Moonshots with Peter Diamandis — EP #207

Guests: Dr. Eric Schmidt (Ex-Google CEO), Dave Blundin
Main Theme: The US vs. China AI Race & Avoiding a Global Crisis
Date: November 11, 2025

Episode Overview

In this thought-provoking episode, Dr. Eric Schmidt (former Google CEO) joins Dave Blundin to dissect the rapidly intensifying AI race between the United States and China. The conversation traverses strategic advantages, vulnerabilities (particularly in hardware and energy), potential global crises stemming from AI advances, and the unprecedented opportunity AI presents for founders. Schmidt discusses key learnings from his new book (Genesis: AI Hope and the Human Spirit, co-authored with Henry Kissinger), draws analogies with the nuclear arms race, and offers actionable advice for new entrepreneurs navigating this explosive era.

Key Discussion Points & Insights

1. The Status of the AI Race: US vs. China

Timestamps: 00:00–03:25

• Hardware & Energy Constraints:
  The US currently leads in advanced AI development, primarily due to hardware restrictions imposed on China. However, China is excelling in large-scale energy generation, which is critical for the next wave of AI growth.

  “China put in 172 gigawatts of solar last year... The country needs more energy and if we don't get more energy, we're not going to be able to fully exploit the lead we have in AI and AGI.”
  — Eric Schmidt [00:10]

• Divergent AI Strategies:

  • US: Pursues Artificial General Intelligence (AGI) and superintelligence.
  • China: Integrates AI ubiquitously in its products and services but in a "more classical way."

  “America is going to seek for AGI. I was quite worried that we would end up in a super intelligence race... It looks like that fear... was not well grounded.”
  — Dave Blundin [02:11], Eric Schmidt [03:09]

2. China’s Dominance in Robotics and Manufacturing

Timestamps: 03:25–04:54

• China’s advantage lies in inexpensive, scalable hardware production, foreshadowing a world “awash in inexpensive Chinese robots” analogous to their dominance in electric vehicles and solar.

  "Our software is so much better than the Chinese software. But at the hardware level, I think you should assume that the world will be awash in inexpensive Chinese robots in the same sense that there'll be a wash in inexpensive Chinese electric vehicles.”
  — Eric Schmidt [03:29]

• Example: Chinese company Unitree’s humanoid robot R1 becoming commercially available for only $6,000.

3. The Looming Electricity Crisis in the US

Timestamps: 04:54–08:07

• As AI scales beyond current chip constraints, the bottleneck will shift to electricity, with the US facing serious shortfalls.

  “We looked at the amount of electricity required... by 2030, 92 gigawatts to be built... a big nuclear power plant is... one and a half gigawatts... So, effectively zero nuclear plants being built in America… The country needs more energy, and if we don't get more energy, we're not going to be able to fully exploit the lead we have in AI and AGI. It's very clear.”
  — Eric Schmidt [05:24]

• The US may need to rely on energy deals with other nations to power critical AI training.

4. AI Catastrophe and Regulatory Analogies

Timestamps: 08:07–12:55

• Drawing on Kissinger’s negotiation of nuclear treaties, Schmidt argues for proactive international agreements before a major AI disaster strikes.

  “Is there an analogous set of things that we can do? … Governments tend to act reactively... The first is misinformation... The second one is cyber... The third one is bio... Most people believe that one of those three will create some kind of mini crisis that will then cause the governments to say... let’s have a conversation about how to really deal with the downsides.”
  — Eric Schmidt [09:14]

• Schmidt is particularly concerned about bio-threats, where small groups could create undetectable, dangerous pathogens using AI.

• Discussion on US policy pivots:

  • Biden admin: Containment via tracking large model training runs (>1E26 flops).
  • Post-election: Shift toward rapid innovation (David Sacks/Trump admin), with less focus on proliferation controls.

5. Model Distillation, Open Source Risks & Proliferation

Timestamps: 12:55–17:29

• Enhanced training efficiency (eg., moving to 4-bit floating point) massively reduces cost, blurring the lines of control and increasing proliferation risk.

  “The proliferation issue, I'm not worried about big companies in big countries... I'm much more worried about the open source groups which can operate in the shadows... they can patch together the open source which is generally available and it's good enough.”
  — Eric Schmidt [12:55]

• Unintended outcome: The US keeps models closed-source (for safety), while China’s open-source models may become global defaults due to accessibility, not superiority.

