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- [00:01]
Max Chaffkin
The thing about AI for business, it may not automatically fit the way your business works.
- [00:06]
Drake Bennett
At IBM, we've seen this firsthand. But by embedding AI across hr, IT
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Max Chaffkin
and procurement processes, we've reduced costs by
- [00:15]
Drake Bennett
millions, slash repetitive tasks, and freed thousands
- [00:18]
Max Chaffkin
of hours for strategic work.
- [00:20]
Drake Bennett
Now we're helping companies get smarter by
- [00:23]
Max Chaffkin
putting AI where it actually pays off, deep in the work that moves the business. Let's create smarter business. IBM, Adobe, Acrobat Studio, your team's home base. Collaborate within a shared PDF space. You've got your docs, your plans, your specs, and then invite the crew to build what's next. Talk off the teamwork.
- [00:41]
Drake Bennett
Here's an updated render.
- [00:42]
Max Chaffkin
They think that this design could be a contender, but when somebody wonders what's the next step, AI helps you finish the rest. Bolts are tight. Now your plan's refined. Run a smoother business when you're on the line.
- [00:56]
Javier Blass
Do that with Acrobat.
- [00:58]
Max Chaffkin
Learn more@adobe.com Dothatwith Acrobat.
- [01:03]
Chase for Business Announcer
Bloomberg Audio Studios Podcasts Radio news.
- [01:18]
Stacey Vanek Smith
Of course, the big news this week as we sit here in the studio. The US and Israel have been engaging in coordinated attacks against Iran. And Iran, for its part, has been retaliating with attacks across the region.
- [01:32]
Max Chaffkin
We're talking about a conflict that is, you know, very quickly spilling over into the rest of the Middle East. According to Iran's Red Crescent, there have been a huge number of casualties, including nearly 200 children under the age of 10, killed. A thousand people. Here is Defense Secretary Pete Hegseth speaking to the press on Wednesday, March 4. Iran cannot outlast us. We are going to ensure, through violence of action and our offensive capabilities and our defensive capabilities, as I said, that we set the tone and, and the tempo of this fight. And that's why we don't talk about, you can save four weeks, but it could be six, it could be eight, it could be three. Ultimately, we set the pace and the tempo. The enemy is off balance, and we're going to keep them off balance.
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Stacey Vanek Smith
The results of these attacks have been absolutely massive. Across the globe, oil and gas prices have skyrocketed. Travel out of the Middle east has essentially been halted. And countries all over the region have been holding their breath to see basically how this conflict is going to roll out and affect their economies and their daily lives.
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Cincinnati Insurance Announcer
Yeah.
- [02:36]
Max Chaffkin
And there are two pieces of this ongoing war that we here at everybody's business have been following closely. The first is a resource we all need to survive, and the second is a technology that our society is increasingly
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Javier Blass
Relying on oil is very important and fundamental. But if you think about the well being of the hundred million people that live on the eastern side of Persian Gulf, water is what really makes or break it.
- [03:05]
Amanda Mull
There was a ton of people deleting ChatGPT. So the consumer public says we like it when you say we don't want to surveil the general public in this way or decide where missiles go.
- [03:19]
Stacey Vanek Smith
That was Javier Blass and Amanda Mole talking about drinking water and AI, two aspects that will make or break further escalations between the U.S. israel and Iran.
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Javier Blass
Foreign.
- [03:34]
Max Chaffkin
Business Week. This is everybody's business. I'm Max Chaffkin.
- [03:36]
Stacey Vanek Smith
And I'm Stacey Vanek Smith. Stay with us because at the end of the show we have a special guest joining us to share their underrated story for the week and an essential weekend.
- [03:45]
Amanda Mull
Listen.
- [03:48]
Max Chaffkin
But first, Stacey, let's take a look at the headlines. Obviously, we have the war in Iran, which we will get to. But also, it is an election year. It's a midterm season. As of Tuesday, the midterms have begun. We had our first primary, Texas and North Carolina, and we got some results.
- [04:07]
Stacey Vanek Smith
Yes, I've been hearing you making phone calls and reporting about this. So walk us through what is going on.
