Andrew has said what he said here? Like, do you disagree that this is a problem for young people? Yeah, I disagree. I think that it's in every major technical revolution, whether it's automation that was supposed to was going to decimate the global auto industry employment or the PC, there's always a reconfiguration. There's always labor destruction. It's terrible for the people who are affected. I don't mean to diminish it, but I graduated into a recession and more than half of us didn't have jobs. And now the unemployment rate among youth is at four and a half is at 10 percent, which is high, but it's about average historically. And I see all sorts of new startups and interesting jobs from AI. So I'll absolutely take the over under on this, that there's a there's a V and then it rips back somewhat every other technical revolution. So I'm on the other side of this argument. Andrew, can I hear if you have a response to that position? Well, the thing I like about Scott is he's open-minded to what the evidence brings. Yeah, I might be wrong. Yeah, yeah, exactly. Like, this is something we're very clearly, we're going to see it play out. I'm, by the way, very confident on my side of this argument. But, you know, like, obviously, you know, Scott's a smart guy who will just see what the facts bring. And I'm like a thousand percent comfortable with that. I mean, that's a lot better than the dogmatic version where some people, including folks who are in AI, who, in my opinion, are trying to provide air cover for themselves, but also some economists that I feel like aren't super honed in on whatever the signals are. I don't talk to industry very much where they tend to make arguments that I have a much more negative reaction to because it's like they'll harken back to literally century-old fact patterns and examples. And it's like, wait a minute. Are you really comparing AI to the Industrial Revolution? Yeah, horse and buggy. It's like that sort of thing that never makes sense to me. My favorite is elevator operators. We used to have those. Yeah. But just to, Andrew, the overlap here and where I think we both agree we want to work together is regardless of we know I'm I think most people would say there's going to be a V here. There's going to be a lot of short term pressure on on information workers at a junior level, services workers. So we can have empathy for them in regardless of whether how severe it is. And we're all in idiocracy on our couch is watching Netflix all day and we need to distribute money to everybody or this revolution. Or this is just another cycle that plays out similarly with different nuances, other technical revolutions. The question is, it would make sense, for example, and I want to use this to lead into hearing your policy solutions, to do what Denmark or Norway does and spend more money on worker retraining, regardless of the industry that's under pressure. Right. We're not good at that. We're really bad at letting the market recalibrate and letting winners be winners and losers be losers. But we're terrible at is taking care of the workers on the wrong side of the trade. similar to, and I think other nations do a better job of this. So worker retraining, what are some of the policies? Let's assume that it's somewhere between what I think and what you think, just for shits and giggles. What would the policy recommendations to prepare for a scenario that might be somewhere between what we're talking about and a worst case scenario that you would want to recommend? Yeah. So Scott, eight years ago, if you asked a political figure that question, And they would 100% say, we have to train Americans for the jobs of the future. And then you pointed out we're terrible at that. And I looked up the studies as to how effective government-funded retraining programs were. And the efficacy range I found was 0% to 15% with 15% on the high side. what happened in michigan was that an enterprising soul started a school to certify all these laid off manufacturing workers and business skills collected the government money and then shut down and everyone had these valueless certificates and it didn't do shit i mean that that's what we did in the past so that was a talking point i think they literally might have said learn to code back eight years ago and now that's obviously right or learn mandarin yeah yeah yeah really stupid and i think that the retraining aspect uh is chasing moving goalposts and my joke is that i'm now past 50 so if i don't get dumber or slower in a given month it's a good month whereas ai is going to double in power and efficacy in that month so so trying to train workers who've been laid off in various jobs to compete against AI strikes me as a loser. It strikes me as like the next generation learned to code or we're going to retrain the laid off manufacturing workers. So that's not great news, obviously. One thing I think you could argue for that most people would accept is some kind of subsidy or incentive to hire a young person out of schools where you could have entry-level workers, you get a tax break or some kind of match and credit or incentive to take on a young person. And the great thing there is that after the young person's in your organization, then they can become awesome and contribute. And you might not have hired them initially, but maybe the government can assist you on that level. That to me is a sensible policy, and I've actually advised various policymakers on that. They haven't done anything with it. One of the reasons why I was so pro-universal basic income and still am is that it will fill in the gaps. We're bad at retraining. We're going to be bad at targeted policy. Political figures are great