  “This produces a bizarre outcome where the biggest models in the US are closed source and the biggest models in China are open source... the vast majority of governments... will end up standardizing on Chinese models not because they’re better, but because they're free.”
  — Eric Schmidt [16:21]

6. Advice for Founders in the Modern AI Era

Timestamps: 17:29–22:51

• Zero Barrier to Entry:
  Starting a tech company is easier than ever; the challenge is global, rapid competition.

  “The barrier to entry to starting a company is effectively zero now... as a result, you’re now competing against everyone all the time.”
  — Eric Schmidt [18:30]

• Learning over Planning:
  The fastest-growing, highest-potential firms take a “learn everything” approach over a “specify everything” one.

  “I know nothing. Learn everything... If you take a learning approach, then you build a system that if it works, it will explode... because once the learning accelerates, you get into a quasi monopoly position.”
  — Eric Schmidt [18:30]

• Rapid Scaling & Platforms:
  Success comes from being able to quickly scale and build platforms with network effects.

  “Show me how you’re going to build a system that goes from zero to infinity... Build a platform that scales... the stronger the platform, the more networked it is, the stronger the network lock-in.”
  — Eric Schmidt [21:18]

7. The Significance of This Moment in Technology

Timestamps: 22:51–25:27

• AI as a civilization-defining breakthrough, akin to electricity or fire.

  “I firmly believe that the arrival of non-human intelligence, AI intelligence, is at the level of electricity or the invention of fire... The next 10 years are probably the 10 years that will have a greater determination over the next hundred years than anything before because of the inventions of these new tools.”
  — Eric Schmidt [23:56]

• Countries and companies that swiftly embrace and apply AI will be “the big winners;” laggards will be left behind.

  “...the countries and companies that embrace this non-human intelligence correctly and aggressively will be the big winners... Economic growth comes from the application of intelligence to discover new things, to solve new problems.”
  — Eric Schmidt [23:56]

Notable Quotes

• On the urgency of action:

  "Governments tend to act reactively... The first is misinformation... The second one is cyber... The third one is bio... One of those three will create some kind of mini crisis that will then cause the governments to say... let's have a conversation about how to really deal with the downsides."
  — Eric Schmidt [09:14]

• On opportunity for founders:

  "The barrier to entry to starting a company is effectively zero now... as a result, you’re now competing against everyone all the time."
  — Eric Schmidt [18:30]

• On the historical importance of AI:

  “The arrival of non-human intelligence... is at the level of electricity or the invention of fire... The next ten years are probably the ten years that will have a greater determination over the next hundred years than anything before.”
  — Eric Schmidt [23:56]

Memorable Moments

• Eric Schmidt ordering a Chinese humanoid robot out of curiosity:
  “Unitree just launched the R1 for $6,000 available in December. I’m, I’ve ordered one. We’ll see how good it is.” [03:29]

• Schmidt’s candid take on US bureaucracy:
  “When you were running Google, you felt like you made decisions three times faster than any company on the planet... [But] in the federal government, you felt like the decision making was one third as fast as even a slow company.”
  — Interviewer paraphrasing Schmidt [08:14]

• The closing, historic call-to-action:
  “We are fortunate to be living in a time of great historical consequence. The next 10 years are probably the 10 years that will have a greater determination over the next hundred years than anything before...”
  — Eric Schmidt [23:56]

Timestamps for Key Segments

• US and Chinese AI strategies compared: 00:00–03:25
• Robotics/electric vehicles and manufacturing advantage: 03:25–04:54
• Electricity constraints/regulatory issues: 04:54–08:07
• AI disaster scenarios & analogy to nuclear regulation: 08:07–12:55
• Model proliferation/open vs. closed source geopolitics: 12:55–17:29
• Advice for next-gen founders/platform thinking: 17:29–22:51
• Eric Schmidt’s quote on the significance of this era: 22:51–25:27

Final Thoughts

Schmidt’s optimism for American innovation is clear, yet his caution about the risks—especially regarding energy, open-source proliferation, and potential bio-threats—is equally strong. The episode closes with a powerful reminder that we are entering a historic technological inflection point. The message for founders: move fast, learn relentlessly, and build systems that scale—because the world is about to change faster than ever before.