- [04:12]
Max Chaffkin
Okay, so in terms of what happened on Tuesday, the big news was out of Texas. And I just want to say, first of all, long election season, it was very easy to get wrapped up into any of this stuff. But the bottom line is, number one, big turnout numbers for the Democrats. So I've been saying this on the podcast, there's a lot of Democratic enthusiasm. You know, Democrats really don't like Trump. Also, as we've talked about pretty much continuously, a lot of Trump's sort of most popular issues have begun to backfire, particularly on the economy. But also, you know, Iran, like this conflict is not popular. So in Texas, you know, red state, you were seeing Democratic turnout ahead of Republican turnout. On the, on the Democratic side, James Talarico beat Jasmine Crockett by about 5%. She's constantly sort of trolling, pushing the envelope, but her politics are not that far left. Talarico is the opposite. He's like, he reads as very, as very different, as sort of more like a uniter or something like that. But his politics are actually further, probably a little bit further to the left of Crockett. But Democrats in general, I think, are probably more optimistic in Texas than they've been a long time because they're running against a Republican field that is divided. You had John Cornyn the current center running against Ken Paxton, who is a very controversial figure, to say the least. They're going to a runoff. That should be interesting.
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Stacey Vanek Smith
Yeah, sounds like it.
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Max Chaffkin
The other thing worth keeping an eye on are voting issues. So in Texas, there was this thing in Dallas county, of course, one of the population centers, also really important center for Democrats, where a bunch of voters basically showed up at the wrong precinct because there had been a whole, a change of rules with the state Republicans and people got confused. It went all the way to the Supreme Court. And you have that. You have basically an ongoing fight about people's votes being counted. That fight looks like it will not decide the Democratic primary. It looks like it's getting ironed out. But I do think it's kind of a preview of what is to come. The Republicans are, including Donald Trump and Elon Musk, are pushing this thing called the SAVE Act. It is a, a voting like a basically a voter ID law. It would require voters to prove their citizenship when they register and have photo ID when they vote. Republicans have traditionally pushed these things because I think the view. Well, there are two reasons. One is they argue that, you know, we have to stop noncitizens, we have to stop voter fraud. But there is a more cynical explanation which has long been that they are trying to suppress Democratic turnout because historically Democrats draw from more like working class people who don't necessarily have their birth certificates, driver's licenses, et cetera, handy and maybe also are not the most like regular voters. So you have like high motivated voters. They've got their voter card, they know their precinct, they know everything. They show up no matter what the rules are. And then you have this other cohort of people who are like, I'll vote, but you know, I'm not going to like go way out of my way. And the thinking has been that if you throw up a bunch of barriers, maybe that affects the turnout. Now, one thing that's fascinating about the SAVE act is vote. The voter makeup of the Republican Party is shifting and it is not clear that if this thing passed, which it has not, it got through the House. I think it's chances in the Senate are unlikely. Despite what Donald Trump is doing, there is some chance it would hurt Republicans more than Democrats because under Donald Trump, there is a. The Republicans have a higher percentage of, you know, basically people who do not vote. Every time. The kinds of voters that traditionally voted Democrat, some of them have moved over to Donald Trump. So it's kind of unclear how this would play out, but I think it is absolutely guaranteed that this will be an issue. We also have, you know, in, in Kansas, the state is invalidating trans driver's licenses, which could also impact voting. So there' just like a lot, there's a lot of stuff here. It's going to be a whole thing.
- [08:23]
Stacey Vanek Smith
Well, we'll have to keep our eyes on it. About the war in Iran, there is a lot of talk about oil being completely central to how this conflict unfolds and completely central to the impact this conflict is going to have on all of us. But recently, opinion columnist Bloomberg's Javier Blass, who is the author of the World for Money, Power and the Traitors who Barter the Earth's Resources, makes the case that there is actually a different commodity we should be keeping our eye on. Drinking water.
- [08:59]
Max Chaffkin
Well, right, and not only drinking water, but kind of drinking water as a frame to understand just how significant this conflict could be for the entire region and maybe even the entire world. We have Javier Piping in from London to talk about this awesome, really fascinating take. Javier, welcome to everybody's business.
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Javier Blass
Thank you for having me.
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Max Chaffkin
All right, so just to start, do you want to just take us through the argument like why is water more important than oil when you're looking at this conflict? Because like if you're reading the news on a day to day basis, it is entirely about Strait of Hormuz, oil price, global markets and so on. But give us your perspective here.
- [09:40]
Javier Blass
Look, oil is very important and is absolutely fundamental to the well being of the global economy. But if you think about the well being of the hundred million people that live on the the eastern side of the Persian Gulf, I'm thinking about Kuwait, Saudi Arabia, Qatar, the United Arab Emirates, Bahrain. For them, water is what really makes or breaks it. And all of those countries, the majority of the water consumption doesn't come from aquifers or rivers. It comes from desalinization. It's seawater. It goes through different physical processes. They're very energy intensive. But if anything, those countries have is energy, cheap gas and cheap oil. And they get water, drinking water, potable water. Without it, there is no way to sustain life. Those countries don't export oil for a few days, a couple of weeks, say four weeks, they can make it. They run out of water for more than two or three days, they cannot make it. And those water desalinization plants, they are spread all around the Persian Gulfs, about 450 of them. And they are absolutely key. You destroy them, you have a massive geopolitical problem that potentially could change I think that it will change the conflict. I think that everyone is looking at a liquid in this war, and I think that they are looking at one that makes a lot of sense, oil. And I think that is very important. Don't get me wrong. I spend my day writing about oil, but I think that no attention is paid at water. And I think that that could be critical.
