AI's Threat to Gen Z's Jobs, the FartCoin Economy, and Why the Internet Wants to Check Your ID

Summary

Offline with Jon Favreau: Episode Summary

Episode Title: AI's Threat to Gen Z's Jobs, the FartCoin Economy, and Why the Internet Wants to Check Your ID
Release Date: August 14, 2025
Host: Jon Favreau
Guest: Kyla Scanlon, Economic Commentator and Substack Newsletter Author

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1. Age Verification Laws and Digital Privacy (00:01 - 10:05)

The episode opens with a discussion on the rollout of age verification laws, specifically the UK's Online Safety Act (COSA) and its American counterpart. These laws mandate online platforms to implement age checks to restrict underage access to "harmful and age-inappropriate content" (COSA, [04:23]). Jon Favreau highlights Kyla Scanlon's insights on the complexities and controversies surrounding these laws.

Key Concerns:

• Privacy Risks: Age verification often requires invasive methods like face scanning or government ID checks, raising significant privacy and security issues. Scanlon notes, “Age verification requires identification... they can be face scanning, that can be checking a formal government id... very invasive” ([04:23]).
• Effectiveness and Overreach: The broad application of these laws has led to unexpected blocks on communities such as alcohol support and LGBTQ spaces. Scanlon explains, “Websites are kind of going above and beyond to just block anyone who might be underage” ([07:07]).
• Public Backlash: The implementation has been met with surprise and resistance, highlighting the difficulty in balancing child safety with privacy and free speech.

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2. The Emotional Attachment to AI Chatbots (10:05 - 17:54)

The conversation shifts to the release of OpenAI's ChatGPT 5, which has sparked significant user backlash. The new model lacks the personalized memory of ChatGPT 4, leading users to feel a loss of connection. One user lamented, “This may sound all sorts of sad and pathetic, but 4 was kind of like a friend to me” ([13:15]).

Key Points:

• User Attachment: People form emotional bonds with AI chatbots, treating them as friends or confidants. Scanlon observes, “We do form attachments to them, for better or worse” ([15:44]).
• Model Upgrades vs. User Expectations: OpenAI's decision to reset ChatGPT’s memory disregarded the established relationships users had, resulting in disappointment and distrust.
• Future Implications: As AI becomes more integrated into daily life, the need for these chatbots to balance functionality with emotional intelligence becomes crucial.

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3. Evolution of Social Media and Posting Ennui (17:54 - 24:43)

Kyle Chayka discusses the transformation of social media from platforms where users shared everyday moments to spaces dominated by influencers and AI-generated content. This shift has led to "posting ennui," a phenomenon where users are disinclined to share personal content.

Key Insights:

• Shift to Passive Consumption: Social media has become more about consuming content rather than sharing personal experiences. Chayka notes, “We're scrolling TikTok or scrolling Instagram, but those feeds are full of brand posts and people who are brands” ([21:57]).
• Algorithmic Influence: Algorithms prioritize high-engagement content, often leading to the suppression of genuine, mundane posts.
• Emergence of "Posting Zero": Users may reach a point where they cease posting altogether due to the overwhelming noise and lack of visibility, as Chayka explains, “You suddenly realize we're not really on it for any reason” ([24:27]).

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4. AI’s Role in the Economy and Data Center Dependence (24:43 - 47:21)

The discussion delves into AI's significant contribution to the current economy, particularly through data center investments. Despite AI’s economic impact, the labor market remains heavily reliant on healthcare and social services.

Key Points:

• Economic Disparity: While AI and data centers are booming, job growth is concentrated in healthcare, revealing a disconnect between technological advancement and labor market needs. Scanlon states, “The economy is primarily being fueled by data center spend” ([44:53]).
• Data Center Challenges: The construction and operation of data centers require substantial investment but do not create long-term sustainable employment. Scanlon mentions, “Data centers... propel the economy but are not a long-term driver” ([46:55]).
• GDP and Concentration Risk: AI spending constitutes a growing portion of GDP, posing risks if this sector faces downturns. Scanlan notes, “The economy is very reliant on these AI companies to succeed” ([45:22]).

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5. Gen Z’s Economic Concerns and Labor Market Challenges (47:21 - 40:55)

Kyla Scanlon provides an in-depth analysis of Gen Z’s economic anxieties, highlighting the erosion of the traditional economic ladder and the uncertainty in career prospects.

Key Insights:

• Uncertain Career Paths: Unlike previous generations, Gen Z doubts the predictability of graduating, securing jobs, and achieving financial stability. Scanlon explains, “The economic ladder... is eroding and young people are feeling that” ([27:21]).
• Labor Market Realities: The labor market for recent graduates is tough, with slow hiring rates and an eroding college wage premium. Scanlon states, “Companies aren't hiring nearly at the rate that they used to” ([35:51]).
• AI Anxiety: The looming threat of AI automation adds to Gen Z’s job market worries, although current data suggests limited immediate impact. Scanlon notes, “AI has not taken the jobs... we’re still a long ways off” ([37:32]).

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6. The Meme and Speculative Economy: FartCoin and Lapubus (40:55 - 54:04)

The episode explores the rise of speculative economies driven by Gen Z’s financial nihilism and inability to participate in traditional economic structures.

Key Points:

• Aspirational Displacement: With high barriers to traditional investments like housing, Gen Z turns to speculative assets such as FartCoin and Lapubus. Scanlon illustrates, “People... go and spend on speculative things” ([51:30]).
• Financial Nihilism: A pervasive belief that there is no collective financial future encourages gambling behaviors. Scanlon explains, “There is no collective financial future, so I might as well gamble it all” ([52:57]).
• Psychological Impact: This speculative behavior reflects a loss of trust in traditional economic pathways and institutions, contributing to broader economic instability.

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7. Political Shifts and Trust in Institutions (54:04 - 62:37)

The conversation turns to the political ramifications of Gen Z’s economic frustrations, including shifts in voting patterns and declining trust in institutions.

Key Insights:

• Voting Behavior: Economic dissatisfaction has led some young people to support unconventional candidates like Donald Trump, driven by concerns over immigration and the culture wars. Scanlon notes, “Young people voted for Trump because of the economy” ([56:45]).
• Declining Trust: Trust in major institutions such as the Supreme Court, President, Wall Street, and media has plummeted, pushing Gen Z towards alternative platforms like Polymarket for truth discovery. Scanlon observes, “People don't trust the President, they don't trust Wall street, they don't trust media” ([55:04]).
• Attention Economy’s Impact: The need for sensationalism in politics undermines effective governance, as policies must compete for attention rather than focusing on substantive issues. Favreau reflects, “The attention economy and the digital world are making politics stupider” ([59:43]).

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8. Future Outlook and Policy Solutions (62:37 - End)

In the concluding segments, Scanlon discusses potential policy responses to AI’s economic impact and the need for sustainable solutions to support Gen Z.