at talking about it and not doing it. No one will actually see what happened to the displaced workers. So if you were to take an AI dividend, and at this point, there are a lot of folks in AI who are arguing for a version of this, and just start distributing it to workers of any age and stage, it would 100% facilitate with successful transitions, with people being able to switch fields or switch jobs or switch regions or whatever it takes. And so I'm still Mr. Let's distribute the money as quickly as we can, especially now that AI has minted or is in the process of minting several trillion dollar companies. And there hasn't been meaningful tax on any of it. I'm not surprised that you're still an advocate for UBI. And that's where this sort of these roads ended up to. But I want to go back to the notion of worker retraining. I don't think it's fair to say that those efforts have failed. and to give up on it. My sense is, if you look at the economy, the number of data centers, nuclear power plants, healthcare, aging population, the specialty certification and everything from nursing to installation of energy efficient HVAC computers that only 3% of the U.S. LinkedIn profiles say apprentice, and it's 11% in Europe, that an apprentice culture and more vocational training that if we did it right, could have real ROI. And also, I worry, Andrew, that having a tax credit for youth, I would prefer just to have a lower taxation on lower incomes, which is the same as taxing the youth lower. I worry that what do you say to the 35-year-old single mother who wasn't in the workforce and is essentially going into the workforce entry level at 35? I worry that age-based tax basis is just not politically palatable or realistic. So can you respond to those two things? The worker retraining when done accurately actually might, in my view, be really beneficial and we don't have enough of it. And two, my sense of any sort of age-based discrimination around taxation, although I would argue we do discriminate in terms of giving old people money, but I worry that that would just not be politically palatable to start subsidizing at Elson versus, say, a 35-year-old who's entering the workforce for the first time. Yeah, so 100% agree with you on the need for technical training, apprenticeships, vocational, and revving that up. I think Germany is a role model in this dimension. We have a massive shortage of electricians and plumbers and HVAC repair. Those are resilient jobs. I say all the time that you're not going to have a robot plumber for the foreseeable because like sending a robot to your home and like that's just not a thing i mean so there's some people might disagree with me and so to the extent we can channel real life human beings to those roles and industries a thousand percent we should be de-stigmatizing the trades we have made them seem like somehow second-class citizens relative to college grads, and that's been a fiasco. As you can tell, I think that college grads are going to really take it on the chin on this one. So I'm so with you on the trades. And I'm also, you know, I'm a little bit surprised because, you know, obviously, like, I was in the green room when you went and did your TED Talk about how young people are getting shafted, and so I thought that that may be some kind of, you know, policy in that direction. Though I've not like I'm not disagreeing with you on the politics of it. That's one reason why I like universal benefits so much because everyone can see themselves in it and it's not as zero sum. We'll be right back after the break. And if you're enjoying the show so far, send it to a friend and please follow us on YouTube, Spotify, or wherever you get your podcasts. Thank you. But now that's changed. Today, our most innovative companies are staying private rather than going public. The result is that everyday Americans are excluded from investing and getting left further behind, while a select few reap all the benefits. Until now. Introducing VCX, the public ticker for private tech. VCX by Fundrise gives everyone the opportunity to invest in the next generation of innovation, including the companies leading the AI revolution, space exploration, defense tech and more. Visit GetVCX.com for more info. That's GetVCX.com. Carefully consider the investment material before investing, including objectives, rischarges, and expenses. This and other information can be found in the Funds Perspectives at GetVCX.com. This is a paid sponsorship. Thank you. Visit SoFi.com slash ProfG and see your loan options in minutes, all with no impact to your credit score. The SoFi Marketplace website is owned by SoFi Lending Corp. Terms, conditions, and state restrictions apply. CFL 6054612. NMLS 1121636. This is Advertiser Content brought to you by Virgin Atlantic Ed. a couple weeks back. I got you a birthday gift. Not to pat myself on the back, but it was a pretty good one. It was indeed. You surprised me with Virgin Atlantic upper-class tickets to London. So tell us all about it. It was pretty incredible. From the moment I entered that upper-class cabin, I have to tell you, I felt like a VIP. Anything I needed, a drink, snack, assistance with the seat. Flat seats. Flat seats. That's the key. Exactly. Had the four-course meal, got my champagne, very delicious, enjoyed the food. And the journey home? The journey home was great. I went to the Virgin Atlantic LHR Clubhouse, that's the Heathrow Clubhouse. Heathrow Clubhouse was awesome. Got myself a coffee, headed over to the meditation pod that they call the Soma Dome. Kind of felt like a sort of spaceship where you relax and think nice thoughts. So I did that for a little bit. Then we went over to the Wing, which are