- [11:13]
Stacey Vanek Smith
There's been a lot of bombing of different countries around the Gulf and different kinds of buildings. And you point out one very important desalinization plant that feeds Saudi Arabia and I think is responsible for something like 90% of the country's drinking water. This does seem like a very, like a major point of vulnerability that Iran likely knows about.
- [11:36]
Javier Blass
So Iran has already bombed two power plants that they are associated with desalinization plan. So the typical desalinization plan in the Middle east will have one power plant that will generate electricity and then you have the desalination plant. Iran has already attacked two of those power plants that they are literally attached wall against wall. The plant that you are talking about is in the Persian Gulf coast of Saudi Arabia. It's called the Jubail, the salinization plan. And it supplies around 90% of the water needs of Riyadh, the Saudi capital. The water goes from the coast 500 km up into Riyadh via a very complex pipeline system. We know some of these details because there was a memo, a diplomatic cable from the US Embassy in Riyadh that got disclosed on that massive release of documents, that massive leak of documents. That was WikiLeaks. And in 2008, the memo from the US embassy says, and I quote, riyadh will have to evacuate within a week if the plan, his pipelines or associated power infrastructure were seriously damaged or destroyed. The current structure of the Saudi government could not exist without the Jubilee desalinization plan. That's not a conspiracy theory. That's not someone writing a blog on the Internet. That is a cable from the US embassy in Saudi Arabia in 2008. That is how central these desalinization plans are for not only Saudi Arabia, but other countries in the region. My aim was to highlight that we are reaching a point in the world where we need to start thinking about the. And this was one of those unthinkables that I am trying to put into the minds of everyone, Stacey and I.
- [13:38]
Max Chaffkin
What was it like nine months ago when Israel bombed Iran in June? Had John authors, our colleague on. And he raised what sounded like the worst case scenario. The worst case scenario at that point because of course the US had not really entered the war. Trump was threatening regime change, but not doing the regime change. He was just truth socialing about it. But the worst case scenario as laid out by John was like the Strait of Hormuz is closed. You have Iran, because it's cornered, lashing out at its neighbors, shooting missiles at Dubai, at basically US military bases in the region, trying to create a sort of regional conflict rather than this, than one that's focused in Iran. And of course like that's what's happening, that's, that's now that that worst case scenarios come and you're laying out this even worst case scenario where you go from scattered bombings to real attack on almost like trying to create civilian casualties. And there are even worse outcomes that, that you could contemplate, right? You could come to contemplate a civil war in Iran and a massive refugee crisis and on and on. What do you make of the strategy here? Like insofar as there is a strategy, what do you see as the strategy and, and are they achieving it?
- [14:54]
Javier Blass
I think that they have spent on the run up to this, talking to a lot of war experts and Middle Eastern experts on a strategy and I think that everyone was expecting something similar to this. I mean to my surprise is that the White House is surprised that Iran is playing the war like this. I mean it makes sense that the only way that it can survive is it cannot really prevail on a military basis. His air force has no match whatsoever against the American air force. At some point we are seeing Iran fighting the United States, which is deploying the weapons of 2025, 2026 against planes that they were designed in the 60s. It's just no match whatsoever. So they need to basically increase economic costs, go after soft targets, etc, etc. I don't think that we are even remotely close to worst case scenario. My worst case scenario is really somber. I'm a kind of half glass empty kind of guy. So I'm always thinking what can go wrong? So Estrada Hormuz has been closed, has been closed six days. What if it's close 60? Iran has attacked some energy facilities, but not anything important and not really with intensity. It's not attacking, is not just one or two drones. It will be like sending 500 against oil fields, oil terminals, et cetera, et cetera. My concern is that this really properly escalate and then is when the price of oil goes much higher, when the countries can see troubles, what if they attack the water supplies? Riyadh itself is a city of 7 million people. It is one of the largest metropolis in the Middle East. What if they lose supply? How do you evacuate a city of 7 million people today? Those are the kind of things that I worry, I mean when, when, when a war starts, all, all plants just basically have to be thrown away and we don't know how, how that's going to play out. On the other hand, we are on day six.
- [16:55]
Stacey Vanek Smith
You know, feels like way longer.