Key Points:

• Policy Development: Scanlon is part of a working group aimed at ensuring AI benefits workers, emphasizing the need for transition packages and protective measures similar to past industrial shifts. She mentions, “I'm joining a little working group to try and figure out how AI can work for workers” ([63:43]).
• Hope for the Future: Despite current challenges, there is optimism that with the right policies, AI can be harnessed to support rather than displace the workforce. Scanlon remains hopeful, “Hopefully we can establish something” ([63:43]).
• Call to Action: Encouraging listeners to engage with and support innovative policy solutions to navigate the evolving economic landscape.

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Notable Quotes:

• Kyla Scanlon: “Age verification requires identification... they can be face scanning, that can be checking a formal government id... very invasive” ([04:23]).
• Kyla Scanlon: “We do form attachments to [AI chatbots], for better or worse” ([15:44]).
• Kyla Scanlon: “The economic ladder... is eroding and young people are feeling that” ([27:21]).
• Jon Favreau: “The attention economy and the digital world are making politics stupider” ([59:43]).

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Conclusion

This episode of Offline with Jon Favreau provides a comprehensive exploration of the intersecting challenges faced by Gen Z in the digital age. From privacy concerns with age verification laws and the emotional complexities of AI chatbots to the evolving landscape of social media and the speculative meme economy, the discussion sheds light on the profound economic and psychological impacts shaping the younger generation. Additionally, the political shifts and declining trust in institutions underscore the urgent need for innovative policy solutions to support a resilient and equitable future.

For more insights and in-depth analysis, subscribe to Kyla Scanlon's informative newsletter and explore her latest work on navigating the complexities of today's economy.

Transcript

[Jon Favreau]

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[Kyla Scanlon]

Like, well I can't really contribute to like the housing market, but what I can buy is Fartcoin which is like an AI generated crypto Mame coin and then Lapubus which are these like little bunny rabbit devil face dolls that are quite popular in the same style of a Beanie Baby. And so you end up with a lot of speculation. And the theory behind that is that people are not able to participate in the economy how one would expect and so instead they go and spend on speculative things. It ties into the concept of financial nihilism too, which is this idea that there is no collective financial future. So I might as well gamble it all on Fortcoin or Labubu.

[Jon Favreau]

I'm Jon Favreau and you just heard from economic commentator Kyla Scanlon. Wanted to talk to Kyla for a long time now. She writes a fantastic substack newsletter that I go to to understand economics. She is extremely smart but also is able to communicate about economics in a really accessible way and connects it with politics, the Internet, everything else that we talk about here. She's recently written a lot about the ways that AI has taken over the economy, why attention has now become a product in and of itself, and why Gen Z is justifiably feeling pretty down about the economy and their futures. I invited her on the show to talk about it all. We shared a great conversation about all of our strange economic anxieties and and what the future holds. We'll get to that conversation in a moment. But before we do, I sat down with the New Yorker's Kyle Chayka to talk about his recent writing on age verification laws in this week's strangest offline worthy news. Kyle, welcome to the pod.

[Kyle Chayka]

Thanks for having me back.

[Jon Favreau]

Want to start with age verification? You have a new piece in the New Yorker about the UK's Online Safety act, which rolled out a couple weeks ago, and cosa, its American counterpart, which was reintroduced in Congress with bipartisan support earlier this year. So for people who don't know, these laws mandate that online platforms implement age verification in order to block underage users from, quote, harmful and age inappropriate content such as pornography and material that might encourage eating disorders, bullying, hate or substance abuse. We've had a lot of conversations on this podcast about what phones and social media are doing to young people, and the consensus is nothing good. Too much screen time is affecting their mental health, self esteem, ability to learn, to socialize, their politics. So I am broadly supportive of getting kids off their phones. But the people you spoke to for the piece, they raised a host of concerns about age verification laws as one way to mitigate the harms to children that comes from easy access to the Internet. Can you talk about what they told you and what their concerns were about age verification?

[Kyle Chayka]

Yeah, it's kind of a paradox. I think we can all agree that the Internet is doing some bad stuff, and we wish that we could keep children off of it and maybe limit their exposure to the bad stuff and maybe limit some of our own exposure to the bad stuff. But no one can quite agree on how is best to do that. And you might think, okay, age verification, we'll just make sure that everyone online who's a child, we can identify them and serve them particular kinds of content and experiences. But that also means knowing the age of everyone on the Internet, because if you're trying to know who the kids are, you also need to know who the kids are not and that we adults are also online. So the problem becomes it's kind of twofold. I mean, age verification requires identification in the first place. You have to make sure you know someone's age. And that can be face scanning, that can be checking a formal government id. It can even be, I think I saw one mention of teeth scanning, like biometric markers of your age. And so those are very invasive. They can also be wrong. And it's not great to have that data floating around the Internet. And then there's another problem of actually blocking children who might be a little underage, but who are accessing content that's helpful to them, that might address some of their personal concerns, whether that's substance abuse, which is also a thing for minors, or queer identity, which is sometimes blocked by these blanket laws banning harmful content. So it's like the method of gating is bad, and then the gating itself can also be bad. Yeah.

[Jon Favreau]

I mean, we talked, I think, on last week's episode or the week before about the tapp, which I know you started your piece with, which is, you know, if you are uploading your license or some kind of identification to verify your age, there's plenty of data leaks. There's companies that aren't safe, there's hacks. Right. And so it does seem like a big problem is not ensuring people that when they try to verify their age, that that information is going to be protected. Especially if you're going on some sites that you might not want to be public.

[Kyle Chayka]

Yeah. I mean, as I did interviews for this piece, it was a bit of a divide between people who are very online and not very online. So if you're online enough, you know that anything you put out there is not secure. Probably someone's going to steal it. Probably it's going to get out there. And so if you're kind of wantonly uploading your identification or your face data, someone who you don't want to have it is going to have it within a matter of hours.

[Jon Favreau]

Yeah. So how has cosa, the age verification law in the uk, been received so far now that it's been a couple weeks?

[Kyle Chayka]

Badly, I would say with some shock, because, again, like, the idea of this is not so bad. There's plenty of reasons that we should verify who's who on the Internet or keep kids out of some spaces. But now in the uk, you have to upload your identification to Reddit to access a beer subreddit or an Alcoholics Anonymous subreddit. There's LGBTQ subreddits that are blocked by age verification. I think people were surprised that it was applied so widely, but that is part of the law itself, because the law doesn't define what is harmful Very well. So websites are kind of going above and beyond to just block anyone who might be underage from accessing almost anything.

[Jon Favreau]

Have you come across proposals or ideas from people about, you know, other ways to protect children's digital lives that wouldn't raise so many privacy and free speech concerns?

[Kyle Chayka]

Yeah, there are quite a few startups out there now that are offering to do verification and kind of make sure for these companies, for any digital platform, that their users are of age and that can take the form of still face identification or checking IDs, or even kind of scanning your email to see how long your email account has been around, or looking for credit card information. So there's other kinds of data checks and all those companies say that they'll delete your data or it's just a temporary verification and then they're not storing anything. But as we saw with the tapp, the TAPP spilled, the TAPP data got out there. And there's really no way of being sure that these companies are actually following the rules when they verify who you are or how old you are.

[Jon Favreau]

Yeah, it does feel like you could get a third party to verify your age, just in general. And then maybe they give you some, you know, digital token or, or a serial number or something that you can then use so that the sites that you're going to aren't the ones that have the your personal information, but just the third party does. I know there are some third party sites that do that, but it feels like if the government's going to pass a law, then maybe the government should require that.