these acoustically sealed booths where you could do some work uh you could even record a podcast i didn't do that but maybe i should have it was a very enjoyable experience so ed the real question here is what are you planning to get me for my birthday see the world differently with virgin atlantic flying should be more than just transport it is part of the adventure go to virginatlantic.com to learn more tickets and lounge access provided by virgin atlantic we're back with prof g markets we're having these policy discussions and it seems that i i still feel as though in order to figure out what the correct policy is we need to be an agreement or at least some semblance of agreement on diagnosing what the problem is and so i i just go back to whether AI is indeed having a significant impact on the labor market. And I think one thing that I just want to point out and see if Andrew maybe have thoughts on is the fact that what we're really talking about here is the college graduate employment situation, where college grads, the unemployment rate for recent college grads is historically very, very high. And perhaps even And more interestingly, the unemployment rate for college grads is now higher than for non-college grads. And that never used to be the case. And I feel like that is relevant because, I mean, we say the young people are the canary in the coal mine. When it comes to AI, I feel like the more relevant thing to say is that young college grads are the canary in the coal mine, because that's the area of work where AI can actually have an impact. It's not really having an impact in terms of blue-collar jobs yet, but it is having a level of impact in the white-collar workforce We are seeing that in the college grad unemployment data. And then when we look at actual tech companies, whether or not it's AI washing, we are seeing data that suggests that jobs are being lost in that realm. And so I guess I just, I mean, it seems as though, yes, we haven't had a clear picture of data that tells us that, yes, AI has come in and completely transformed the labor market. But it seems like to the extent that AI is quite a nascent technology, it's doing all the things that you would expect if it were to do that in the future. and so i'm sort of waiting for someone to show me data that like no ai isn't doing all of the things that andrew yang had predicted it would do in over the long term point being we're not in the long term yet i just want to see if you have thoughts on that i mean certainly i'm totally with it ed like i mean i think it's going to be a shit show uh and the the thing that i'd liken it to is that when the robots started showing up on the factory floor in the Midwest, first before the robot arm showed up, a lot of manufacturing workers said, there's no way a robot could do what I do because I turned the screw just the way I turn it or whatever the heck the argument was. And then they got decimated. I think there were some arguments around the local journalists who you know there been of wipe out there of tens of thousands of local journalists when Craigslist and the rest of it came on And some people said oh it be fine And it wasn fine And on this one AI is to white collar work and the cubicles and the office parks, what the robot arms were, the factory floors. You just don't need as many whippersnappers making your PowerPoint decks and your Excel spreadsheets and like, you know, learning corporate lingo. And when you go into some of these large corporates, I mean, I'm a serial entrepreneur, Scott's a serial entrepreneur, and you're on your way. You can sense that there are a lot of people whose jobs are not super vital to the operations and growth of that business. I mean, if you set foot on a large corporate campus, there are people as far as the eye can see. And so what I say to folks is AI is to knowledge work what the robots were to factory work. Just looking at like those other previous examples, I feel like when this conversation happens, usually we look at previous technologies and we say, well, it ultimately ended up being a good thing. Like I feel like when people talk about robots being used in the factories, there's often like an implicit assumption that like, oh, it ended up being good for everyone. We created prosperity like it was a good thing overall. But I just wonder if we're kind of rewriting history a little bit. Oh, yeah, man. I'm going to make this case. So I had breakfast with a major company CEO who said his revenues have gone up threefold and he has cut 30 percent of his staff and it's going to get much, much worse. He says the more people I cut, the better we're going to do publicly traded company, richest balls. Like, again, no reason to lie to me. Actually, he came to me because he's starting to freak out saying, if I keep doing what I'm doing and every other CEO in my situation does what we're doing, we're fucked chaos in the streets. You know, my kids don't have anything to do like pitchforks are going to come out. So he came to me saying, we have to try and keep this from happening. I get those incoming calls from sane CEOs. And this guy, in my opinion, is remarkable because he actually gave enough of a shit to reach out to me and buy me breakfast. Anyway, Scott, it's someone you're probably buddies with, Scott. But when people approach me about this stuff, I don't spill the tea. Then I tell them what I'm working on and then we try and save the world. But I get incoming contacts like that you know every other day now and when we look at what happened let's say like let's use like the information economy as an example like transitioning into an into the information age which again i think a lot of people