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- [00:01]
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- [00:27]
Stephen Overle
Hey, welcome to POLITICO tech. Today's Monday, December 23rd. I'm Stephen Overle. Senator Mike Rounds is an influential voice on two policy issues that we talk about a lot here on the artificial intelligence and cybersecurity. And with Republicans soon taking control of the Senate, his power will only grow in the new year. Rounds tells me when it comes to AI, he doesn't want Congress to bog down companies with regulation. In fact, he wants to convince his Republican colleagues to spend billions to fuel their growth. But when it comes to cybersecurity, companies may need new rules forcing them to better protect their data and networks. Oh, and I asked him about Elon Musk's influence over his party these days, and he had a message for colleagues feeling the pressure. Here's our conversation. Senator, welcome to Politico Tech.
- [01:34]
Senator Mike Rounds
Thank you. Appreciate the opportunity to just visit for a while.
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Stephen Overle
Of course, I know you're having conversations these days with a lot of the nominees that President Elect Trump has put forward. I'm sure you're talking with the transition team when you talk about priorities for next year. To what degree do AI or cyber, some of these tech issues you focus on come up.
- [01:53]
Senator Mike Rounds
It's not so much of focusing on them, it's a recognition that they will be a part of the discussions. You know, our focus has been on, number one, making sure that the president can have a successful 100 days, that we get his team in place so that he can effectively start to govern and then to literally get the economy rolling again as well. But along with that, we have to continue to make improvements to stay ahead of the bad guys that are out there that love to get into our systems here. And then with that, also you talk about the intersection of artificial intelligence or AI with cyber.
- [02:28]
Stephen Overle
Right.
- [02:29]
Senator Mike Rounds
And so forth. And this is a huge thing and it's not something that you wish for. It is simply the reality is it's for real and it is happening today. We're ahead of our adversaries right now with regard to the vast majority of areas that AI is being implemented in, but we're not that Far ahead of them. And this is a race that doesn't have an end in sight, but we have to win it for a couple of reasons. AI will drive economic development in the United States and throughout the world over the coming number of years. And that's not five and six years away. It's happening now, Right? So we've got to be the innovation capital of the world with regard to AI, and we've got to be the implementation capital of the world, implementing it into our business community. And the business community is accepting that. The other piece is in our national defense. We currently use artificial intelligence in our defensive capabilities on most of our ships. But there's more to it than just that. In all of our space activities, artificial intelligence is playing a part, and it's going to continue to grow in our offensive capabilities. As much as people talk about you don't want AI in terms of making a decision to be offensively effective or to be offensively involved.
- [03:46]
Stephen Overle
Right.
- [03:46]
Senator Mike Rounds
The reality is it will be, and our adversaries will be doing it. We have to be in a position to counter that. So artificial intelligence is being used on the battlefield right now in Ukraine by Ukrainians and by Russians. We've learned a lot from that, and it's here to stay.
- [04:02]
Stephen Overle
I imagine you're getting a lot of questions these days about Elon Musk. And so I'm going to ask you one myself, which is we're already seeing Elon Musk have a lot of influence on this incoming administration. Some of its agenda, certainly influence here on Capitol Hill. Is that a good thing?
- [04:17]
Senator Mike Rounds
You know, he brings a wealth of new ideas. A number of his ideas are refreshing with regard to finding efficiencies. The fact that he has been a successful businessman and he's an effective and capable technically adept individual, can be very helpful. And with regard to our space programs and so forth, he's learned a lot about it already. He can help the administration stay on top of it and move forward quickly with regard to the layout of a business community. It's different than what you do in government, but there are some things that are going to be similar. He is engaged right now, which adds energy to the system. I met him once, and that was when he actually came to one of our AI seminars that we invited him to, along with a number of other key individuals in the development of AI.
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Stephen Overle
How was that?
