Tyler Cowen Doesn't Think America Should Ban Chinese AI Models

Summary

Podcast Episode Summary

Podcast: TBPN
Episode: Tyler Cowen Doesn't Think America Should Ban Chinese AI Models
Date: July 20, 2026
Duration: ~35 minutes
Host(s): Jordan Weissmann, Kyla Scanlon
Guest: Tyler Cowen (Economist, Professor, Blogger)

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Episode Overview

This episode welcomes economist Tyler Cowen to discuss the intersection of technology, economics, and policy—with a focus on the controversial debate around banning Chinese open-source AI models in America. The discussion branches into trade policy, economic "vibes," AI's impact on entrepreneurship and labor, the new "AI maniac" archetype, the rise of sectoral shifts in the workforce, and broader cultural changes. Cowen’s nuanced views provide a counterweight to prevailing narratives about technological protectionism, labor market peril, and the shifting meaning of work and status in the AI age.

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Key Discussion Points & Insights

1. Coffee Rituals & Human Habits

• The episode opens with Cowen humorously describing his abstinence from coffee, linking it to habits and supply chains.
  • "I've only had coffee twice in my life, both times in rural Ethiopia in a coffee ceremony. And it was amazing. But I thought, this is the peak. I can't beat this." (Tyler Cowen, 00:17)
• The conversation segues into the nature of ritual and economic choices, using coffee as a metaphor for broader economic behavior.
  • "Caffeine pills are incredibly economically efficient... People just can't stop paying for [coffee]." (Jordan Weissmann, 00:58)

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2. AI Policy: The Futility of Banning Chinese Open-Source Models

• Cowen argues a ban on Chinese AI models is both impractical and counterproductive.
  • "The attempt to outlaw it or ban it or use sanctions against it is going to fail miserably." (Tyler Cowen, 01:51)
  • "What about multinationals? What about companies whose affiliates use open source? What about all the major US Companies that use open source?" (Tyler Cowen, 01:51)
• He pleads for policymakers to abandon this unworkable approach.
  • "I hope. I plead that The Trump administration gives up on this crusade. It cannot work." (Tyler Cowen, 01:51)
• Counterpoint: infrastructures—server hardware, data centers—are still chokepoints, but Cowen notes that on-device AI will soon undercut these.
  • "What will you do when it's on device? How long is that from now?" (Tyler Cowen, 03:05)

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3. Trade, Tariffs, and Global Competition

• Examining lessons from automotive tariffs, Cowen is skeptical about using protectionism to stimulate local industry.
  • "If Europe starts a major trade war with China, Europe will lose... Putting up big tariffs isn't going to help them get there." (Tyler Cowen, 03:50)

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4. The AI & Tech Stack: Data Centers, Chips, and Infrastructure

• The discussion explores whether the U.S. risks outsourcing not just AI models, but the entire AI stack to other nations due to local resistance to infrastructure.
• Cowen supports the domestic growth of data centers and chips, both for economic and security reasons.
  • "I live right next to all the data centers in Northern Virginia. It's great. They pay for half of the taxes of their county... bring it on." (Tyler Cowen, 05:21)
• Open-source AI as a strategic complement, not a competitor, to proprietary American platforms.
  • "If there's open source as something in the background, people are more willing to lock into our systems to a partial extent." (Tyler Cowen, 05:40)

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5. Economic Negativity & the “Vibe Session”

• Cowen analyzes current pessimism as a form of "negative emotional contagion."
  • "Maybe it is some negative events, but once it gets going, it's hard to reverse. Sometimes you need actually a war or some kind of catastrophe." (Tyler Cowen, 07:40)
• The paradox: If a mild recession occurred, the U.S. might become more resilient by finally matching perception and reality.
  • "If we actually were to go through a brief recession or a market correction, we might be a more resilient country... Finally, I'm justified in thinking things are bad." (Jordan Weissmann, 08:09)
  • "One hopes, yes, it could be a bullish signal, but then again, if something terrible does happen, everyone says I told you so and maybe we get stuck in the mire." (Tyler Cowen, 09:01)

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6. Impact of AI on Growth & Productivity

• Cowen finds confirmation that AI, like past tech, boosts growth incrementally rather than revolutionizing overnight.
  • "If we had Fable 5, I would have thought the world would be totally different. And it's not... Over time, with some slowness, we'll get that and maybe a bit more, which is great." (Tyler Cowen, 09:39)

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7. Culture, Technology, and Sports

• Short takes on The Odyssey film ("fantastic... but... a disappointment" — 10:17), classicists' delight in adaptation, and the homogenizing effect of tech on sports.
  • "Technology in some ways has made basketball worse... Teams have less individual style." (Tyler Cowen, 11:23)