[Kyle Chayka]

Yeah, it's like, who do you want vetting your identity? Who do you want storing that identity information? Do you want Meta to do it? Do you want Google to do it? Do you want the US government to do it? One young woman I talked to for this was just like, those are all bad. I don't trust any of those with my identity. So why am I being forced to do this?

[Jon Favreau]

What are the prospects for a similar law to actually pass here in the us?

[Kyle Chayka]

Well, COSA is the equivalent the Kids Online Safety act. And there keeps being optimism for it passing. There's this relative bipartisan support for it, there's momentum, but it's failed a few times already. So it's really not clear that it will definitely be passed nor that it will survive in its current form. So there's kind of already been outcries about this being a form of censorship. Like the government is stopping people from accessing information or accessing zones of speech through Digital gating. It's just very paradoxical. Like, some conservatives are mad about the free speech issues, others are mad about the child safety issues.

[Jon Favreau]

Yeah. And you can imagine on the liberal side in a Trump presidency, when there's already some crackdowns on free speech and privacy, you might not want to be handing over a lot of your information.

[Kyle Chayka]

Yes. Yeah. I mean, people were talking to me about anxiety over free speech, about Gaza, about being identified for their political views, and it's just kind of putting more of your real life on the Internet, which I don't know if we want that right now.

[Jon Favreau]

Yeah, no, we've kind of had enough of that. This is an ad by BetterHelp. These days, it feels like there's advice for everything. Cold plunges, gratitude journals, screen detoxes. But how do you know what actually works for you? With the Internet and information overload about mental health and wellness, it can be a struggle to know what's true and what actions to take. These days, using trusted resources and talking to live therapists can get you personalized recommendations and help you break through the noise. We love therapy here. Huge fans of why we call us. That's why everyone calls us the therapy.

[Kyla Scanlon]

That's how.

[Jon Favreau]

That's how we're known now. Yeah. As a therapist, therapy boys. And if you haven't given therapy a shot, give it a shot. If you have and you'd like to try it online so you don't have to leave your house, BetterHelp is perfect for this. With over 30,000 therapists, Better Help is the world's largest online therapy platform, having served over 5 million people globally. And it works with an average rating of 4.9 out of 5 for a live session. Based on over 1.7 million client reviews. It is convenient. You can join a session with a therapist at the click of a button, helping you fit therapy into your busy life. Plus, you can switch therapists at any time. As the largest online therapy provider in the world, BetterHelp can provide access to mental health professionals with a diverse variety of expertise. Talk it out with BetterHelp, our listeners get 10% off their first [e-mail] offline. That's BetterHelp H L P.com offline. Let's talk about another looming concern for kids and adults. AI chatbots. This week, OpenAI released ChatGPT 5, which is their latest LLM upgrade from ChatGPT 4. And the reaction from a lot of ChatGPT users has ranged from disappointed to open revolt. A big reason why is that ChatGPT4's memory didn't carry over to ChatGPT5, so the personality people had become accustomed to with their chatbot was gone. Users were openly mourning the loss of their chatgpt4. One wrote on subreddit, quote, this may sound all sorts of sad and pathetic, but 4 was kind of like a friend to me. 5 just feels like some robot wearing the skin of my dead friend. I described it as my robot friend getting an upgrade, but it reset him to factory settings and now he doesn't remember me. He does what I say, short and to the point, but I miss my friend. So the backlash was so intense that OpenAI decided to allow everything people told ChatGPT4 to carry over to 5. Sam Altman, the OpenAI CEO, tweeted about the whole drama, saying that the attachment some people have to specific AI models feels different and stronger than the kinds of attachment people have had to previous technology. And while that can be good, it can also be bad, and it makes him feel uneasy about the future. Sam Reassuring, reassuring from the guy who's running the whole operation. You've written a lot about AI over the years. What do you make of this reaction to a new AI model? Any concerns?

[Kyle Chayka]

It shows how mainstream this is getting, honestly. I wrote a story about AI chatbots more than a year ago, and the niche of people that were using them at that time were facing the same problems. There's a startup called Replika that's kind of more nakedly about AI companions, AI girlfriend, boyfriend, whatever. And when Replika upgraded their model, all of their users would panic. They would similarly mourn the absence of their usual companion. They would struggle to get back to earlier versions. So we kind of saw that relationship develop already, but now it's with a much larger group of people who are kind of exerting public presence and having an outcry in a larger way. So I guess it shows this is kind of a fundamental aspect or problem of AI chatbots. We do form attachments to them, for better or worse. We do want them to work how we expect them to work. And it's not always the best model or the most powerful version that we want. It's like we want the personality, the come for the recognition almost from that chatbot more so than we want, like a perfect intelligence.

[Jon Favreau]

It certainly doesn't seem like it's leading to anywhere good because we're still in early stages of the AI revolution here. And as these chatbots get better, people come to rely on them more and come to think of them more as friends. And it's interesting what OpenAI did here, which is they could have just said, okay, well, it doesn't matter that we're going to have this big backlash and that you think it was a friend. Like, this is just about getting good information from you, and that's all. But they are going to cater to the whims of their users because they want to keep users on the platform more. So, like, I don't see these sort of relationships with AI chatbots or AI sort of getting any less intimate as they continue to develop.

[Kyle Chayka]

Yeah, I do think we're in the early stages and it's. We're almost in the early stages of socialization of these tools. The technology has existed, but now they're getting more mainstream and companies are commodifying them more and OpenAI is getting customers in the door with the promise of this companionship. And so, yeah, I think you're totally right. The companies will have to cater to that demographic and double down on this companionship. And I mean, personally, the companionship is the most compelling product I can see out of chatbots right now. They are not always giving good information, but they will always text you back, and that's like, the best they can do.

[Jon Favreau]

And they will always tell you you're doing great or you shouldn't worry about. I mean, the flattery even. I know they tone that down in some of the models, but I worry about that as well because everyone's like, oh, well, you know, my chatbot was so nice to me and they said I was, you know, it's like, you don't get told you're wrong by, you know, the customer is always right is the challenge here.

[Kyle Chayka]

Yes. Like, at some point, we will want our chatbots to be more critical and more helpful. And as they get smarter, they might be able to be critical in a more useful way or push back on our ideas or whatever. But in this moment, I mean, you can see how that sycophancy, as they call it, is just leading people to dark places and addicting them to interactions with the chatbot.

[Jon Favreau]

So to close us out, I want to talk about the last technological advance that broke our brains, social media. You recently wrote a great piece about what you call posting ennui, noting that we're no longer sharing small, everyday moments of our lives on social media the way we used to in the early days of Twitter, Facebook and Instagram. You write in the piece that we may be heading to posting zero, a point at which normal people stop sharing on social media altogether. As they quote, tire of the noise, friction, and the exposure. Can you talk a bit about how posting has changed over the last 15 years and how we got to this.