- [16:58]
Javier Blass
It does, but it's not going. I mean, you look at the dead, Iran is putting a good fight and a good defense. It's not going to win. I don't have any question whatsoever that the US Prevails here is how much damage Iran can inflict in the neighboring countries before that happens. And also, let's not forget President Trump has a lot of off ramps at his hand. I mean, he has achieved, you may agree or disagree with the White House, but if you look from a non political position, what it has achieved already, it has crashed the nuclear program of Iran completely. It has significantly degraded the ability of Iran to launch ballistic missiles. And a stockpile of ballistic missiles of Iran has been reduced. And he killed the supreme leader and around 40 to 50 other people of the Iranian leadership. I mean, President Trump can turn around any day and say, mission accomplished, we are done. Major combat operations are over and we are going to keep a watchful eye Iran. Don't do anything silly because we will hit you back. But this is over.
- [18:15]
Stacey Vanek Smith
It struck me the idea of like, what if the Straits of Hormuz are closed for 60 days if that happens? I know that the US and Europe are in kind of different positions. Like what, what does that look like for the US and for Europe if the Strait of Hormuz is closed for, for 60 days, is it a different. I mean the US produces a lot of its own oil. Europe is mostly a net importer. I don't know what, what does that, how does that play out?
- [18:41]
Javier Blass
The US Produces a lot of oil. It's a net exporter actually. But the price of oil is set on the global market. And a crisis anywhere is a crisis everywhere. Everyone is going to feel the pain and the price is going to go up for everyone. The oil market is not really thinking about 60 days. I think it's thinking more about six days at the moment. It will mean a significant oil shock. People say, oh, worst case scenario is $100 oil. On a truly worst case scenario, what I will call a really worst case scenario, I think that we go north of $200. We will need massive demand destruction. It will imply an economic shock of the size that the central banks will have to intervene, et cetera, et cetera. It's very ugly. But that's one of the reasons that I cannot see this lasting 60 days. I think that the White House will call it over a lot earlier. And that's not like there is a lot of cynicism on Wall street and they say, oh, that will be Taco.
- [19:46]
Max Chaffkin
I think Taco is out the window here. I mean Taco was, he doesn't knock out the Supreme Leader. That was kind of where we were nine months ago.
- [19:55]
Javier Blass
Well, that's what I say. A lot of citizens, I don't think that will be tackled. I mean, having achieved killing the Supreme Leader, I think that President Trump can turn around and say I'm done any day. And I still claim that he achieved a lot. Again, we can't just question whether actually was achieved, whether killing the Supreme Leader actually brings us closer to have a prosperous democratic and stable Iran, which I don't think it does. But I do believe that the White House has a lot of off ramps that they can take. This really gets ugly and they decided that the economic price is not worth anymore.
- [20:32]
Max Chaffkin
Javier Blass, thank you so much for being here. We will have to stay in touch as this conflict continues and check in with you down the road. Thanks a lot for the time.
- [20:43]
Javier Blass
Thank you. Hopefully not in 60 days.
- [20:54]
Public.com Announcer
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- [22:07]
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business owner isn't just a career, it's a calling. Chase for Business knows how much heart and effort go into building something of your own. That's why they make business growth their priority. The Chase team takes the time to understand your mission, where you are now and where you want to go. Their broad range of solutions is designed with you in mind so you can bring your ideas to life. From banking to payment acceptance to credit cards, you can conveniently manage all your business finances all all in one place with their digital tools looking for tips and advice, their online resources are always available to give you the solutions you need to help your business thrive. See how your business can get stronger and go farther with Chase for Business. Learn more@chase.com business chase for business make more of what's yours the Chase Mobile app is available for select mobile devices. Message and data rates may apply. JP Morgan Chase Bank Naomi Member FDIC Copyright 2026 JPMorgan Chase Co.
- [23:05]
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- [24:08]
Max Chaffkin
interesting side alleys of what is happening in Iran is a question of AI, and in particular these big AI companies that are now defense contractors and even the use of some of these chatbots, as crazy as it sounds, in the planning and prosecution of the war itself. But luckily we've got somebody great to talk about. It's Amanda Mull, Bloomberg columnist. You know, Amanda normally writes about brand perceptions but there was this dispute between Anthropic, which one of the two big chatbots, and the Pentagon. You want to just talk us through what happened as well as the backlash that's been brewing.
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Amanda Mull
So Anthropic, up until quite recently was a active government contractor. It had DoD contracts to allow the government to use its AI models. Claude.
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Max Chaffkin
I call him Claude.