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8. Rise of the “AI Maniacs” & Youthful Innovation

• Cowen describes the rise of "AI maniacs"—youth who self-train, innovate, and outpace institutions.
  • "They realize this is the future. You're going to have a large number of companies with quite a very small number of employees but pretty high revenue." (Tyler Cowen, 11:55)
• Advocates for supporting young innovators, noting Estonia as a positive example; U.S. excels at enabling youth to rise, but many countries lag.
  • "Young people should be allowed to rise to positions of authority. They should be respected." (Tyler Cowen, 12:55)
  • "I'm going younger and weirder [with grants]. And I've also noticed Europe is doing pretty well on the AI Maniacs metrics." (Tyler Cowen, 14:54)

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9. False Productivity and Learning

• Not all AI use is productive—Cowen warns of the "fake work" trap.
  • "The young people are more playful with it. They take more chances... In terms of coming up with the new things that really matter, I think they're going to win." (Tyler Cowen, 16:40)
• Mastery requires active engagement, not passive following.
  • "If you're always chasing it, waiting for it to tell you what to do. You're not on top of it. It's not really the way to excel in the area." (Tyler Cowen, 26:22)

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10. Billionaires, Public Perception, and Philanthropy

• On changing hostility toward billionaires: no simple fix; public works might help but not much.
  • "Censure is the tax a man pays to the public for the privilege of being eminent." (Tyler Cowen quoting Jonathan Swift, 18:44)
  • "I'm all for today's billionaires doing more to support art, music, libraries, whatever... but I don't think it's going to make them loved." (Tyler Cowen, 19:40)

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11. AI and Religion; The Amish & the New Religious Landscape

• Cowen foresees AI creating thousands of micro-sects rather than major new religions.
  • "We're just going to see proliferation... You’ll be able to whip up your own religion... Most won't catch on, but a few will." (Tyler Cowen, 20:28)
• Amish numbers are structurally capped; admiration for their way of life but practical limits to growth.
  • "You can't have a third of America being Amish. ...But I'm glad they're there. They've done a great job." (Tyler Cowen, 22:15)

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12. Work, Entrepreneurship, and Status in the AI Age

• Entrepreneurship isn't for everyone—institutions remain important for stability and pay.
  • "Most people cannot become entrepreneurs. They're not ambitious, they should not be ambitious... Other people want to work for them." (Tyler Cowen, 23:45)
• For non-AI-maniac workers: embrace the mess, learn the tools, and be proactive about AI.
  • "Follow AI. Learn how to work with the leading models. It's a big time investment because everything changes so quickly." (Tyler Cowen, 24:26)
  • "For all this talk of the leisure dividend from AI right now, most people have to work some amount harder." (Tyler Cowen, 24:26)

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13. Gambling: The Limits of Regulation

• Gambling has become pervasive and addictive; simple bans won’t work, but norms may help.
  • "It's already too big. I don't know how we pull it back in... Banning it would not rein it in. We know that already." (Tyler Cowen, 26:46)
• Advertising and social costs parallel historic battles with tobacco, but the harms of gambling are harder to quantify in a single sound bite.
  • "I think the campaign against smoking worked because people like me hated it when someone next to them would light up..." (Tyler Cowen, 29:36)

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14. Labor Market Realities

• Despite AI, unemployment for young adults is similar to pre-LLM levels; economy resilient, but sectoral changes.
  • "The unemployment rate for 18 to 24 year olds... AI is not destroying that market. It seems we’re not going to have a recession anytime soon." (Tyler Cowen, 31:21)
• Sectoral shifts mean not all "nice" jobs are available, but the overall picture is not as dire as perceptions suggest.
  • "Big sectoral shifts going on... educated and high-class may not want [new jobs]... but in the aggregate, a lot of other people are doing better." (Tyler Cowen, 32:11)
• A coming "massive reallocation of status" thanks to AI maniacs; politics may struggle to adapt.
  • "And the AI maniacs are about to take a huge leap upwards... there'll be this massive reallocation of status." (Tyler Cowen, 32:31)

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Notable Quotes & Memorable Moments

• On banning Chinese AI:

  • "The attempt to outlaw it or ban it or use sanctions against it is going to fail miserably." (Tyler Cowen, 01:51)

• On youth and AI:

  • "This is really the province of youth. There's nowhere you can go to learn this stuff other than, say, some of the major AI centers and companies. So you've got to teach yourself. And is there the support in your environment for that? We will see." (Tyler Cowen, 14:13)

• On work in the AI era:

  • "For all this talk of the leisure dividend from AI right now, we're still in a setting where most people have to work some amount harder." (Tyler Cowen, 24:26)

• On public perception of billionaires:

  • "Censure is the tax a man pays to the public for the privilege of being eminent." (Tyler Cowen quoting Jonathan Swift, 18:44)

• On the enduring role of institutions:

  • "Large institutions pay better. It's lower risk. I don't think that feature of the world is going to change." (Tyler Cowen, 23:45)

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Important Timestamps

• 01:51 – Cowen’s argument on the inevitability and futility of banning Chinese AI
• 03:50 – Cowen’s take on European tariffs against China
• 05:21 – The local (U.S. and Virginia) benefits of data centers and chips
• 07:40 – The origins and persistence of negative economic "vibes"
• 09:39 – AI’s slower, incremental impact on GDP and real change
• 11:55 – The emergence of “AI maniacs” among global youth
• 14:54 – Cowen’s approach to AI grants; optimism about Europe
• 18:44 – Perceptions of billionaires and the limits of philanthropy
• 20:28 – The future of religion with AI as a sect-generator
• 24:26 – Advice for non-entrepreneurial workers in an AI world
• 26:46 – Gambling, its social costs, and lessons from tobacco regulation
• 31:21 – Youth unemployment, labor market resilience, and sectoral shifts

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Tone and Style

The tone is simultaneously analytical, breezy, and self-aware—balancing big-picture techno-economic questions with grounded practical advice and a touch of wry humor. Cowen’s voice is measured but unflinchingly candid, and the hosts inject energy and nuanced counterpoints.

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Bottom Line

Tyler Cowen offers a gently contrarian, highly pragmatic take on U.S.–China AI policy, tech protectionism, and the social impact of rapid AI diffusion. He champions open, adaptable systems, robust support for young innovators, and the ongoing necessity of learning and productive work—even as AI reshapes every corner of the economy. The episode is a must-listen for anyone interested in the real-world tangle of economics, policy, and technology at the dawn of the AI age.

Transcript

[Jordan Weissmann]

And without further ado, our first guest of the show is in the waiting room. We have Tyler Cowen, the American economist, to talk to us about all things. How are you doing, Tyler? Good to see you again.

[Tyler Cowen]

Hello. How are you? I don't drink coffee.

[Jordan Weissmann]

I was about to ask. I have to ask every guest.

[Kyla Scanlon]

Are you gonna start? Are you gonna start?

[Tyler Cowen]

I've only had coffee twice in my life, both times in rural Ethiopia in a coffee ceremony. And it was amazing. But I thought, this is the peak. I can't beat this.

[Jordan Weissmann]

Is that because you'd become too powerful, or do you see it as a Faustian bargain?

[Tyler Cowen]

I see people getting addicted to it, and if they can't get their morning coffee, they have headaches. Yeah, I don't want to be there.

[Jordan Weissmann]

Yeah, it does become a supply chain.

[Kyla Scanlon]

How often are you somewhere where you can't possibly get a coffee in the morning?

[Tyler Cowen]

I don't know. It can't. But you have to go out and get it or go to some effort, or you're in a hotel room and you make a crummy coffee there, and then you don't really enjoy it. It's just simpler not to have that addiction.

[Jordan Weissmann]

I think what's very interesting is that caffeine pills are incredibly economically efficient. It's like $0.01 for the equivalent of a cup of coffee if you buy them in bulk. And yet absolutely zero adoption. People love a cup of coffee, even if it's a couple bucks. It's like a simple pleasure. It's a joy. People just can't stop paying for them.

[Kyla Scanlon]

Do you do anything in the morning? Any type of ritual that you feel like you have to do to be yourself?

[Jordan Weissmann]

He's like, Celsius.

[Tyler Cowen]

No, I get high from mineral water, but if I don't have it, I'm fine. I'm not craving it.

[Jordan Weissmann]

I'm addicted. Okay. Okay. Well, let's talk about artificial intelligence. How are you thinking about the latest debate around Kimik3? Open source AI? Where should we begin the discussion? And then I'm sure we can narrow down a bunch of different ways open

[Tyler Cowen]

source and is coming and is here, whether we like it or not. Of course, a lot of it will be from China. We should allow American competitors to proceed on an even footing. But basically, the attempt to outlaw it or ban it or use sanctions against it is going to fail miserably. Like, what about multinationals? What about companies whose affiliates use open source? What about all the major US Companies that use open source? Check Chinese products right now. I hope. I plead that The Trump administration gives up on this crusade, sure. It cannot work.

[Jordan Weissmann]

Okay? So I want to push back on. It cannot be banned. Because at first blush, I agree with you. Like, it is software, it is something that can just be downloaded. You can download the weights and just have it. Anything that's replicable infinitely should just proliferate across the world very quickly. But the fact that you need an NVL 72, you need a whole server rack, you need equipment and infrastructure that acts as a point of leverage. I'm not saying that we should ban it. I'm just saying if you put me in charge of banning it, I think I would have an easier time banning open source AI than banning music distribution, for example.