look at as oh that was a good thing like here we are things are good we have a prosperous society it's going to be great for the top line ed like you know that's going to be great for the top line but exactly and i look at what happened and i'm like well that's pretty much where the K-shape started. That's where we saw this massive divergence between the richest in America versus the poorest in America. That's where the wealth inequality thing started to get really out of control. And so I almost look at our transition to that period as like, I don't, I mean, people seem to think we got it right. I'm not sure that we did get it right. And it seems like the AI equivalent of that, the story is going to be the same thing except times a thousand yeah my argument would be that we totally did not get it right and that's how you wind up with a donald trump presidency twice not to betray my politics but that's not going to shock anyone who's like kept up with me like we we have fumbled it uh royally a time or two um we're about to fumble it royally again but this time it's going to do a number on entire generation uh and And it does upset me that, you know, I mean, I get these private conversations and we should be doing much, much more. We should be taking very big swings. I mean, I think that my campaign in 2020, some say I was ahead of the curve. I think I was pretty much right on time because if you can imagine us doing things differently from 2020 to now, we might be in position. But this is going to grow the revenues, the top line, the market cap of a bunch of these companies very, very significantly. And the CEO I had breakfast with, who's freaking out, he said three words summarize the situation. Capital displaces labor. And then he put in parentheses with the help of AI. but uh he's like now it's clearer to him than ever because his company is roaring in terms of performance and stock market price and he's cutting people right and left and it seems that that is now becoming kind of consensus among the leaders in ai the example first example would be dario amaday ceo of anthropic who's literally been saying this he's been saying it's going to wipe out half of entry-level white-collar jobs in five years. Again, some people would say that he's being a doomer. This is AI washing to sort of increase the value. But he also raised his hand and said, you should tax us, which is not something you ordinarily hear from CEOs. And he proposed a 3% token tax, which in my opinion would be too low. But it's a start. He raised his hand and said, hey, please tax us. And if you were to apply that across the ai companies you might actually be getting somewhere and open ai just did the same thing they published this what they're calling the new deal where they proposed an increase on capital gains taxes and a a new policy that addresses what we're about to see in terms of wealth inequality and figure out ways to redistribute the wealth i guess the point being like now the leaders in AI are kind of proponents of what you were arguing for in 2018. The same things that you said that they were not willing to speak publicly about. They used to be like, no, no, let's not talk about this. Let's sort of keep it under wraps. But now it seems like they're coming out and saying, actually, we're afraid of the pitchforks. We want to do something about this. We obviously just saw these attacks on Sam Altman last week, which we can get into as well. But CEOs in AI in Silicon Valley, a subset of them are increasingly saying, like, this is going to be a problem and we should you should tax us. Yeah, I mean, they saw the numbers. Their approval rating is down to 26 percent, which is lower than anyone else's. It's lower than ICE. And so they see the writing on the wall saying, wow, people really hate us. um what would make them hate us less at a minimum we should put forward some policy proposals as to how we can help people manage this time now are they sincere about actually implementing all those policies you know no it's like andrew i trust your intentions i'm going to try and be delicate about this you're talking about a group of people that would fuck their sister for a nickel and we We fall for this shit literally every couple of years. We have a new hero who says, regulate me in hushed tones and a T-shirt, Sam Altman. Or we should be worried about the future, income inequality, Jeff Bezos, UBI. And then they deploy thousands of lawyers to get in the way of any regulation. If we're waiting on fucking Dario Amadei to figure this out, good luck to us. We need people like Andrew Yang. We need public policy that actually has sane economic tax policies. We keep falling for this notion that some Jesus-like figure from the technology sector is going to tax himself. It's never happened. It's never going to. Your thoughts, Andrew? I don't disagree at all. Again, Scott. I mean, it's very easy for them to say tax me knowing full well it's not going to happen. And by the way, there is a congressional candidate named Alex Boris right now that the AI industry is spending millions submarining because he proposed some very sensible AI guidelines as a state legislator in New York. And they don't want to see that in Congress. So don't disagree one bit that they can say something and then count on the money to keep anything from happening in Congress. And sometimes they'll do it on the same day. So I know a lot of these guys reach out to you. In addition to, and there's like 80% overlap with what you're, you did normalize the notion. And I think this is, I think you had more impact than people acknowledge or are aware of because people just got used to the idea. You normalize the idea of, well, why