- [05:06]
Senator Mike Rounds
It was great. He interacted with the rest of the team, the folks in there. And it's one of those things where, you know, I come into this was like a Third grade level. And to have these other folks come in and start talking to us and other members of the Senate and our staffs about the direction of AI we did this nine times. It was a bipartisan effort by Senator Schumer, Senator Young, Senator Heinrich and myself. And he came in and he participated like everybody else did. And it was great to have that interaction. And to listen to these folks talk to one another at a level that we very seldom get a chance to eavesdrop on was just great. And so I came out with a positive attitude to begin with on them. And I know that some people out there are saying, well, he's putting pressure on everybody.
- [05:46]
Stephen Overle
Right?
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Senator Mike Rounds
That's nothing new. We get that kind of pressure on a regular basis. It's not to be unexpected.
- [05:53]
Stephen Overle
Even when it's the richest guy in the world and 200 million Twitter followers.
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Senator Mike Rounds
Well, look, I mean, it's pressure, but, you know, if you can't stand the heat, get out of the kitchen.
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Stephen Overle
Right?
- [06:03]
Senator Mike Rounds
And so, you know, look, we're. We're all on the same team, and we're all moving in the same direction, at least Republicans in the. In the House and the Senate. I really do believe we're on the same team. We're trying to get things done. We want this new administration coming in to be effective. We want it to be successful. If they're successful, I truly believe the country's going to be successful. And if you take a look at it so far, what he's done, you know, President Trump suggested he was gonna put tariffs on Mexico and Canada. And lo and behold, he didn't have to put a single tariff on anybody. And he had the leaders of both Mexico and Canada coming in, visiting with him already.
- [06:41]
Stephen Overle
You know, to just play devil's advocate with you here on Elon Musk really quickly, you know, he's not an elected official. He's not technically a government appointee, at least not at this point. Do you worry about accountability? You know, we have checks and balances. Is Elon Musk accountable to you and your colleagues here on the Hill?
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Senator Mike Rounds
He's not accountable to us. We're accountable to the people that elected us.
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Stephen Overle
Right.
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Senator Mike Rounds
He most certainly, I think, would assume that he is accountable to the president because the president is the one who is, you know, allowing him to advise him. The president is listening to what he has to say, but he's accountable to the president, and I think he would acknowledge that.
- [07:26]
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- [07:54]
Stephen Overle
The issue of AI, which you know, as you said, has been a priority of yours for at least a year and a half now, if not longer working in a bipartisan way. There were some efforts to pass legislation this Congress, most of that didn't quite make it through. Some Democrats have put blame for that on Republicans. I wonder, if you were to kind of diagnose why some AI legislation didn't make it to the finish line, what would it be?
- [08:17]
Senator Mike Rounds
To be honest, I don't think it's a matter of failing. I think it's a matter of the approach that we've all taken. We decided early on that if we're going to be long term successful in the implementation of good AI policies, that it had to be done using the committee structure through what we call regular order. Now, the Senate's not real good at regular order. We don't do much of it that way. But we need to get back to that. And if we want to have bipartisan good policy made, it starts with getting the committee chairman involved and the ranking members involved, having open hearings on these ideas that, you know, really do impact a huge amount of our daily lives. I mean, let's just think about it. You've got a Commerce Committee that's going to be looking once again at whether or not social media has a place and what place it is and how you protect against the invasion of privacy by social media. Right, but, but that means you got to have the expertise from that committee involved in talking about how AI interacts with social media. Let's take a look at, you know, what we do in the Department of Defense. That wouldn't be anything that should be handled outside of going through the Armed Services Committee. And with regard to patents and copyrights, perhaps it's coming out of Commerce, perhaps it's coming out of the Judiciary Committee. It would be foolish for us to say that one size fits all and we should write one bill that's trying to do all of this stuff. We could do way more damage than good. So the approach that we've taken is AI is here. It's for real. Let's make sure that we do everything we can to incentivize the production of it here in the United States and then give us a chance then to make sure that it's implemented in such a fashion. The American people say, you know what? This has improved our quality of life. And I'll just give you one example that I think will. Will be worth everything we're doing. Health care. I truly do believe that implementing artificial intelligence with biomedical research will save millions of lives and extend our lives for years. I believe that with regard to diabetes, we can cure it. I believe that with regard to the vast majority of cancers that afflict us today, once we invest appropriately, billions of dollars, not hundreds of billions, but billions of dollars, 35 to 40 billion over the next four to five years, we can probably cure the vast majority of cancers that we worry about today.