[Tyler Cowen]

What will you do when it's on device? How long is that from now?

[Jordan Weissmann]

That's true.

[Tyler Cowen]

Why go down the path at all?

[Jordan Weissmann]

Yeah, yeah, yeah, yeah, yeah, yeah. That's a good point.

[Kyla Scanlon]

Yeah. What, what, what lessons are there from the automotive industry for this moment? Just, just given, you know, the use of, of tariffs and how those have worked and haven't worked. And we were talking, you know, earlier about how Europe's approached the problem you see by these all over Europe now. But at the same time, many of the manufacturers have been hurt most by just losing the Chinese market, right, or not losing it, but having declining sales there because of local alternatives.

[Tyler Cowen]

I think if Europe starts a major trade war with China, Europe will lose. This is a sad reflection on Europe, and it's a sad reflection on Europe that they can't just say, oh, we'll make fewer cars, do five or six other great things that we're readily positioned to shift into. They're not really there. But simply putting up big tariffs isn't going to help them get there. It actually will postpone it. And those tariffs over time end up applying to the inputs for your other sectors and it makes them less competitive. So Europe's really in a pickle. There's no good way out. But I don't favor the tariffs either.

[Jordan Weissmann]

How do you think about the open source models in, in terms of like the broader AI stack? Like are. Is it important that America have some position in energy data centers, chip manufacturing, networking? There's this whole stack and I've been surprised that we've been building as many data centers as we have in the United States, given all the pushback. That feels like something that could have gone to at least other Western nations. Energy rich, but that's been fairly centralized. But there's, there's clearly, it feels like there's A potential slippery slope for. Oh well, if China's handling the open source models, then maybe they should have the data centers. Maybe they should also do the power generation over there. It's dirty. We don't like having data centers here. Put them over there and then at some point it feels like you could lose leverage. But I don't know how risky that actually is.

[Tyler Cowen]

I live right next to all the data centers in Northern Virginia. It's great. They pay for half of the taxes of their county, the energy, the imb, all that. I'm completely for the chips, bring it on. But at the end of the day, people are afraid that the American models can be yanked from them.

[Jordan Weissmann]

Sure.

[Tyler Cowen]

That's partly our fault.

[Jordan Weissmann]

Yeah.

[Tyler Cowen]

And if there's open source as something in the background, people are more willing to lock into our systems to a partial extent. So the two are complements, in fact. And again, there's all these major American companies that don't typically advertise it, but they use a lot of Chinese open source right now. You're just going to pull that out of their guts?

[Jordan Weissmann]

Yeah, yeah. I mean both enterprises actually deploying these models for cost savings. And also we saw with thinking machines, they used the Chinese open source model to bootstrap a step in the process of building their latest product. And so it's a whole supply chain. Where do you think the data center pushback comes from? If you are there and have a positive experience, it's polling very poorly. Is it all fear around job displacement? Is it anything particularly on the ground, like where, where did this come from?

[Tyler Cowen]

I think right now people are just negative about many, many things. They're negative about their country, they're negative about social institutions except the military. They're very low levels of trust. They were told during COVID times during the great financial crisis, everything's okay when it was not. So you can't completely blame them. But look, as you know, this country has 50 states and if Mark Zuckerberg needs to pick up the phone and call the governor of Louisiana, thank goodness that can work here. And I think we're going to do it.

[Jordan Weissmann]

What is it about this? We're in this like counterintuitive vibe session moment Kyla Scanlon sort of written about it, coined the phrase, this idea that when, when you poll people on how are your neighbors doing economically or financially, people say they're doing fine, but I'm doing terribly or the economy will grow, the job market will be stable, but people report the consumer confidence is very low. I'm wondering if you've reflected on that more generally. And then I do have a follow up question, but what is the state of the vibe session? Is it just continual? Is it permanent? Is it getting worse?

[Tyler Cowen]

I call it negative emotional contagion. And you see it in many other areas of world history. It feeds on itself. I'm not sure we know what starts it. Maybe it is some negative events, but once it gets going, it's hard to reverse. Sometimes you need actually a war or some kind of catastrophe. I hope we do not. But if you look at wealth accumulation, the job market, stock prices, real wages, many other indices, they're doing like okay to find they're just not doing terribly.