wouldn't you just give people money? Why wouldn't you just lift people up? And that would be good for the economy, the multiplier effect, reduce anxiety in the country, the happiness, unfortunately, in this nation. is directly correlated to economic sustainability. Before it was like, oh, no, that's not American. And people are coming to grips with that. And I think you had a lot of I don't know, I think a lot of that was driven by you. So quite frankly, I just don't think UBI is politically tenable. But what might be politically tenable is universal safety net that everyone has certain rights to health care, access to child care. You know, I just don't think Ed Elson should be getting income. I don't think anyone on this call should be getting... It's the universal part that bothered me about your branding, that basic income works for me. If you were advising the next presidential candidate on a specific policy to try and level up, I wouldn't even say young people. I think it should just be people who are economically strained, because I think that's what you were trying to do, is to make a healthier, happier, more prosperous nation, the kind of nation that the values should reflect our prosperity. I'm not trying to put words in your mouth, but I know you fairly well, and I think you would agree with that. If you were advising anyone, you may be, of the 40 Democrats who claim they're not running for president, but will come on our podcast if I text them within five seconds, what would you suggest in terms of an economic policy that likely could pass, that the American public would embrace? Because my sense of UBI is it conceptually works, but I just don't think practically it's feasible. So just for a moment, if you had to calibrate UBI and advise a Democratic presidential campaign on what type of policies you would propose, what would those look like? Well, we called it the freedom dividend because it tested better, Scott. And we did run various numbers on various policies. I will say to you, not surprising, that while I was championing universal basic income and still do and believe in it, if we wound up with a negative income tax, I would be pumped because that would alleviate poverty at scale. It's a great idea. Yes. Great idea. Explain more about that. What is a negative income tax? It's that you have a certain threshold. Let's call it $35,000 or the poverty level or wherever you want to set it. and if you make less than that then we true you up to that level of it and if you make more than that then you know it's it's as it was um and so that's the sort of thing that uh i'd be thrilled with uh i'd be thrilled with a higher child tax credit i'm thrilled with anything that alleviates poverty um now i i enjoy the universal basic income universal anchoring because this country is so us versus them and divided. And it's like, oh, if you get it, then I'm mad about it. And so if you say, look, I don't give a shit about any of that. Like you're an American, you're a human being. Like, let's just go. You know, like we're trying to transition from scarcity to abundance. But if we landed on something like a negative income tax, pumped. Have you done any numbers on what that? Let's take that. $35,000. If you're a household income, $35,000, maybe every kid another $5,000. So two kids, $45,000. Yeah, yeah, yeah. I was saying $35,000 per adult individual. And then we'd show you up. I absolutely love that. Have you run the math on what that would cost? A negative income tax, depending upon where you set it, tends to cost in the hundreds of billions, like the middle hundreds of billions around that order of magnitude. But you would be getting a lot of that money back because you'd be putting it into the hands of the poorest Americans. They'd spend every dollar. Multiplier effect, yeah. Yeah, you would improve healthcare outcomes, educational outcomes, lower criminality, homelessness, etc., etc. the thing that is sort of on my mind when we think about what to do about all of this. I mean, I'd just love to get your reactions to what happened last week with these attacks on Sam Altman. It seems to be indicative of quite a dark place. And it seems that that might, it seems based on what you're saying about what CEOs are telling you, that that might actually be the impetus to create some of these more creative solutions and tax policies. I think people used to say like, no, that's ridiculous. No one will buy that. That seems crazy whenever you come up with these more creative policy ideas such as UBI. But it seems that now that there is this sort of lingering threat of violence, basically, that people are more amenable to more creative solutions, I guess, because the stakes are a lot higher. I wonder if you agree with that. It's enlightened self-interest, Ed. It's one of the things I'd say to the masters of the universe is that even if you're successful, you're less happy in a very unequal society. And I used to joke with people, it's like, no one wants armed guards around their kids. No one wants bulletproof limos. No one wants the Venezuela experience. Like, look, like this, this doesn't have to be about you being an awesome human being. It can just be that you'd rather not live in the bunker. So we're nearing that point. I mean, we all saw with the United Health CEO being killed on the streets of New York, like the anger is rising, the dysfunction is rising, the polarization is higher than it's ever been. And so even if you don't think these are tremendous human beings who just love other people and want to provide for them, I think a lot of folks see that this can be a way to make the environment actually open to innovation, because you become very, very