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Amanda Mull
Yes, Claude. Yes, sir. Claude. In different types of defense applications. So. And Anthropic CEO and ptegseth and their respective organizations had been feuding for a little bit over exactly the details of how those models were going to be used. Pete hegseth and the DoD wanted to use them for, quote, unquote, all lawful purposes. And Anthropic wanted a slightly different implementation. Specifically, they did not want to agree to allow mass surveillance of American citizens, and they didn't want Claude to be used in the deployment of fully autonomous weapons. And the DoD and Hegseth were arguing that this is a lawful use and you can't tell us what to do with your tools once we've bought your tools. At the end of last week, this sort of exploded. Anthropic got dropped as a government contractor. The DoD labeled them a supply chain threat, which means that other government contractors, other defense contractors, are not allowed to use or do business with Anthropic, which is a problem because all of the tech companies are intermingled in their use of each other's services. So Google, Amazon, et cetera, can't be involved with Anthropic anymore, theoretically. And into this sort of vacuum of government contracting came OpenAI and Sam Altman. And essentially what he said is, we'll do it, you know, and because these companies are both consumer facing, we're okay
- [26:22]
Stacey Vanek Smith
with mass surveillance and we're okay with our technology being used like direct drones.
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Amanda Mull
That's the thing. Nobody really knows exactly what OpenAI's agreement with the Department of Defense is. We know what Sam Altman has said publicly.
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Max Chaffkin
We also don't really know how these tools are being used. I feel like anytime this comes up, I have to say, reminder, these are tools for summarizing emails. Like that is their main use. That is how the Pentagon is using them. They're using them more or less the same way that everybody else is using them. And even in the back and forth with the Pentagon, there were Defense Department sources saying, essentially we're not using it in the ways that Anthropic is worried about. We just want to keep our options.
- [27:03]
Amanda Mull
We just want to be able to do that in the future. If we feel like it, basically.
- [27:06]
Max Chaffkin
But there is an interesting brand perception here.
- [27:08]
Amanda Mull
Right, Amanda, with these AI companies, you have sort of an interesting case where OpenAI and Anthropic in particular are sort of hungry for revenue. They've got these very expensive companies with very expensive data needs, very expensive development needs, borrowed a lot of money, and they are looking for ways to apply the technology they have in, in ways that earn them revenue. So you've got them government contracting, doing corporate contracting, doing consumer applications, and which means that they are oddly exposed both to government whims and to consumer perception, which is not the case with most government contractors.
- [27:50]
Max Chaffkin
But let's talk about the backlash. Because OpenAI steps into the breach, says, yeah, we'll do it.
- [27:56]
Amanda Mull
Sure.
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Max Chaffkin
And immediately people start deleting ChatGPT.
- [28:00]
Amanda Mull
Yeah, this is where it gets real funny to be both a defense contractor and a consumer company that is trying to cultivate this sort of like warm, cuddly, friendly, maybe sycophantic, depending on the attitude of the particular chatbot model. We're talking about presence toward the general public. So Sam Altman said, yeah, we'll do it, and what is it? We don't know. But he sort of jumped into the breach with the company. He leads to say that we'll take this revenue. You can use our tools. And so the general public, having many of them having some sort of financial relationship with ChatGPT, even if it's just a $20 a month user subscription, said, we don't like that. We don't want to be mass surveilled by our government in this way.
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Max Chaffkin
ChatGPT, it's a new movement. It's the new hot thing on social media.
- [28:43]
Amanda Mull
Yeah. So there was a ton of backlash online. People posting screenshots of themselves deleting ChatGPT, getting rid of their subscription, and then downloading Anthropic Claude. Basically, Claude jumped to the top of the Apple App Store download list. It remains there as of me talking right now. I just checked it. Yeah, there was a huge surge in downloads, a huge surge in subscriptions. So the consumer public says, we like it when you say we don't want to surveil the general public in this way or decide where missiles go.
- [29:15]
Max Chaffkin
We wanted to maybe take a broader view of this. We sent producer Jasmine J.T. green out into New York City just to ask some people if they had groked this controversy. Do y' all use AI currently? Not really. Yes, I do.
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Amanda Mull
How come if we teach the AI how to do things, it's not gonna
- [29:35]
Stacey Vanek Smith
do Them as well as, like, people could do it.
- [29:37]
Max Chaffkin
I used it when it first came out like a little bit, and I was like, this is ass. Like, with the art stuff. Everything I can create, I can create by myself. I use it a lot when I'm traveling, trying to figure out where I am, what's happening today. AI was like originally made to do menial tasks, and now it's going the other way around and I don't want to be part of that. OpenAI just took a contract with the Department of Defense. Were you guys like following any of that? I wasn't following, but it's more like, why are we using the robot to kill people? AI should not be used for human surveillance.