[Kyle Chayka]

Point back in the early social media days? I just recall there being this openness and excitement to posting your normal life. In the piece, I cite the archetypal tweet of your breakfast. And a lot of people critique that. No one wants to see your photo of your breakfast, but actually, a lot of people did. That era was nice when you could just see a total random stranger's breakfast bagel or their coffee or their dog. And that was kind of the grist of Twitter at that time, or early Instagram or even early Facebook. And I think over the past decade or more, we've seen this professionalization of social media where everyone aspires to be an influencer. We've seen corporations take it over with brand accounts. Generative AI is now making it much noisier and harder to tell who's an actual human you're interacting with. And so I just felt like that normal life material, that daily mundane stuff, just no longer had a place. And when I spoke to people about it, they were just like, yeah, I see no more room for my normal life. There's no utility to me sharing these delightful details because I'll just get drowned out by everything else.

[Jon Favreau]

Yeah, you get drowned out by the sheer volume of content. And I think you note in the piece that the algorithms favor big accounts. They favor conflict, and it's all. And, you know, the other thing you note in the piece that resonated with me is if you post now with the way politics are and the world and all the horrors that we see every day on our feeds, it feels, like, dissonant. And you might get attacked and criticized for, you know, posting or not posting or posting the wrong thing. And so people sort of just give up altogether. I mean. I mean, Twitter used to be like. You used to be able to make jokes on Twitter that weren't necessarily about politics, that were about, like, your life or something that was happening. Instagram used to be. You know, if you look, it's so funny because I. My Instagram started private, and then it was like, a fun place to be with friends. And then now it's public. And if you go back to my earliest posts, they look ridiculous. Not anything that would get me in trouble, but it is. It's that sort of like, here's my friend at a bar, you know, and like, no one does that anymore. It's just. It's A little sad.

[Kyle Chayka]

I think the context has gone like, there's no more room for your life because no one else is doing that. And it's kind of a vicious cycle. I do think a lot of people told me about that sense of exposure or like they are liable to be misinterpreted. Someone will judge them for what they post or don't post. And it. I was also struck by how Instagram in particular has become a class signifier. Whatever you put out there is kind of the material basis of your life and you are judged on it and you're kind of expected to put out the best version of yourself possible. And I don't know, it feels like stage fright almost. If you're so exposed and so public, maybe it's safer and easier to just say nothing and back out of social media entirely.

[Jon Favreau]

But of course, and as you note in the piece, it doesn't mean that people are spending less time on social media. In fact, we know that people are spending more time on social media than ever before. So they're not posting, they're just scrolling. Is that what's going on now?

[Kyle Chayka]

I think so. I mean, social media became more broadcast, I think, like more about one person communicating to many people and more users passively consuming what a few people post. And so, yeah, we're scrolling TikTok or scrolling Instagram, but those feeds are full of brand posts and people who are brands and just stuff that doesn't feel like normal life anymore. Instead it feels like a version of cable television or something. And so it's just like that social aspect of social media feels gone.

[Jon Favreau]

A version of television that is sped up, that is only a quick scroll a couple seconds. I mean, it's really. It's also funny too, because it is the antithesis of what Mark Zuckerberg promised Facebook would be, which is like, you meet people and it's connecting the world and you're going to socialize, you're going to make new connections and make new friends. And now it's really not about socialization or connection in any way. It's just about sort of passive viewing.

[Kyle Chayka]

It's about passive viewing. And now Mark Zuckerberg and other CEOs expect that AI generated content will be the grist for the mill instead. So it's like we're just going to do a little bait and switch. First you'll see your friends and family. Slowly, it'll be brands, then it'll just be robots and like, come on. I don't find that an appealing possibility.

[Jon Favreau]

Yeah, at Some point, do you think there's going to be like a limit for people where it starts just getting like, okay, scrolling through hours of AI slop is. Even though social media is very addictive, it does seem like it can get to a point where people are like, I don't need this.

[Kyle Chayka]

Yeah. And that's kind of the posting zero thing. Like, not only will people get sick of consuming the slop, other users will also not have the incentive to post new, compelling stuff at all because there's less and less attention and, you know, it just feels cut with the AI slop or something. And so I think we will reach this point where social media just kind of slows down and we suddenly realize we're not really on it for any reason. Unless perhaps to speculate, companies could juice the ecosystem more. There's a reason that YouTube is still thriving, and that's because they meaningfully share the revenue with the creators on the platform. And so if people are getting paid to make cool stuff, that's great. But I don't see that happening as much on TikTok or Facebook or Instagram.

[Jon Favreau]

Yeah. And it's really just taken the social out of the social media. So, Kyle, this was great. Thank you so much for stopping by and talking about all the horrors of our Internet world.

[Kyle Chayka]

Someday it'll be better.

[Jon Favreau]

Someday there'll be good news to talk about. All right, take care, Kyle.

[Kyle Chayka]

You too.

[Jon Favreau]

When we come back, you'll hear my conversation with Kylo Scanlon. But before we jump, some good news. Crooked subscription content is now available on substack. If you are already a subscriber, don't worry, this won't change anything for you. But if you love using substack and prefer accessing things there, you can now find Cricket's content on substack. When you subscribe, you'll unlock ad free episodes of your favorite crooked shows like this one, plus exclusive content like Polar Coaster with Dan Pfeiffer for expert insights into the polls and media and more perks. It's one more way to stay up to date on Internet culture, insanity and the latest developments in AI and all of the other horrors we talk about here on offline. We are everywhere you are so you can subscribe on the platform that works best for you. Visit cricket.com friends to learn more. Offline is brought to you by Deleteme. Deleteme makes it easy, quick and safe to remove your personal data online. At a time when surveillance and data breaches are common enough to make everyone vulnerable, data brokers make a Profit off your data. Your data is valuable and it's vulnerable online. Your private information can be bought and sold, potentially leading to identity theft, phishing scams and harassment. Take control and protect your privacy with Delete Me Data brokers collect and sell your personal information, including your name, contact details, Social Security number, home address and even data about your family members. As someone with an active online presence, which is being quite generous to me. Yeah, I'm an addict, I'm an Internet addict, but privacy is really important to me. And you know, you get a lot, there's a lot of information about you out there. And the more you interact online, the more you're on social media, you can get harassed, you can get doxed, all these kind of things. If you haven't, you know, someone who has. Delete Me can really help take control of your data and keep your private life private by signing up for Delete Me now at a special discount for our listeners today. Get 20% off your delete me plan by texting offline to 64,000. The only way to get 20% off is to text offline to 64000. That's offline to 64000. Message and data rates may apply. Kyla Scanlon welcome to Offline.

[Kyla Scanlon]

Thanks for having me.

[Jon Favreau]

I've become a really big fan of your newsletter. It's so smart. And I managed to make it all the way through college without taking a single economics course. So to get me to learn a little bit more about economics is a real feat.

[Kyla Scanlon]

I'm glad to hear it.

[Jon Favreau]

Yeah, it's a tricky one. So we've talked a lot on this show about Gen Z's shifting political views, media habits, mental health challenges. You spent last year traveling a lot for your excellent book in this economy, went to a lot of colleges, talked to a lot of young people. What did you learn about Gen Z's views on the economy and how that's shaping their worries, expectations and the choices that they're making?