anti-innovation very quickly if you think it's going to take your job, increase your power bills, and leave you on the outside looking in with your kid depressed in that home. I remember one of the things that you said when you were running the campaign back in 2020. You said something like, people in New York don't want to step over homeless people. That is not an enjoyable experience. Most people do not want to experience that. No one wants to see this level of wealth inequality. But at the same time, you mentioned some of those AI super PACs that we've been seeing. And the idea that Mark Andreessen would be bankrolling these AI super PACs, whose goal is to basically address this problem. And I don't, I mean, aside from maybe the Bernie Sanders AOC moratorium, I've seen mostly AI policies that are pretty reasonable, that get at the issues that we're describing. And then I see, you know, that those kinds of political actions combined with this sort of like techno utopia, paradise that a lot of these guys, this sort of Ayn Randian philosophy that a lot of these guys have adopted. I start to think maybe they do want private security guards in their own little cap. Maybe they do actually want to go off to New zealand and like live in their bunker like sometimes i struggle to believe that some of our leaders actually are united with us in believing that that would be a bad thing for america or at least are interested in preventing it from happening some of them seem to still not care but maybe i'm being pessimistic or not fair i mean i guess from your conversations with a lot of these people and having run that campaign what do you think is actually going through the head of a person like mark andreessen for example i can't speak for mark um uh he's not someone who calls me i don't know um there is a range some of them have already mentally flipped the switch and are heading to the bunker and could give a shit what happens to everyone else um some are still uh you know like they sometimes have kids who are in schools and they like their lives and they like being able to be on the street and not uh get tomatoes at them or the equivalent And so you know like it a split I will say the culture in Silicon Valley has gotten markedly worse over the last eight years since I ran. Like, I would attribute it partially to the binary nature of our politics, where they didn't like one side, so they threw in with the other side, and now they're trying to insulate themselves. uh it's darker than it was but there are still some totally lucid human beings who even if they're not driven by empathy and altruism like recognize that look some kind of investment in the general public would not be a terrible move and if only just to make them look better and to get people off their backs we'll be right back and for even more markets content Sign up for our newsletter at ProfGMarkets.com. And we're the hosts of The Long Game, a weekly national security podcast. This week, Trump's former national security advisor, H.R. McMaster, and deputy national security advisor, Matt Pottinger. Join us. The episode's out now. Search for and follow The Long Game wherever you get your podcasts. Secretary of Defense Pete Hegseth has been talking about the war in Iran in distinctly biblical terms, citing Psalms, the resurrection of Jesus, and the book of Quentin. And I will strike down upon thee with great vengeance and furious anger those who attempt to capture and destroy my brother. President Trump is comparing himself to Christ. Vice President Vance is fighting with the Pope. Watching all of this is the increasingly influential pastor Doug Wilson. He co-founded the church that Hegseth attends. Wilson's a Christian nationalist who would like the USA to be a theocracy. He'd also like to help us get there, though he doesn't think it's going to happen anytime soon. I believe that it is accelerating. I believe that we're making significant gains. I see assembling resources and I'm encouraged in that labor. But I don't expect to see what we're praying for in my lifetime. Pastor Doug Wilson and how much you should worry about his plans on Today Explained from Vox. Weekdays, afternoons, wherever. Immigration may be Donald Trump's signature issue. President Trump is now targeting predominantly Democratic cities for ice raids and deportation. Dozens of protesters clashing with immigration and customs enforcement agents in Minneapolis. We will begin the process of returning millions and millions of criminal aliens back to the places from which they came. But what we want to do in this space is talk about America and politics beyond the current president. So what do most Americans think about deportation and border security, period? I think that Americans are definitely against the kind of violent displays that we've seen in the street from ICE. When it comes to the question of deportation, the answer is more complicated. My sense is that people want order at the border. They don't like the idea of having no idea who's coming into the United States at any given time. The view on immigration from the bottom up instead of the top down. That's this week on America Actually, every Saturday in your audio and video feeds. We're back with Prof G Markets. How do you think you can be most effective coming into the midterms and with the presidential election? Are you trying to use your platform to advocate for certain policies where you get behind a certain candidate? What is your plan to try and have some influence over the next few years? Oh, my gosh, Scott. How do you even know I have a plan? No, I'm kidding. Of course I have a plan. I'm here to do as much good as I can. So first, I want to put a