[Jordan Weissmann]

Yeah, no, no, I completely agree. And so I had this idea. I don't know if you'll agree, but maybe the fact that we're in this vibe session and the vibes are so bad and there's so much negative emotion around the economy that if we actually were to go through a brief recession or a market correction, we might be a more resilient country. Sort of ironically because of that, because everyone would look around and be like, well, I already thought it was bad, it got a little worse, but I'm ready to reinvest. Maybe this is what I've been waiting for. Finally, I'm justified in thinking things are bad and so I can get out of this and do whatever's necessary. Because there's no longer a cognitive dissonance between what the market is doing and how I feel.

[Tyler Cowen]

One hopes, yes, it could be a bullish signal, but then again, if something terrible does happen, everyone says I told you so and maybe we get stuck in the mire.

[Jordan Weissmann]

Yeah.

[Kyla Scanlon]

Jordan, about a year ago you had a blog post, if I remember correctly. One of many. Of course that was something to the effect of like, AI is real and it's amazing, but the economy is still going to just sort of generally continue growing as it's grown. Maybe a little bit faster, hopefully. Are you seeing anything that could update your worldview on that? Because so far I feel like you've been pretty indicated, deserve a victory lap.

[Tyler Cowen]

Well, I'm seeing a lot of confirmation. There's so many people, they will say to me or say in chat groups or on Twitter, my goodness, if we had Fable 5, I would have thought the world would be totally different. And it's not. Yeah, and that's my view. But look, you go back to 1995 through 1998, we got half a percentage point of extra growth out of those advances. They to me seem Less impressive than AI. So I think over time, with some slowness, we'll get that and maybe a bit more, which is great.

[Jordan Weissmann]

Interesting. Have you seen the Odyssey?

[Tyler Cowen]

I have seen the Odyssey.

[Jordan Weissmann]

Can you give us your review?

[Tyler Cowen]

Well, look, compared to other movies, it's fantastic and it's dreamy and it's impressive. But mostly I was disappointed. I thought the dialog was lame. The casting. I don't mind the cross ethnic casting at all. I just didn't think they were the right people. Matt Damon is not Odysseus. He's just not impressive enough physically. The woman who played Calypso just seemed like a suburban housewife. I love Zendaya, but she didn't have any real role. So they screwed up many things. It didn't quite cohere. I'm very glad I saw it. Everyone should see it. It's worth the three hours. But relative to expectations, I suppose a disappointment.

[Jordan Weissmann]

Do you think it's. Do you think classicists are satisfied with it? Do you think it's good for the field?

[Tyler Cowen]

They're delighted to have any attention at all. And the different translations of the Odyssey are now on the bestseller lists. So what's their alternative? Right, they shouldn't complain too loudly.

[Kyla Scanlon]

Do you think technology is making soccer worse?

[Tyler Cowen]

I don't watch soccer, but I think technology in some ways has made basketball worse. And I wouldn't be surprised if the same were true of soccer, that it homogenizes things and everyone chases after the same targets, the same players. Teams have less individual style. But to soccer, I cannot speak fair.

[Jordan Weissmann]

What about AI maniacs? Take me through what defines an AI maniac. Why? It's important. And I have some, some pushback and follow up questions.

[Tyler Cowen]

I spoke to two teenagers this morning. One was 13, one is 17. Abu Dhabi, Finland they're AI maniacs. They spend their spare time mastering AI. They know way more than their so called teachers. They're starting companies, are building models. They realize this is the future. You're going to have a large number of companies with quite a very small number of employees but pretty high revenue. And I think AI maniacs will compete in medicine, law, business, consulting, banking, wherever it is. We let them compete. So this to me is the future. Like if you're asking, will the UK recover? I would rephrase it. Is the UK going to encourage its AI maniacs?

[Jordan Weissmann]

How can they encourage these AI maniacs? It feels like AI naturally lowers the barrier to entrepreneurship and so there's not much encouragement that's necessary. I mean, as long as the models are available and affordable for young people. They will do things with them.

[Tyler Cowen]

Young people should be allowed to rise to positions of authority. They should be respected. They shouldn't be looked down upon. They should have the chance to buy computer, get grants. It's not automatic. So you look at the United States, we do great on all these metrics. Estonia is a country that does pretty well on these metrics. A lot of parts of the world are too small c conservative and we'll see where different countries are going to fall on this spectrum. But they're not all going to do it automatically. Just like not all countries have made great rock and roll.

[Jordan Weissmann]

No.

[Tyler Cowen]

The technology is pretty straightforward.

[Jordan Weissmann]

Yeah. Yeah. Estonia is famous for major government investing in high speed bandwidth. Is that correct? Is that the rough story of Estonia?

[Tyler Cowen]

Yes.

[Jordan Weissmann]

And. But I'm interested in what that would look like for AI in America or the uk. Like it feels like many of the models or application layer companies they have sort of a free tier that gets someone potentially from zero to close to AI Maniac and then at some point they can go and find a customer to help pay for their compute bills. But is there more the government should be doing?