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Stephen Overle
And so, with Republicans calling the shots around here, starting in January, where do you start? What legislation do you think can get done?
- [10:52]
Senator Mike Rounds
You continue it on a bipartisan fashion, because whatever we do right now, we continue to do in a bipartisan fashion. The first thing you do, I believe, is you lay out the. That AI is welcome to be developed in this country and that in some cases, when you're on frontier models, the most advanced models, and by the way, what was an advanced model six months ago may not be an advanced model.
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Stephen Overle
Now, they're developed real fast, very rapidly.
- [11:16]
Senator Mike Rounds
But that they are welcome to be here in the United States. And that while we want to be informed at the national level, we're not going to be dictatorial at the national level. That could restrict your ability. Second of all, we want to make sure, though, that on those frontier models that we have a market for them here in the United States so that you do not have to, nor will you be allowed to market them to our adversaries so that you have the market here. It's worthwhile to develop it. But there are going to be some restrictions on those frontier models. The other part of this is on the implementation of it. You've got to allow the business community to implement the use of artificial intelligence along the way, and you can't have such a restrictive environment that you stop them from incorporating it. I think the golden rule is if something that a business community would do today is legal, incorporating artificial intelligence does not make it illegal. On the other hand, if something today is illegal to do, using artificial intelligence does not change it from illegal legal.
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Stephen Overle
Not a get out of jail free.
- [12:18]
Senator Mike Rounds
Card, not a get out of jail free card. But there has to be accountability for what does occur with the development of artificial intelligence.
- [12:27]
Stephen Overle
You mentioned the Senate commerce Committee. Obviously your Colleague Senator Ted Cruz is going to hold the gavel there. What conversations have you had with him about AI in the new Congress?
- [12:36]
Senator Mike Rounds
Well, they're in the middle of it. I mean, look, they get it already. They have already introduced some legislation. Right now. I have full confidence that the Commerce Committee will have great hearings and that you will see positive developments. But the developments will be to incentivize the use of artificial intelligence and at the same time, to protect the privacy of individuals that are out there. And by the way, sometimes I think we get carried away and we forget that there's a difference between infusing artificial intelligence into social media and so forth, and the regulatory aspects of social media, with or without artificial intelligence. And I'm going to specifically talk about section 230 right. Of the bill right now, which has caused great concern, because what we did to begin with when the Internet was created, we basically said, look, if all you're doing is carrying content, it's okay. You're not going to get sued for what that content is. But today there have been changes in the way that's been done, and we need to rethink how we look at protecting the public from some of the content which is actually being carried by Internet providers. And who should be responsible for that.
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Stephen Overle
Does that mean rewriting section 230?
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Senator Mike Rounds
Well, it does mean modifying section 230. I think there's a broad consensus on that. But once again, this. That's the reason why you want that in the Commerce Committee, because they have the expertise, along with perhaps the Judiciary Committee, with input about the appropriate way to do that. It doesn't have to come from the Armed Services Committee. So there is a separation of knowledge and a separation of the roles there that I think is important, but it's also a benefit to us.
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Stephen Overle
You're going to be holding the gavel yourself. On the Armed Services Cyber Subcommittee, there's this ongoing attack on US Telecommunication networks led by the Chinese hacker group Salt Typhoon. How well do you think that's being handled? You know, what grade would you give it, and what do you want to see done differently?
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Senator Mike Rounds
This was a real failure on the part of the business community, where the basics of cybersecurity just simply were not followed.
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Stephen Overle
Was that surprising to you?