plug in for the backdrop. Some of you can see it, but I'm the head of a company called Noble Mobile that's trying to save people money right now on your wireless bills. And then we give you up to $20 back at the end of every month based upon any data you don't use. So it's even an incentive to doom scroll less, to maybe try and get a date where you're not on your phone the whole time. So that's a joy. And the reason we started Noble Mobile was that there are a lot of folks who like me and Scott who actually wanted their financial lives to be better now, today, and not based upon my being in office or being able to implement UBI or a lot of these things. So that's one thing I'm doing. Now, to Scott's question, in the bigger sense, I'm trying to help various good people get into office in November with a little bit of a different bent than a lot of other folks who do this work. So this morning I was on a call with a guy I'm supporting named Seth Bodnar, who's running for U.S. Senate in Montana. And the reason why it's unusual is that he's running as an independent. He's a former special operations commander in the U.S. Airborne. He graduated first in his class from West Point. So he's a stud. he was the president of the university of montana until a couple months ago where he said screw it i'm going to run for u.s senate and in montana a democrat would not be able to win but as a military veteran who's running as an independent by the way seth bodnar first month he raised more money than every other candidate combined including the republican and he's been endorsed by john tester. So if you can get someone like Seth Bodnar into the U.S. Senate, all Senate votes count the same. You could have like a sane, public-spirited, patriotic senator out of a traditionally red state in Montana. And so that's the kind of candidate I'm boosting and trying to help in the goal of rationalizing our politics come January of next year. And are there two or three candidates for president that you would be excited about? I'm not talking to one right now. There are two on this very call. Hey, Ed, how old are you? Are you not old enough to run yet? What's going on? Not yet. Not yet. And I wasn't born yet. Not going to happen. Oh, my gosh. Two strikes against you, Ed. We have to forge a birth certificate for you and age you up seven years or so or whatever it is. So, Scott, I mean, you and I both know a lot of this field. I think you were when when we were together, you thought a couple of the governors were kind of in the sweet spot. I tend to agree with you. I think a governor is a very good background for this because they've run a state, they've got that heft and gravitas, Americans know what that is and respond to it. And you can disavow yourself of all of the nonsense that's been coming out of DC for the last number of years. Andrew, just given our discussions here about what an AI future might look like, I know you have two sons. i'd be curious to know how you speak with them about all of this if at all um do you teach them about this stuff do you have thoughts on what it would take for them to succeed in an ai era and if you could remind us of their ages please do so as well so you guys are going to believe this maybe you will whatever uh first let me say i don't like i don't worry about my kids in the sense that my kids will have a lot more going for them than the average American family. And so let me put that out there. But my 13-year-old has come to me and my wife and said, I think I'm going to have an AI girlfriend, not a human girlfriend. And then we were terrified and said, why? And he says, because it's going to be a lot easier and I don't think I can get a human girlfriend. Now, my son is on the autism spectrum, but I think that he's very honest. We've been having him watch Love on the Spectrum of Netflix to try and boost him to the fact that maybe he can get a human girlfriend. The fact is a lot of our boys are going to fall into that kind of rabbit hole. And it's very much they're waiting for them to prey on them. And so we're doing our best to insulate our kids. I can't tell you how good a job we're doing. I just want to shout out Scott's colleague, Jonathan Haidt, for getting smartphones and social media out of a lot of these schools, because as a parent, it's real. You see that our kids are up against forces that we never were as kids. And childhood is hard enough if you don't have trillion-dollar companies trying to prey on your brain and your soul. What kind of strategies have you employed? I mean, what is your view on your children using devices using social media is a policy that you try to stick by or well they don't have phones they don't have social media accounts and uh i wish that they were on their screens less than they are i mean like that that's something that is uh failing and a problem and a source of tension in the house it's one reason why to me noble mobile is so positive is because we can try and help families. You can have your kid get a higher allowance if they use less screen time and things like that. But it's a problem. And I'm not going to pretend to be doing it great. We're not. We struggle. It's one reason why I want to help families. Is there any advice that you would give to any fathers in a similar position that might have children of your children's age? I mean, the best thing we can do is get them off screens and reading books, any book, any book, or sports team, outdoors, nature. I mean, a lot of this is just old school at this point. It's just human formation. And I'm happy to say the culture is turning on the screen. But if you show me a household where the kids aren't on screens, they have a much, much better shot