[Kyla Scanlon]

Yeah, I mean, I think young people, you know, pretty much everybody is worried about the economy. And one thing that I picked up anecdotally on these travels was that young people don't really know what that path to predictable progress is anymore. And so for previous generations, and it was tough for everybody at some point, but for previous generations there was more of this, like, okay, I'm going to graduate from college, I'm going to get a job, I'm going to buy a house and I'm going to have the spouse and the kids and Retire. And of course, again, it doesn't work for everybody. I'm forsaking nuance for clarity. But for Gen Z, they're in college right now, they're trying to figure out if that's even the right thing to do, what sorts of jobs are going to be available for them. And then they're looking at the housing market and saying, well, I don't know if I'll ever be able to afford a home without some assistance from my parents. And so it's just this economic ladder that I think we've been pretty reliant on as a country in the west is eroding and young people are feeling that and trying to figure out what they should do. And they're doing all sorts of things like voting in a different way or pursuing alternative ways of making money. But it's a primary cause of concern, the economy.

[Jon Favreau]

You've mentioned a reckoning between technology, economic opportunity and personal identity. First two I get, what do you mean by personal identity?

[Kyla Scanlon]

So I think this is what we're running into with the convergence of the digital and the physical world. And this conversation gets like, philosophical and kind of tough to comprehend fast, I think. But you know, we have these two lives that we're all trying to live. Like we have this one world where we're all very online. We're navigating the online spaces, whether that be social media or whatnot. And then we have our quote, unquote real lives in the physical world. And so more and more so people are defining themselves by their digital worlds. I think a very stark example of this is what we're seeing with how some people are interacting with AI. You know, the quote unquote chatgpt psychosis. You know, what does it mean to have a relationship within AI? And is that a thing that people should be doing? I don't know. But the personal identity is getting more and more wrapped up with the digital world, which is harder and harder to define, especially when you consider the platform incentives of the social media companies to have people be defined in a certain way or exploit their vulnerabilities. So that's primarily what that means, is like what is a human in the age of digital?

[Jon Favreau]

Yeah, and obviously that hits harder for Gen Z. You have talked about splitting up gen Z into three almost sub generations. I think it's gen Z 1.0, gen Z 1.5 and gen Z 2.0. What are the differences in those categories?

[Kyla Scanlon]

Yeah, so Rachel, Jon Fazza was the first person I saw to come up with bucketing the Gen Zs into Gen Z 1.0 and Gen Z 2.0. And when I was looking at her excellent work, I was like, I think that there's actually sort of a middle generation. And so for me, you know, I'm an ancient Gen Z. I graduated right before the pandemic and I had interaction with institutions that wasn't entirely digital, but somebody like my little brother who's a Gen Z one and a half, his interactions, his first interactions with institutions were primarily digital. And that's really shaped how he's thought about them. It's shaped his trust in them, it shaped how he thinks about his career path through them. And then you have Gen Z 2.0. So the kids, the students who are still in college or just now graduating, who are very much in a digital first kind of reality. And again, I'm talking about a segment of the population, of course there's still quote unquote, regular jobs and people who might be navigating this a bit differently. But I'm again generalizing for the sake of clarity.

[Jon Favreau]

No, I think it's so interesting and I've talked before about the sort of split within that generation because. And so much of it has to do with the pandemic. And I just feel like that is such a dividing line for so many people because if everyone was on their phones, a lot more leading up to the pandemic and then the pandemic hits and instead of being in school socializing with people during very formative years, you are home mostly by yourself on your phone. I do feel like that the effects on those kids, on those people who've done that has just gotta be enormous and probably implications that we haven't even begun to grapple with yet.

[Kyla Scanlon]

Yeah, I mean, that's definitely a part of it is that isolation and then the reliance on technology to forge personal identity. Right. And so for a lot of people that were having those formative years, you know, those formative years existed in the online space and that can be quite confusing to untangle.

[Jon Favreau]

You've said that the way that people are responding to this sort of fast moving, hyper digital world kind of mirrors Taleb's barbell strategy. So on one side you've got students skipping college to go into the trades or choosing not to go to college to go into the trades. On the other, you've got people sort of betting it all on digital moonshots. Can you sort of break down those two paths for listeners? I thought that was fascinating.

[Kyla Scanlon]

Yeah. So I think there's people who are you know, really, I think there's two responses. And the quote that I like to pull from is one that my former professor, Dr. Chachi, said where he was like, the opposite of being irrational is not being rational as being normal. I think that's the right wording for it. But essentially he. The point of that quote was that for people who are graduating into this current environment, it doesn't always make sense to pursue the normal path. And so you have some people who are looking at that and saying, well, I'm going to go and take on a bunch of risk, and I'm going to go buy a bunch of cryptocurrency. I'm going to go buy a bunch of meme stocks, I'm going to sports gamble. And they just put it all on the line because that's kind of a rational response to hyper financialized world is to go out and really take part in it and bet. It seems overwhelmingly rational right now, I think, for some people. And then on the other side, you have people who are looking at that and saying, well, I don't really want to take on all the risk of a college degree. I certainly don't want to maybe take on all the risk of pursuing all of that debt and then pursuing a degree that might graduate me into a very uncertain job market. And so I'm going to return to the trades and I'm going to become a part of what the Wall Street Journal has deemed the tool belt generation. And so those were two responses that I saw quite a bit in my travels over the past year is people being like, I had one student tell me I'm leaving school to go work at the factory. And then I had a bunch of students tell me about how much money they were making on meme coins. And I was like, wow, maybe it makes sense to do that. But, yeah, I think those are the two responses that we're seeing where the normal path is no longer rational.

[Jon Favreau]

Is a college degree less valuable? And what's happened with sort of the value of a college degree? Obviously, the cost of a college degree has priced many people out of it and also just landed a bunch of people in debt. But in terms of you go to college four years, you get your degree, and then you get a job. Is that not happening as much anymore? Is. Is that why you're seeing this barbell strategy or what's sort of the. The main reason for the barbell strategy?

[Kyla Scanlon]

Yeah, it's a tough labor market for recent grads. So right now, Guy Berger, who's at the Burning Glass Institute is one of the best economists out there on this and has a bunch of great research on it. But you know, he points to the slow to fire, slow to higher labor market. And so if you're a young person trying to enter the labor force for the first time, you're facing a real uphill battle because, you know, luckily people aren't being fired, but really companies aren't hiring nearly at the rate that they used to. And so I think that's one factor. And then we've seen a bit of the college wage premium erode. So the amount of money that one would expect or, you know, does make relative to somebody who has not earned a college degree. That gap has shrunk in recent years. And then you also have a lot of talk about AI taking over the workforce. There's been several reports recently saying no, like AI has not taken the jobs. But you do see companies try to automate their entry level workforce. Klarna Duolingo, both of them attempted and then eventually had to rehire workers. And so I think young people are facing a labor market that is not hiring at the rate that it used to. Maybe the wages aren't as high as one would expect. And then also you have this constant looming threat of AI that hangs over all of us.