[Tyler Cowen]

But as you know, with venture capital there's a valley of death.

[Jordan Weissmann]

Sure.

[Tyler Cowen]

I don't know that the government should be making grants to 16 year olds, but someone should. I'm doing it. Other people should as well. So this is really the province of youth. There's nowhere you can go to learn this stuff other than say some of the major AI centers and companies. So you've got to teach yourself. And is there the support in your environment for that? We will see.

[Jordan Weissmann]

Give us an update on how you're thinking about grants. Are you going younger, broader, smaller, different partners? I mean there's been some folks who have been able to do compute grants and then they sort of cap, they sort of the dollars go further because of the implicit margin With AI Maniacs

[Tyler Cowen]

I'm going younger and weirder. And I've also noticed Europe is doing pretty well on the AI Maniacs metrics.

[Jordan Weissmann]

Okay.

[Tyler Cowen]

We'll see how it develops as the costs rise. But I've been pleasantly surprised and I'm now more optimistic about Europe than I was six months ago.

[Jordan Weissmann]

How does that like where did that come from? That feels like a come from behind story for Europe. I feel like for the longest time the brightest technologists in Europe have gone to America to start their companies. The Collisons famous example. There's many others with the exception of like the Swedes and Spotify. I suppose. But in general it feels like many people have come. Are they staying more frequently? Like what's happening?

[Tyler Cowen]

Well, these kids may yet go to America. They're too young to be going now. Maybe it's that, you know, the chat bots didn't interest the Europeans that much. They seem to like, compete with culture. Yeah. Agents are a chance to do something. Now American kids have had opportunities to do things for a long time.

[Jordan Weissmann]

Yeah.

[Tyler Cowen]

But for the European kids, this is something new.

[Jordan Weissmann]

Yeah.

[Tyler Cowen]

So I think at the margin you'll see more extra activity there and a lot of new companies from quite young people coming out of all of Europe, including Eastern Europe.

[Jordan Weissmann]

Do you think young people are better at avoiding the fake work trap that happens with some AI users? You know, the person that just builds an automated workflow to, you know, check, summarize every meeting and then they never look at the notes. And it's just endless token consumption in service of like creating the ultimate second brain that they never actually refer to. And it's, it's ultimately a lot of make work, but it feels very productive. Sort of the tool shaped, shaped objects formulation.

[Tyler Cowen]

I think the young people are more playful with it. They take more chances in the aggregate, they might even do worse. But in terms of coming up with the new things that really matter, I think they're going to win.

[Jordan Weissmann]

What do you think about the risk of the one shotting from AI? People that go so deep in it, they lose, they lose their grip on reality.

[Tyler Cowen]

It happens with everything. You know, when I was a kid, people one shot it on baseball. Can you imagine that? Or like drugs.

[Jordan Weissmann]

Yeah.

[Tyler Cowen]

AI is one of the better things to be one shotted from. I would say.

[Jordan Weissmann]

No, I was laughing about. I know some guys who've been basically one shotted by golf all day, every day. They're like reading about golf, studying golf, trying to improve their golf game. And it's the same thing as AI. Yeah.

[Kyla Scanlon]

What if a billionaire came to you and said, tyler, it seems that my type is very unpopular right now. What should we do to try to shift public opinion? Right now? There's, I think an $80 million campaign being spent to block the billionaire tax here in California. But it seems like there are other things more broadly that billionaires could do to shift public perception. But what do you think?

[Tyler Cowen]

I would say don't apologize and keep on going. I hope the billionaire tax fails. It will wreck California if it passes. It's already harmed California. Even a lot of the Democratic party politicians don't support it. I think again, there's just this negative sentiment about many, many things, including billionaires. You might say some of them deserve it fine, like with all humans. But at the end of the day, I'm reminded of the old saying from Jonathan Swift and he said, censure is the tax a man pays to the public for the privilege of being eminent. Unquote. If you succeed, people will hate you.

[Kyla Scanlon]

Okay, but you know, was it Malcolm

[Tyler Cowen]

Gladwell, Steve Levitt, Paul Krugman, whoever did well, got hated.

[Jordan Weissmann]

Oh, yeah, that's right.

[Kyla Scanlon]

At the same time, would building some massive, you know, parks and, or, you know, any, any type of public work.

[Jordan Weissmann]

Yes, I be.

[Kyla Scanlon]

Be worthwhile?

[Jordan Weissmann]

The interesting question is, is there, is there some sort of like, like a greater leverage from having like the library that you walk by versus like 1% lower levels of malaria? That's like this abstract thing that you don't see. Like there's something about building like a monument as a wealthy person as opposed to having an abstract, diffuse impact on humanity. Even if the reduction, maybe the modern

[Kyla Scanlon]

version of a park is just like owning an NFL team doesn't really feel

[Jordan Weissmann]

the same because the NFL team.