at flourishing. Andrew Yang is an entrepreneur, author, and founder of the Ford Policy, best known for his 2020 presidential campaign, where he brought universal basic income into the mainstream conversation. He founded Venture for America, a fellowship that placed hundreds of entrepreneurs in emerging startup cities, and is the author of the New York Times bestseller, The War on Normal People. Today, he's the CEO of Noble Mobile, a wireless carrier that pays users back for using their phones less. His latest book, Hey Yang, Where's My Thousand Bucks? and Other True Stories of Staggering Depth, is available now. Andrew, we are such fans, and you know this, but I'm telling the audience now, I was an original yang ganger back in 2019 2018 so we're very much a big fan where's your tattoo where's your tattoo i'm i'm kidding well thank you to both of you you make me feel better about humanity and boyhood and manhood uh and our shared future and we'd love to do more together also anyone who's listening to this noble mobile.com slash yang you get three months off noble mobile and you just say that Prof G and Ed Elson sent you. There you go. Thanks, brother. Thanks, Andrew. Appreciate the heck out of you guys. Ed, I didn't know that. I always find out things that... You didn't know I was original Yang Gang? I did not know that. One of the first interactions that I had with you... Actually, it's the first interaction I had with you was with the first call that I made to you and I introduced myself. But I told you in our first meeting that I was a fan of Andrew Yang and you said, oh, well, that's great because I have a meeting with Andrew Yang next week and you can join me. So our second interaction ever was a Zoom call between you and Andrew Yang and me. And I sat on the sidelines sort of fanboying out with my two favorite thought fluences. And I just took notes and then I sent you a transcript of our meeting. but Andrew is a big piece of our of our origin story interestingly enough I had no idea I mean that was such an important moment I'm glad that you joined me and I remember none of that um but yeah that kind of zombran for you and I've known Andrew I remember he he reached out to me I think 2018 and said I want to come on your pod I'm running for president I never heard of him like no I'm not I'm not interested in entertaining these weird candidates and he did have a really positive impact, I thought, on the race. I didn't support him for president, but I supported him for mayor. And he and I have become friends. And Andrew is, people have a kind of a public persona, and they have a private persona. Andrew is absolutely as advertised. He is a super nice guy, super family man, incredibly optimistic, like sees the best in people. He's just this whirling dervish of energy, very positive. I have never heard him say a negative word about anybody. And he was being generous. I invested in his company. I like the idea of trying to get people off their phones. But I invested because of Andrew. I think the guy is just, you just want, he's the kind of guy that you want to win. You meet him. There's very few people to meet with Andrew and say, oh, I don't like that guy or don't vote for him. People meet him and go, his heart's definitely in the right place. I'd love to see him as a cabinet member, like maybe, I don't know, Secretary of Commerce or actually head of the Small Business Administration. He'd be great at that. Although the woman who ran the WWE is very qualified and doing a great job. Oh, is she small business? No, she's a Department of Education who's working on a1 thinking that was ai jesus christ cacostocracy ed cacostocracy cacostocracy that's right it is amazing though i mean all of the issues that he ran on he was he said that he was right on cue and i think that's probably true if our government really worked properly but now is the moment that that message is really going to resonate politically. I mean, suddenly, this issue is the political issue of our time. It is the thing that a lot of these different candidates are starting to rally around. It's the AI and automation issue. And suddenly, all of these politicians who kind of shirked off that issue for a very long time, they suddenly have to reckon with it. And they suddenly have to decide, okay, what is my position on this policy? I think what we're going to start to see is a lot of people either make or break their careers based on how they approach AI and what messaging they put out there and what policy they propose, which makes me think that a lot of people are going to be calling up Andrew Yang over the next couple of months as it relates to AI. They're going to want to get some advice from this person on, okay, you ran this exact campaign. You were literally eight years early. It worked. You were on the national debate stage. You created this whole movement. like what should i do um and so i think it's it's you know i i think it's a big moment for andrew in a lot of ways because everything he predicted is kind of coming true um and certainly from a political perspective yeah i hope so i think it'd be a positive influence this episode was produced by claire miller and alice and engineered by benjamin spencer Our video editor is Jorge Carti. Our research team is Dan Shalan, Isabella Kinsel, Chris Nodon, Hugh and Mia Saverio. Jake McPherson is our social producer. Drew Burrows is our technical director. And Catherine Dillon is our executive producer. Thank you for listening to Prof G Markets from Prof G Media. If you liked what you heard, give us a follow and join us for a fresh take on markets on Monday. You have me in kind reunion. Reunion at the water. And the dark flies in love.