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Senator Mike Rounds
It was very surprising to us. They have been able to infiltrate and to get into the very bowels of the connectivity within the Internet itself. The routers that they use, they have been in and they have infiltrated. They have the access the Chinese government has had the access to. If they want to listen to lots of millions of individuals, phone calls. They've been able to read texts and so forth. We don't know to what degree they've actually done, but we know that there have been individuals, particularly within the D.C. area, that they have had a keen interest in. Those individuals have been notified and we know that they listen to their phone calls. Now, we don't know how advanced their technology is with regard to how much they could actually collect and then analyze later on, or if they had to be on the line and listening specifically, or how much metadata they actually collected and will have the time to, to go through and sort through. But we know they've had access. It's been very, very frustrating to see that occur. But this is not a case of where we should simply stand back. And I mean the old adage of if you live in a glass house, you shouldn't throw bricks. The same thing here. We've got to be very careful with regard to all of our cyber activity. We should never be complacent. We should always be challenging whether or not the cyber systems that we've got are up to speed. And for those professionals that claim to be the security experts, if they're not getting updates all the time on what the newest risks are and so forth, then we're in trouble.
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Stephen Overle
Is that something you can legislate or what's the role for you and your colleagues in making that happen?
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Senator Mike Rounds
I think there's going to be on the part of members of the Senate coming together and finding a path in which we talk about the minimum amount of security that's got to be included by these big telecom organizations, just as an example. But it goes beyond that. There's going to have to be a minimum amount of cybersecurity that larger organizations are going to have to be responsible for, including within their own stuff, or they're going to be held accountable for it. If you're a financial institution, the vast majority of the financial institutions do a great job of keeping the bad guys out of their customers or their client's business. But it's never ending. The same with box stores. If you're a major box store and you're doing business and you're using the Internet, which they all are, you better darn well be doing everything you can to protect the information that you require a customer to give you. If they're doing business online with you, this is a never ending battle because these people, these cyber experts come to where they can find the money, and that's in the United States. So they're coming after our stuff because this is where the money's at. I would also share that we do our best within the Department of Defense to find these guys in advance and try to stop them. It's kind of like, where does the guy that shoots the arrow stand? Well, if they stand in Western Asia and they're shooting arrows at us, we have an obligation to try to stop the arrows. That means stopping some of the cyber incursions to begin with.
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Stephen Overle
Right. If some of your colleagues come to you, especially on the left, and say some of the biggest businesses are not taking cybersecurity seriously enough, we need to regulate, your response to that is what.
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Senator Mike Rounds
Look, if they've got ideas about how to appropriately regulate, fine, but it's got to be one. It really has not been a left or a right thing. It's been people coming in saying, gee, the organization, let people in. What are we going to do? It's not a matter of being left or right. It's a matter of protecting the American public. And that goes for people across the political spectrum. Now, some people can say, you know, well, they're only profit oriented. I can assure you there is not a business out there that would do anything to avoid a cyber incursion.
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Stephen Overle
It's not a good look for them.
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Senator Mike Rounds
It is extremely expensive and it is terribly embarrassing. So everybody wants to keep the cyber criminals out. It's a matter of have they taken the time and have they invested the money and have they done a good job and are they prepared to get back up, you know, to fix it, to rehab their system and then to make their clients whole again? And those are all parts of a discussion that they have, what we hope to be a regular basis.
- [19:01]
Stephen Overle
You know, you mentioned some of the military's efforts around cyber defense, cybersecurity. I'm curious. There's been talk of, you know, of the Trump administration making changes perhaps to the U.S. cyber Command, you know, restructuring potentially leadership and elevating it within the military. Have you had conversations around that? And what do you make of sort of changing the structure here?
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Senator Mike Rounds
Well, you know, we're always open for ideas about way to make things more powerful or at least more efficient. Today we have US Cyber Command, which is under the auspices of a four star general. He is also wearing another hat, which is, he is the head of nsa. We call that a dual hat position. I think that has been an extraordinary, extremely effective way of handling the cyber issues and also at the same time making the coordination between NSA and cyber teams. Here's the rub. NSA works quietly. They want to be everywhere they possibly can be to observe and to collect data on our adversaries and around the world. They don't like anybody saying that they're successful. They don't like anybody finding their tools. On the other side. You have Cyber Command. Their job is not only to defend the dodin or our Internet.
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Stephen Overle
Right.