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My Policy Advocate / iShares Announcer
Really.
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Max Chaffkin
We shouldn't have as much human surveillance as we already have. It's kind of like a whole crazy thing.
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Amanda Mull
It's gonna misread what humans are doing, so then it's gonna misfire a lot. And in like trials of like, it
- [30:27]
Max Chaffkin
thinking that it's doing the correct thing, it's gonna.
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Amanda Mull
It could just do a lot of damage.
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Max Chaffkin
I've been following the story and I'm
- [30:33]
Drake Bennett
kind of interested in it in the
- [30:35]
Max Chaffkin
sense that AI unsupervised without human intervention is no better than a coin operated machine that you used to get a candy bar out of and it would get stuck. What happens when it gets stuck? There's no way to report it. I've never really seen a need for it. Have we not read any dystopian, like shit, like, it's just. This doesn't sound very good. We are like halfway to like really good science fiction story there. I feel like, I mean, Amanda, do you think there's the question about these chatbots and them becoming politicized? And I was surprised. I started looking for where this quit GPT trend started. It actually started a month ago during the, just after the Alex Preddy killing where you had a bunch of liberals basically looking for conservative Trump aligned companies to boycott and finding this one, which is a pretty good target because the coo Greg Brockman has given a large amount of money to Donald Trump in this cycle, something like $25 million. And so you could see why this is happening. I'm curious, do you think that any of these boycotts have any kind of effect? Do they have a political effect? Do they potentially have a business effect? Could this really hurt? OpenAI?
- [31:55]
Amanda Mull
I think that there's two interesting questions with public perception of AI here. You've got like, public perception of AI as like a class of tool and as Like a class of business and how we want to integrate or not integrate tools into society and how we want to regulate those businesses long term. And then you've also got the question of, like, how these particular companies are viewed. And AI companies are in an interesting spot when it comes to like, brand perception because usually companies that become as large as they are do so over like a long period of time. Companies that have, you know, the amount of economic influence and social influence that these companies have cultivated, usually they've been around for a while and there's a lot of evidence of their political alignment, of how their tools are used, what their products do and like what, like particular political valence they might have. With OpenAI and Anthropic and other large AI companies, we're sort of figuring that out in real time after they've already gained all of this influence. So I think consumers have like an interesting opportunity to react to these companies and like reward or punish them accordingly because they are still building their place in public perception. And more broadly, I think it's important to these companies, like long term viability, how AI in general is perceived. So it might be good for Anthropic in its perception that it has said no in some form to the Trump administration on things that are broadly unpopular
- [33:17]
Max Chaffkin
with the public, you know, who work with large data sets. And this is where the mass surveillance comes in, right, Is intelligence analysts. And I think that like, people read these stories and I think they imagine like Grok, or it will be Grok, by the way, because now that now that Anthropic's on the outs, like Elon Musk's chatbot is, the lane is open. Yeah, exactly.
- [33:37]
Amanda Mull
Yeah.
- [33:37]
Stacey Vanek Smith
There are no guards.
- [33:39]
Max Chaffkin
You imagine like, like Grok, like telling the missile, like where to go. But what is actually, I think what is more realistic is massive data sets. Whether you're asking, you're asking the LLM to look at a satellite photograph and say where are the targets? Or you're just asking it to look over a bunch of phone records or stuff. And you can see why that's a little bit scary.
- [34:00]
Amanda Mull
And I think that it's important to remember that whether or not the models are like good at these functions doesn't necessarily determine whether or not those functions are dangerous. They're dangerous. It's dangerous when they're not good at it too, because then you get all kinds of mistakes that hurt or kill people. Potentially.
- [34:14]
Max Chaffkin
Yeah, we should say, like, there's still this ongoing question over how this Iranian school was destroyed. And I don't know if it would make us feel better or worse to know if AI had been involved, but it kind of highlights just how high the stakes are.
- [34:31]
Amanda Mull
Right. It's dangerous when the AI is great at these tasks, and it's dangerous in a different way when it's terrible at them but used anyway.
- [34:38]
Max Chaffkin
Stacey, you had asked about the businesses, like how big a factor are consumers in a given AI platform? And I think the answer is it depends on the AI platform. So one reason this matters a lot to OpenAI is OpenAI, unlike Anthropic, has a ton of consumer use because of the way that it happened. Right. They made this free demo called ChatGPT available to the public. Lots of people signed up. They have significant just normal people using it. Apps like Claude and Copilot are much more on the sort of work tool thing. Grok is all the way over if there's a continuum between friend and colleague. Grok is such a good friend that you're having sex with it and Copilot is not having sex with you. It's just searching your emails. And OpenAI is somewhere in the middle. There's something more uncomfortable if you're friends with your chatbot. There's something weird about your friend also surveilling gazillions of Americans. Whereas if your chatbot is just helping you summarize your emails, I don't know that it bothers you so much if they're working with the Pentagon.