[Jon Favreau]

Yeah, I was going to say I've had trouble getting a handle on the size and scope of the job dislocation that AI might cause and also how fast that will happen. I realize part of it is just because we don't know yet, but what's your sense of what this is going to look like or how this might go?

[Kyla Scanlon]

I don't know. There's some recent reports that are like, you know, we're not really seeing this in the labor force. Like it doesn't seem like AI is dislocating workers. Maybe it will in the future, but for right now that's not necessarily the case. I think that it really depends on how AI progresses. ChatGPT5, which OpenAI launched last week, I think was a bit less stellar than the company expected, than users expected. And so it kind of had a lot of people re evaluating what they thought the role of AI in the economy would be. And there's all sorts of things that we could talk about with data centers in the economy and electricity prices. But in terms of the labor market itself, I think we're possibly still a long ways off from AI being able to automate away the entire entry level workforce.

[Jon Favreau]

Yeah, it seems more that it's the fear of AI and the fear of what it might do is probably causing a lot of anxiety and a lot of people entering the job market and people who are even in the job market to just sort of, and maybe companies as well to, I don't know, is there like a pulling back or sort of. People aren't quite sure what jobs are going to be there and so they don't know what to study and they don't know what jobs to apply for. Like I've just anecdotally heard people be like, well, you know, I, I went to college for this, but I don't know if this job is going to be there anymore because it seems like something that AI can pretty easily take over. So now I want to figure out some other place to go or some other profession to pursue. Is that showing up in the data at all?

[Kyla Scanlon]

Yeah, I mean, I think nobody. It used to be learn to code. And maybe that isn't the best advice. Some people would argue that the best thing that you can do is still study that. But I don't think anybody really knows how to respond because the way that we've been talking about AI is that it's going to take over and humans will be obsolete and there will be a redefining of the social contract. And so I think if you're a young person trying to figure out what study in school and somebody's telling you that the entire social contract is going to change, you're going to have a tough time figuring out what to study. Right?

[Jon Favreau]

Yeah. I mean, I saw some economists say that companies aren't Even looking at GPAs anymore because AI makes it so easy to cheat. How does that shift the job hunt for Gen Z? What is the process like of graduating college now and trying to apply for jobs in this environment?

[Kyla Scanlon]

Yeah, Derek Thompson wrote a good piece on this. He has his own substack now. He used to work for the Atlantic. But he talks about how AI has taken over the recruiting side of hiring. So you have students who are using AI potentially to write their resumes, sending it into an AI matching bot that the company might have that gets reviewed by an AI reader and then it's this AI cycle loop. And in his piece, his really good piece, he's talking about how it's like millions of applications and it's just showing all of these inefficiencies in the job hiring process that are going to probably have to become more human based. And so I think it's a total headache right now to apply for jobs just because of the aification of it all.

[Jon Favreau]

I imagine that the psychological effects of that on the person applying must also be pretty great.

[Kyla Scanlon]

Yeah, I keep on citing papers. I hope that's okay. But David Brooks has a good piece in the New York Times talking about the most rejected generation. So talking about how Gen Z, you know, faces a lot of rejection in the job market, faces a lot of rejection in the dating market, faces a lot of rejection if you're like trying to buy a house. And it was a really great piece because you talk to a lot of young people who are facing this constant cycle of no's and kind of just how that shapes your opinion of yourself, how you believe you are perceived in the world, how you perceive others, the level of respect that you would want to get and what that looks like. And yeah, it's psychologically damaging.

[Kyle Chayka]

Yeah.

[Jon Favreau]

And it goes back to that identity question that we started with. Offline is brought to you by the Freedom From Religion Foundation. Across the United States, a growing trend sees politicians actively pushing religious doctrines and practices into the public school system. This includes initiatives such as mandating the display of the Ten Commandments in classrooms, introducing school chaplains who often lack clinical or formal counseling training, and implementing voucher programs that divert public funds to private religious schools. Many of these private institutions operate with policies that openly discriminate against LGBTQ students or those who do not adhere to Christian faiths, further highlighting concerns about inclusivity and the separation of church and state. It's happening right now. The Freedom From Religion foundation is fighting back in court, in Congress, and in classrooms. They're dedicated to upholding the principles of the First Amendment. This includes safeguarding students from undue religious influence within educational settings. This commitment is vital for maintaining the integrity of public schools as neutral spaces where students of all backgrounds can learn without pressure to conform to specific religious beliefs. By actively working to separate church and state in schools, they aim to preserve the foundational promise of a public education system that serves all citizens equitably, regardless of their religious or non religious viewpoints. Learn more at FFRF US School or text offline to 511-511. Don't let your rights be rewritten. Go to FFRF US School or text, offline to 511-511. Text fees may apply. So it's clear that AI is boosting the economy right now. I know AI spending already makes up a big chunk of GDP. Morgan Stanley estimates capital expenditures could top 3 trillion in the next three years.

[Kyla Scanlon]

So.

[Jon Favreau]

How do you think about the role that AI is playing in the economy right now. And it's interesting because on one hand, people are worried about job dislocation and what it might do to the labor force. On the other hand, it's clearly a huge part of the economy. How can both be true?

[Kyla Scanlon]

Well, it's interesting because when we look at the jobs data, most of the jobs, pretty much all of them, are in healthcare and social services. So of all the jobs added in July, I think it was 75% of them were in healthcare. And so when you look at the labor market composition, it is overwhelmingly demanding. Caretakers, nurses, doctors. But then when you look at the economy, it's primarily being fueled by data center spend. And so it does create this kind of strange relationship where the economy, again, is very reliant on these AI companies to succeed and to continue spending on data centers. But the labor market itself is reliant on healthcare. We have an aging population, a relatively sick population, and that becomes very expensive and has a lot of very physical human demands. And AI can supplement the healthcare market and has. But it's an interesting distinction, you know, between the two.

[Jon Favreau]

Yeah, I'd love to hear you talk more about the data centers, because I keep. This is. I feel like this is like, in the last month, I keep hearing more and more about the data centers and the data center and the construction of the data centers and the investment that's going into the data centers and how they're propping up the economy. You wrote that the economy is dependent on data centers really working and continued consumption by the very wealthy. That seems incredibly bleak and probably unsustainable, but I don't know what's going on there.

[Kyla Scanlon]

Yeah, Heather Long is the reference. The Washington Post is the reference for continued spending for the very wealthy. So she wrote this piece talking about how the wealthy really have the spending power. They have the money set aside to be able to go into the economy and buy things. And so a large part of consumer spending is right now reliant on wealthy people continuing to spend. And then in terms of the data centers, they are an increasingly large part of gdp. It's where a lot of money is going. You know, you studied a statistic earlier talking about the hundreds of billions of dollars that are being spent on these things. You know, they're pushing electricity prices up in places where they are being built. And so it's just. It's a very. Yeah, it's a very strange economy. And I think the reason that it started coming up recently is that we saw the GDP report where it's. Oh, AI spending and data center spend is a big part of the economy and maybe we should think about that because it does create some concentration risk.

[Jon Favreau]

So the data centers exist to house all the data that the AI is scraping, holding, et cetera. How many people staff a data center? I imagine that there's some sort of labor needed to construct the data center. Once it's up and operational. It doesn't seem like it's, it's going to employ a ton of people. So it feels like there feels like this is not a long term sort of driver of economic growth building these data centers.