[Tyler Cowen]

Obama just built a monument. True. Does anyone love him for it? Now, I'm all for today's billionaires doing more to support art, music, libraries, whatever we all might come up with, but I don't think it's going to make them loved.

[Jordan Weissmann]

Yeah, yeah, maybe not. What about religion and AI? There were. Anthony Levandowski was working on an AI religion way before it was cool. I think 2017, he was thinking about this where it feels like we're maybe behind the curve on a true AI based religion. It feels like based on the capabilities of the models, you could have something happening. There's little pockets of people that are obsessed with certain models, but I haven't seen anything formally being built out. Where do you think that goes?

[Tyler Cowen]

I think it'll be more like sects than new religions. So you could write your own version of Hindu sacred books or your own version of Shiite Islam with your own, you know, slate of who the true imams are or should be. And we're just going to see proliferation. Like for a while in history, we had a proliferation of different versions of the LDS Church, different kinds of Mormons. Some are still around and using an agent, you'll be able to whip up your own religion. I don't know, in less than a day with rituals, sacred books, practices. Most won't catch on, but if you will, they'll have a few hundred, a few thousand adherents that may sound trivial, but if, you know, half of 1% of the population does this and some of these get some number of adherents over time, the whole religious landscape looks quite different. I think it will be more diverse and feel weirder and be less centralized in religious authorities.

[Jordan Weissmann]

Where do you think the Amish will be in 200 years? I saw someone try and use one of these AI models to project out the human population in 2200 and the prediction came back as like America will be 34% Amish. And I think it was just extrapolating linear trends of their birth rates versus everyone else. But it feels like the idea of the Amish lifestyle is actually becoming in vogue in almost popular culture with don't use screens as much, try and limit your Instagram usage, you need to log off and touch grass. All of these memes are sort of the potential gateway drug to the Amish lifestyle.

[Tyler Cowen]

I visited the Amish many times. I admire what they've done. But it's possible because the surrounding society cross subsidizes them. So you can't have a third of America being Amish. And I think they keep people in the fold because it is pretty small and tightly knit and were there say 3 or 4 million Amish, which we're very far from, the rate of leaving would be much higher. So I think it's bounded on the upside. But I'm glad they're there. They've done a great job. Their communities are quite interesting and pretty prosperous. They have a lot of kids. Good for them.

[Jordan Weissmann]

Do you agree with Jeremy Giffon that people are constantly looking for a priestly class and in recent years it's moved from the billionaire class to the online poster.

[Tyler Cowen]

I don't know, maybe online posters peaked five or ten years ago and now there's a lot more video and just the AI itself competes against the online posters. Sure, I liked his dialogue on that topic, but I don't exactly agree with what he said.

[Jordan Weissmann]

Sure, sure. I'm interested to know what level of entrepreneurship you think is reachable. Can every young person become an entrepreneur? Or are there some people who are more interested in just finding a stable job and then they need to figure out how to navigate changing jobs in the future.

[Tyler Cowen]

Most people cannot become entrepreneurs. They're not ambitious, they should not be ambitious. You could argue the numbers, but it's a small percentage and other people want to work for them. So people like working in large institutions. Large institutions pay better. It's lower risk. I don't think that feature of the world is going to change.

[Jordan Weissmann]

So advice for someone who's in an organization, they're seeing things change because of artificial intelligence. Maybe they're not set up to be an AI maniac, go out and start a company. But should they be trying to find a role that is messier in their organization?

[Tyler Cowen]

Absolutely. Follow AI. Learn how to work with the leading models. It's a big time investment because everything changes so quickly, as you know. But if you don't, you're left behind. And for all this talk of the leisure dividend from AI right now, we're still in a setting where most people have to work some amount harder. Yeah, that will change, but it's not about to change. Time to work, get to work. You do. Doesn't it exhaust you how many new and different things happen in the world of AI and you got to stay on top of them.

[Jordan Weissmann]

Yeah, yeah, it is a lot.

[Tyler Cowen]

Your AI leisure dividend. Yeah, exactly.

[Jordan Weissmann]

But at the same time, I don't know, learning, learning about AI I see as different as actually learning AI. Like there are a lot of, there are a lot of facts around. There are six AI tigers in China and like I just need to memorize what those six companies are, their histories, if I want to understand.

[Kyla Scanlon]

Yeah, you can follow it like a sport and not learn really anything at all about how, what the models are.