- [35:41]
Amanda Mull
Right. I think that Anthropic, in showing like a modicum of backbone, I think did risk something real for the company.
- [35:48]
Stacey Vanek Smith
It's quite refreshing, honestly.
- [35:50]
Amanda Mull
Yeah. And I think that was like why you saw this surge in public, sort of like desire to support this company. Because there have been so few, like major companies that have been willing to. Especially tech companies. Yes, especially tech companies that have been willing to break with the Trump administration on literally anything. And Anthropic is not a boy scout like it. It partners with Palantir, which does a lot of data analysis and surveillance. Its models underlie a lot of Palantir's capabilities. IT earlier this year, while feuding with the Department of Defense, according to one of our colleagues at Bloomberg News, put in a bid to develop an autonomous drone swarm system for the Pentagon. So like Anthropic does want to do some of this stuff, it just doesn't want to do like a couple very particular things. One thing that I've been sort of waiting to see happen is for some of these businesses, these big like consumer exposed businesses in particular to decide that they see which way the wind is blowing. And like right now it's blowing away from a bunch of these like highly controversial Trump administration policies and toward more moderate, more progressive ideas of how some of this stuff should be handled. We see that in issue polling. You see it in how elections have gone thus far during the Trump presidency. So I think that like, if you're a company that has consumer exposure and you, you have a brand name to burnish and you're looking at the long term, it might be time to start taking the temperature on some of this stuff and start taking what feel like short term risks for long term avoidance of litigation or congressional hearings.
- [37:17]
Max Chaffkin
All right, Amanda, we're going to let you go. We are going to keep following this. Listeners. If you have changed chatbots, if you are now a Grok person or a cheat, a Claude person, let us know. Co pilot person, everybody's@Bloomberg.net and Amanda, thank you for being here. We'll have you back soon.
- [37:38]
Amanda Mull
Thanks so much for having me.
- [37:45]
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for peace of mind. But every year millions of claims are denied. Not because people did anything wrong, but because their polic quietly excluded what happened. Insurers know every detail. Policyholders rarely do. That's why my Policy Advocate exists for just 27 cents a day, their platform reads your policies and explains where you are vulnerable. They don't sell insurance. They deliver transparency. Before you trust your policy to protect you, let my policy advocate tell you what it really says. Go to mypolicyadvocate.com Stacy it is that time.
- [40:17]
Max Chaffkin
It's the time we talk about underrated stories. And we have a special guest, fellow member of the Bloomberg Audio Tribe universe, Drake Bennett, tech reporter at Bloomberg and more importantly, co host of the new limited series the Sixth Bureau. It is awesome. Co hosted with Jordan Robertson, who's another reporter. Drake welcome to everybody's business.
- [40:37]
Drake Bennett
Thanks guys.
- [40:38]
Stacey Vanek Smith
So tell us about the 6th Bureau.
- [40:41]
Drake Bennett
It's about the MSS, which is basically the most important intelligence agency that you've never heard of. It's the Ministry of State Security or most people have never heard of. It's China's Ministry of State Security. It's sort of like China's CIA and FBI combined. And we don't really know a lot about it in the West. The guys who work there are sort of like these ghosts. But we were able to basically find out all this amazing detail about this one MSS officer. And so we tell his story, his rise and his fall.
- [41:09]
Stacey Vanek Smith
Is he based in the US or in China or.
- [41:12]
Drake Bennett
He was based in China and if he had stayed in China, he would have been fine. But he sort of makes a fateful decision to leave China at a certain point.
- [41:20]
Max Chaffkin
Wait, let's just hear a little bit, a little clip from the show just to give people a taste of what they can look forward to. This is Special Agent Regal, Special Agent Bradley Hall. The time is approximately 11:15am about to
- [41:38]
Drake Bennett
start consensual telephone call with Dr. Daiwa Zhang.
- [41:44]
Stacey Vanek Smith
Oh my gosh. What is happening in this call? Like set the scene.