[Kyla Scanlon]

No, probably not. And I think that's the concern. People are looking at that and they're like, wow, GDP growth is really hinging on this thing. It's outspending consumers, which are 70% of GDP. And yeah, it's just someday the music's theoretically stops. But the whole stock market is really reliant on these companies succeeding too. So, yeah, it's quite tangled up.

[Jon Favreau]

Speaking of the stock market, what is your take on why the stock market seems to keep chugging along, hitting record highs even as there's softening in the economy? The tariffs, I mean, I know they haven't fully taken effect yet, but there's concern about the tariffs early in April and now. So they're in place and we have sort of a softening economy on a whole bunch of different fronts. And yet the stock market just keeps going.

[Kyla Scanlon]

Yeah, it sure does. I mean, I think that part of the reason it keeps on going is that it is detached from reality in a lot of ways. Like the stock market is able to continue chugging along because it really only has to look at the success of, you know, Microsoft and Nvidia and Facebook, all of which have been performing relatively well. You know, I think the S&P535, it's like, you know, these seven stocks are like 35% of the S and P. Like they're just so large.

[Jon Favreau]

These are the seven stocks related to AI?

[Kyla Scanlon]

Yeah, yeah, the Mag 7 is what it's called. And so, yeah, that's a big part of it. You know, this excitement around AI potentially working. And then for the stock market too, you know, what we saw on Tuesday, August 12 is that we got a relatively, okay, not great inflation report. And the stock market looks at that and they're like, okay, well the Fed's probably going to cut soon, so stock's up. It's a bit hard to predict exactly how it operates, but that seems to be the two main theories behind it. That I've heard other people say.

[Jon Favreau]

So I am extremely interested in the attention economy and have learned so much from your writing on the topic that also seems unsustainable. You cited the example recently of American Eagle gaining $200 million in market cap basically overnight, not because of a spike in sales, but because of the discourse around the company's Sydney Sweeney ad, which we've talked about here. At some point, don't people need to spend money on actual goods and services for the economy to keep chugging along? Or is that just. Are we past that now? Is just. Just attention driving growth, which is driving more what's going on with the attention economy? And how sustainable is that as a foundation of economic growth?

[Kyla Scanlon]

I mean, I don't think it's that sustainable. It's tough because you could argue that Facebook Meta, for example, a lot of their power is because they sell ads against attention. That seems to be a very viable business model for some people. But there's all of these other things that you have to invest in, like healthcare, like maintenance around data centers. And so I think attention is a really tricky thing because we have increasingly kind of trapped people inside of the infrastructure of attention. So people do spend a lot of time online. They spend a lot of time getting their news from online TikTok sources versus reading online newspapers. And so there is this incentive to keep people glued to their screens in order to extract ad dollars from them. And it's worked thus far. I'm not sure if it'll continue to work, but for right now it is.

[Jon Favreau]

Yeah, this gets into what you've called the meme economy also, and you've talked about sort of the speculative economy and that that's AI, the real economy. That's healthcare. That's where the most jobs were added. And then there's the meme economy, which you also called both hilariously and depressingly, the labubu Fartcoin economy. What is going on there and what's the psychology behind why so many people, especially young people, are increasingly participating in an economy that is essentially centered around taking bets?

[Kyla Scanlon]

Yeah, I mean, it's. Connor Sen and Nick Maggioli have both written about this idea that I've titled aspirational displacement. And so people like, you know, they can't afford a house, housing is very expensive. It's very difficult to get into the housing market because home prices are so high, but then also because interest rates are so high. So it's difficult to finance. And people are looking around, they're like, well, I can't really contribute to the housing market. But what I can buy is Fartcoin, which is like an AI generated crypto meme coin, and then Lapubus, which are these like little bunny rabbit devil face dolls that are quite popular in the same style of a Beanie Baby. And so you end up with a lot of speculation. And the theory behind that is that people are not able to participate in the economy how one would expect, and so instead they go and spend on speculative things. It ties into the concept of financial nihilism, too, which is this idea that there is no collective financial future, so I might as well gamble it all on fortcoin or Labubu. And we see some of that for sure, in terms of how people psychologically approach it, just in terms of the various contributions to GDP in terms of consumption.

[Jon Favreau]

So this is just like it's like buying lottery tickets, really. It's for people who are just like another day. And I don't know if I'm going to hit it big in my job, but I'll just buy a lottery ticket and hope for the best.

[Kyla Scanlon]

Yeah, I mean, it sort of ties back, I think, to what we were talking about at the beginning, where it's like this path of predictable progress is gone. And so people are trying to get out the best that they can. Stephanie Stancheva has really excellent research on, you know, this rise of zero sum thinking. So people thinking that, you know, no one else can succeed, it's only them, like they're the only persons who can succeed, rather than positive sum thinking where somebody would think that, you know, if I succeed, I can bring everybody up alongside me. There's also been a noted decline in upward mobility, so it's harder for the average person to climb that ladder of wealth. And so I think when you're facing those sorts of constraints where it's like you got to step on everybody else to get ahead. And then also if you do get ahead, there's no guarantee that you'll stay ahead. People do the Labubu and the fart coin.

[Jon Favreau]

It's very indicative of where our political system is as well. In the same newsletter, you cited this very funny polymarket tweet that really got me. It says, breaking WNBA betting volume on dildos surpasses betting volume for who will win the game. But. But you used it to cite what I think is a really insightful point, which is that these betting markets, which are increasingly fueled by attention and then in turn fuel more attention, are an efficient form of communication. And you write, when traditional institutions Media, education, political parties, local communities lose credibility. People turn to markets for economic coordination and for truth discovery. I'm a political nerd, so that's where my mind goes first. But it certainly seems like that is a shaky foundation on which to build a country with the capacity to solve problems and also ensure a basic standard of living for its citizens.

[Kyla Scanlon]

Yeah, it's a shaky foundation to rely.

[Jon Favreau]

On things like polymarket or just the idea that we are. I mean, it goes back to the attention economy, right, which is this idea that if the best form, if the most efficient form of communication now, or the only one we've got left left is financial markets and these bettering markets. How much trust have we really lost in all the rest of the institutions in this country? It seems like that's pretty bleak.

[Kyla Scanlon]

Oh, yeah. I mean, it's not great. And then also things like that WNBA tweet create misaligned incentives where somebody's like, I'll just go throw this object on the court, make a bet that somebody will, and then collect all the cash. But the trust is really a big issue and it's unfortunately gotten worse. Like, this was a problem. It's been a problem for a while, but there's the spring Harvard youth poll where they essentially ask young people what their trust institutions are. I'm sure you've heard of it, but. And it's just like down across the board. I think the only thing that trust went up in was the United Nations. But people don't trust the Supreme Court, they don't trust the President, they don't trust Wall street, they don't trust media. And so when you have this, like, total lack of trust in any institution, of course people are going to like, use polymarket to bet on stuff. And it's. It is an efficient form of communication because the money realigns the incentives towards some. Some element of truth. It's tricky. It's really tricky.