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Senator Mike Rounds
But they're also responsible for creating the offensive capabilities as well. You can't do that unless you either recreate the same kinds of tools, which would be more expensive. But what happens if you coordinate, you have the tools and then somebody makes the decision? They call the shots about whether they put a tool at risk of exposure. But that makes a difference in the defense of our country. That's the trade off that we have to have discussed. Now, if you had two separate entities, you'd still have to have somebody being an umpire. And that takes time. But we've done a number of changes over the last couple of years to make that decision making process more effective. I'm not going to get into more than that. I'm just simply going to say that those efficiencies have been an ongoing process and a number of those efficiencies did occur during the previous Trump administration. So, you know, look, if there's new ideas out there, I'm all open to it. But if it's a matter of change, for change's sake only, that's different. But if we can make things more effective, more powerful, I'm all in favor of doing it.
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Stephen Overle
You know, there is an expectation that Republican controlled Congress is going to cut back on spending. A lot of the priority areas we're talking about AI cybersecurity. There's talk of investment, the AI roadmap, $32 billion for AI R&D. There's talk of need to ramp up investment in cyber defense. How do you convince your colleagues to spend in these areas? And is that something you're even planning to try to do?
- [21:50]
Senator Mike Rounds
I'm absolutely trying to do it. And the reason is because if I can save $200 billion over a three year period of time by investing $30 billion up front, I'll take that deal any day. But I'm also convinced that if we really want to eliminate our deficit, you've got to have efficiencies within government. You have to eliminate some of the agencies that are out there. You have to combine some agencies. I am all in favor of eliminating the Department of Education. And I'll tell you the reason why. I can move all of those offices, the important offices, special education, you know, Native American education, even the student loan programs, I can move those back to where they were before that department was made and save billions of dollars in overhead. So in those areas, man, I am all on board now when we talk about investing money. If we can invest money in health care and end up saving money in health care, why wouldn't we want to do that? And I'll give you a really good example, okay? It used to be that if somebody had an ulcer, they would have stomach surgery. Think about, number one, the quality of life you've just impacted by making them go through a stomach surgery. Number two, think about the cost of that surgical operation. Compare that with taking a pill today. Now, that's a transfer over 20 years that has turned around the lives of a lot of people, saved a lot of pain and suffering to a lot of people. Was there an investment in creating that pill in the first place? Absolutely. But think about the savings in the surgeries since then that have occurred. The same thing can go on with regard to the curing of cancers, the delay of cancers, and then just think about what happens for quality of life if we're able to identify and delay the onset of Parkinson's disease and Alzheimer's. Think of the quality of life. That, to me, is the real key here in the development of artificial intelligence that people will see before they see any of the rest of the activity, except perhaps on social media.
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Stephen Overle
Right. I mean, to get your colleagues to see that vision. I mean, how easily are they buying into it? Do you have to twist arms?
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Senator Mike Rounds
You can't do it alone. You need other people to see it and to believe it as well. You need the medical practitioners to come in and say, look, this is for real. They're not going to believe one member of the Senate. My job, as I see it, is to coordinate, to send that message and to have people start to believe it and to start seeing it. And if we can show successes in particular areas, then we can get this done. The other piece on this is, we can't continue to try and sustain the deficits that we've got right now. We're going to have to grow this economy. If you talk to anybody out there in the tech world, they will tell you that artificial intelligence will make us money. If we do it correctly, we will become more effective. We will be more profitable with artificial intelligence included in it. If you talk to people within government and they talk about the efficiencies within government, artificial intelligence can, if properly done, make us a much more efficient government as well, with oversight. And this is money that if you save it at the federal level, it is money that literally we don't have to borrow. And that's our goal is develop the economy, make us as effective as possible in our defense, but improve quality of life and be more efficient in the delivery of healthcare services.
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Stephen Overle
Senator Rounds, thank you for being here on Politico Tech.
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Senator Mike Rounds
Thank you.
- [25:28]
Stephen Overle
That's all for today's Politico Tech. Politico Tech will be on a holiday hiatus until Monday, January 6th. Until then, please catch up on any episodes you may have missed and be sure to subscribe on Apple, Spotify or your preferred podcast player. Our managing producer is Annie Reiss. Our producer is Afra Abdullah. I'm Stephen Overlea. Have a happy holiday season and I will see you in the new year.