- [41:47]
Drake Bennett
Okay, so Mike Riegel is one of the two FBI agents who are at the center of this case. And Daiwa Jung is an engineer at GE Aviation who's basically going about his business, working on these very proprietary technologies to make GE jet engines. When the MSS reaches out to him and says, we saw your LinkedIn page, you look like a super prestigious smart guy. We'd like you to come give a talk in China about what you do. And that's often how these relationships start. So he goes over, he gives this talk. They ask some sensitive questions. He's very conscientious about not answering anything he shouldn't answer. But he did kind of like take a couple files with him, which is something he shouldn't have done. He didn't tell his bosses about it. Also something he shouldn't have done. So he comes back, and basically the FBI, kind of like he pops onto their radar. They've also already been kind of interested in Xu Yanjun, who's our main guy back in China for a little while. So they see this as an opportunity to try to put in a double agent. So they basically use this GE engineer. They sort of have him seem really interested in working with the MSS and giving up all these secrets. And so that's the lure they use. And this call is kind of like part of the process of trying to get Shue, the MSS officer, interested and hooked. Fifth episode comes out tomorrow, and then there's two more weeks that people can catch up before the sixth episode.
- [43:15]
Stacey Vanek Smith
And it sounds like very. It's like a spy novel.
- [43:18]
Drake Bennett
It is like a spy novel. I mean, the sort of amount of detail that we were able to get about Shu Yanjun in recordings. In recordings.
- [43:26]
Stacey Vanek Smith
Amazing.
- [43:27]
Drake Bennett
He sort of seems to have compulsively kept track of all the stuff in his life, stupidly sort of secret stuff, but also, like, very personal stuff about his, like, his gripes about his boss, like rejecting his expense reports, his kind of, like, feelings about his marriage. It's just. It's like all. It's a very deep portrait that we're able to sort of draw on Drake.
- [43:50]
Max Chaffkin
No one is underrating the 6th Bureau. Everyone's gotta go listen to that.
- [43:53]
Drake Bennett
Yes.
- [43:53]
Max Chaffkin
Hopefully by now they're sold. What is your underrated story for the week?
- [43:58]
Drake Bennett
My underrated story, and it's partly because I have been marinating in China stuff, is that there is this summit meeting coming up, supposedly at the end of March, between Xi Jinping and Donald Trump, and it's gotten kind of lost in all the Iran news, but it is a really big deal. And it's kind of an interesting summit because Donald Trump is kind of not a president that kind of fought like, normally for these things, there's this whole kind of like pre process that happens with these career foreign service officers who's sort of like laying the groundwork for this. And that's not. Doesn't seem to be exactly happening. I think it's Besant. I think it's Besant and the vice premier of China are sort of talking about stuff, but it's like, it's very focused on sort of trade stuff at the moment for understandable reasons. But there are other issues like Taiwan. And Trump kind of freaked everyone out in the kind of China foreign policy world in the US recently where he said, because it's all about these kind of very carefully modulated half things you say. And so someone like, he basically said like, yes, I'm consulting with China on whether to do this arms deal with Taiwan, which is like this huge no, no. And so he's just sort of like,
- [45:08]
Stacey Vanek Smith
why is that a no, no?
- [45:09]
Drake Bennett
Because you don't want to give China like a veto over your relationship with Taiwan. Like it's. You kind of don't want to let them tell us how we should be with Taiwan. And so that was seen as kind of this victory. But the other thing about Trump obviously is like the outcome of these summit meetings is often like some very carefully modulated statement, but Trump doesn't really do that. And also, like, he'll say something.
- [45:31]
Stacey Vanek Smith
He's not a carefully modulated guy.
- [45:33]
Drake Bennett
Go back on it. So it's just like the whole summit apparatus is kind of like in this interesting moment right now, what are some
- [45:40]
Stacey Vanek Smith
of the possible outcomes that make this an underrated story?
- [45:43]
Drake Bennett
Well, he could, you know, this arms deal that Taiwan is like, it's kind of unclear what's going to happen with that. I mean, I think the things that people are talking about more are these, are the tariffs, you know, are these sort of chip restrictions. Soybeans. People are talking about soybeans. That's like a, you know, it's a
- [45:59]
Stacey Vanek Smith
big market for US Farmers.
- [46:00]
Drake Bennett
Yeah, yeah.
- [46:01]
Stacey Vanek Smith
Well, definitely check out the sixth bureau. So already five of the six episodes are up. So check it out. Drake, thank you so much for joining us. Us and thank you for your underrated story.
- [46:10]
Drake Bennett
Thanks, guys.
- [46:18]
Stacey Vanek Smith
This show is produced by Stacy Wong and Jasmine J.T. green. Magnus Henriksen is our supervising producer. Sam Rogich handles engineering, and Dave Purcell fact checks. Special thanks to Jeff Muskus, Julia Rubin and Maria Ling. If you have a minute, please rate and review the show. It means a lot to us. And, and if you have a story that should be our business. Email us everybody's bloomberg.net that's everybody's with an sloomberg.net thank you for listening. See you next week.
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