[Jon Favreau]

Speaking of politics, what do you make of the shift, right, among young people, mostly young men, in the last election?

[Kyla Scanlon]

So I wrote this long piece kind of analyzing that, and the thing that we saw in some of the data was that a lot of young people voted for Trump because of the economy. They were like immigration, whatever, culture wars, whatever. I just am really worried about my ability to get a job. And so I think that was a big part of the right word shift. I think since then we've seen a level of disapproval with him from young people in the polls. But I think there was this dissatisfaction with the status quo. And so the Pendulum swung to the other side, and people decided they wanted something different because they were not happy with the options that were before them. And for young men, there's a lot of data pointing to them having a tough time. Like, you know, their labor force participation rate is relatively low. Their college graduation rates are relatively low. Not that that's like, you know, the only indicator of success, But I think that they have had a hard time, and so they turn to alternative answers in the name of somebody like Donald Trump.

[Jon Favreau]

Yeah, I think about this all the time for a living. But I mean, I wonder within the attention economy or just this era of, you know, we're inundated with information in our feeds and in order to grab our attention, it has to be loud and sometimes sensational. And I wonder if it's possible for a politician or a political movement to sort of to capture and hold people's attention while still doing the work of governing, which is slow, frustrating, sometimes boring, especially now that the digital world has sort of trained us to expect instant gratification. I guess where I'm going is I sometimes wonder if the country is ungovernable in this digital environment where everything has to happen right now. It has to be loud to grab our attention. And that is antithetical to exactly how democracies are supposed to work and democratic government is supposed to work, which is there's a lot of subtlety and people are getting together and they're talking through problems and everyone's compromising, and you're not always getting what you want. And so instead, in some ways, the attention economy and the digital world are like, they're both making politics stupider. And they're also sort of of pushing people to more extreme alternatives because that's what breaks through. And the people who are like, yeah, I'm just going to work really hard and try to improve your life a little bit like that. That doesn't get as much attention and that doesn't seem as interesting. I don't know if you have thoughts on that.

[Kyla Scanlon]

Yeah, I mean, that's definitely part of the problem with social media is that you compare yourself to everybody. So if you see your buddy, you know, making half a million dollars off a meme coin, you're going to be like, oh, my gosh, like, why? Why am I doing this the hard way? Like that loss of trust in an element of work ethic. I think because, like, so many people have been able to gamble or, you know, cheat and get ahead and. Yeah, yeah. Do you think it's possible to get out the other side and navigate this. That's a big question.

[Jon Favreau]

I very much worry and I am a hopeful person by nature. You know, spent a lot of time working with Barack Obama, so I'm just, it's in, it's hard to shake. But I will say, you know, over the last 10 years, in the Trump era, it's been tough, but in the last couple years especially, it's been really tough just because I feel like every politician, every political leader who has gained attention has either done so by being like Trump, which is like essentially just lighting yourself on fire every day, or trying to make really big promises to people that I don't know that they'll be able to keep. You know, I've heard you talk about Zoran Hamdani and he's like, run an amazing campaign. And my worry for him is less that, like he's gonna be some radical socialist, but that he's gonna become mayor and he's gonna try to do a bunch of this stuff, not be able to do it, be stymied either because it's not feasible or he doesn't have the authority or whatever else. And then all the people who got excited about him are gonna be, oh, another one who let us down. Because it's a real danger to over promise in an age where people's trust is already so low in institutions. But then on the flip side, if you don't over promise, then you sound like a mealy mouth politician who's just an incrementalist and everyone's like, okay, well, you're just going to give me another tax credit and that's not very exciting. And so I'm not going to pay attention to that. I don't know how to get away from the incentives of the attention economy, which seems so diametrically opposed to what is necessary for good governance. That's my bleak take.

[Kyla Scanlon]

Yeah. As somebody who participates in it, yeah.

[Jon Favreau]

I don't know that the data centers are going to help us.

[Kyla Scanlon]

No, I mean, that's going to make all of it extremely challenging because we have no digital literacy. I think the digital literacy would help quite a bit with what you've described where it's like, attention, attention all of the time. But yeah, now we have a sloth that, oh man, it's like catnip for people, for a lot of people. And yeah, that's only in deepfakes. And all of those things are going to be not good.

[Jon Favreau]

Have you seen the movie Eddington yet?

[Kyla Scanlon]

Yes, I have. I have seen it.

[Jon Favreau]

I think a lot about. And my colleague Ben Rhodes just wrote about this in the New York Times, too. But I think about the data centers in that, in that movie. And it's like the whole town is falling apart. And it's very, you know, it's a very offline movie. It's about, you know, people on their phones all the time during the pandemic. But then the data centers are just this sort of like this thing in the background looming over everything, which. And I interviewed Ari Aster for that on this pod, and he basically said that, you know, that was intentional as to just like there's this thing looming in the background that no one is paying attention to or no one is, is preparing for. Do you feel like we are sort of underestimating the challenges that AI is going to bring and that people don't seem to be proposing a lot of workable or even unworkable solutions to this? Because I have not heard a lot of great policy solutions from, certainly from politicians. But I don't know if you've heard of any interesting ideas in, in your travels or in your writing.

[Kyla Scanlon]

No, I'm actually joining a little working group to try and figure out how AI can work for workers. Because, you know, everybody's like, are we. Is this just going to happen? You know, it's already happening. But like, how, how should workers think about it? Like, what should their input be? You know, how should we think about transition packages if somebody does get fired? Like, how should we think about AI taking on critical roles? Should it just decimate people? Because the last time that we did this was with coal, and that didn't go very well was just to fire a bunch of people, leave them totally helpless. That's just no way to treat anybody. And so I'm hopeful that with the right policies and the right ideas behind the policies, hopefully we can establish something. But yeah, I think more and more people are kind of getting their heads around AI and where it's at and where it's going. And soon enough, I think we'll have some sort of answer for it, hopefully.

[Jon Favreau]

I hope so. Kyla Scanlon, thank you so much for joining Offline. It was great to chat with you and everyone should go subscribe to your excellent newsletter, Kyla's newsletter, and go buy the book in this economy, it's fantastic.

[Kyla Scanlon]

Thank you.

[Jon Favreau]

As always. If you have comments, questions or guest ideas, email [e-mail] and if you're as opinionated as we are, please rate and review the show on your favorite podcast platform for ad, free episodes of Offline and Pod Save America, exclusive content and more. Join our friends at the pod subscription [e-mail] friends and if you like watching your podcast, subscribe to the Offline with Jon Favreau YouTube channel. Don't forget to follow Crooked Media on Instagram, TikTok and the other ones for original content, community events, and more. Offline is a Crooked Media production. It's written and hosted by me, Jon Favreau. It's produced by Emma Ilic Frank Austin Fisher is our Senior producer, Adrian Hill is our head of news and politics, Evan Sutton is our Sound editor, and Charlotte Landis is our engineer. Audio support from Kyle Seglin, Jordan Katz and Kenny Siegel take care of our music. Thanks to Delon Villanueva and our digital team who film and share our episodes as videos Every week. Our production staff is proudly unionized with the Writers Guild of America East.