[Jordan Weissmann]

But that's different than using the models, which the models are so good. It feels like it's less of a learning curve and more of just the volition to just go and do it. Because even when someone says, oh well, I haven't tried the latest coding models and I'm like, oh, well, they can do a lot more. Like at the very basic, like if you wanted to ask ChatGPT for one image, you can now ask Codex for 100 images. And it can just go and do it in a for loop and it can write a little code for you and do whatever it needs to to get you your answer, that's more robust and hydrated. But also you can just ask ChatGPT how do I do that? And it will tell you how to do it. And so the learning curve, this is Joe Weisenthal opinion, but he says that like there is no learning curve because the AI is good at teaching you how to use it. But there is something there where you talk to people all the time. They're like, I haven't tried AI yet. I got to check that out.

[Tyler Cowen]

It can tell you what to do, but if you're always chasing it, waiting for it to tell you what to do. You're not on top of it. It's not really the way to excel in the area. So I think you do have to stay on top of both, like the baseball team side of it and the how do you do this side of it? Again, it's hard.

[Kyla Scanlon]

How big can gambling get?

[Tyler Cowen]

It's already too big. I don't know how we pull it back in. It's a problem now. People must enjoy it. The people who don't wreck their lives with it or it wouldn't be that addictive. But it is fairly addictive for many people and I think that we turn the clock back.

[Kyla Scanlon]

The thing that's telling is even people that lose a lot of money gambling, I've noticed that they don't hate their like bookie or the app that they use to lose money.

[Jordan Weissmann]

Yeah.

[Kyla Scanlon]

They seem to have like, you know, maybe. Maybe it's like a toxic relationship. Right.

[Tyler Cowen]

Where.

[Kyla Scanlon]

Where.

[Jordan Weissmann]

No, no. A lot of times people will hate like the player that the field goal and they will be cyberbullying the particular athlete that lost them the money and they won't be.

[Kyla Scanlon]

But not their account manager at DraftKings or whatever.

[Jordan Weissmann]

Yeah, I mean, isn't that.

[Kyla Scanlon]

But how would. What. You know, if you have a big red button that the ban, you know, sports betting or gambling, do you. Do you hit the button? Like, what would be your practical solution for reining it in?

[Tyler Cowen]

I wouldn't hit the button. Banning it would not rein it in. We know that already. You hope norms change. It's a bad thing to be one shotted by. That said, I'd like to see a cost benefit analysis all the people who enjoy it and add them up and see how that compares to the cost. No one wants to do that for obvious reasons. Just say no.

[Kyla Scanlon]

Yeah, but it's. But it. But right now, don't do it. Yeah, I guess. I guess I was watching the latest UFC event and almost every single ad is a gambling ad. Certainly reining in advertising for gambling would probably.

[Jordan Weissmann]

We have a playbook from the tobacco.

[Kyla Scanlon]

Yeah.

[Jordan Weissmann]

And I think it's in like advertising you can restrict. You can add taxes on a state and local level as well as federal taxes and you can sort of try and internalize the negative externality.

[Kyla Scanlon]

Yeah. There was that law that said you could only write off like 90% of your losses, which, which for, you know, which is really bad if you're, you know, a sports book.

[Jordan Weissmann]

The problem is, is that I don't think the. The impact of gambling, the negative impact impact has been fully Quantified. Quantified in sort of a sound bite. Yet like with cigarettes, it's like cigarettes kill millions of people every year. 50% of smokers who smoke a pack a day will die from cigarettes or a cigarette related illness. There isn't that for the gambling industry. It's just like a lot of people lose money, but you technically lose money when you go see the Odyssey. You just get the enjoyment of a three hour film. You lost money and people get the entertainment of gambling. And so that like that's the same trade. It doesn't hit as hard as like you will die if you smoke cigarettes.

[Tyler Cowen]

I think the campaign against smoking worked because people like me hated it when someone next to them would light up or on a plane or in a movie theater. If someone on their phone.

[Kyla Scanlon]

Wait, really?

[Tyler Cowen]

On the airplane? I don't care.

[Jordan Weissmann]

No, you used to. Yeah. If you're on old commercial planes, they would have a cigarette, an ashtray in the armrest.

[Tyler Cowen]

I suffered under that for years.

[Jordan Weissmann]

Yeah.

[Tyler Cowen]

You try to not sit next to the smoking section. Yeah. But again, if there's like no gambling section on the airplane, it's ridiculous.

[Jordan Weissmann]

Yeah.

[Tyler Cowen]

The guy next to me could be gambling on his phone. Yeah.

[Jordan Weissmann]

You wouldn't even know.

[Tyler Cowen]

Yeah, exactly. Let it be.

[Jordan Weissmann]

Yeah.

[Tyler Cowen]

Yeah.

[Kyla Scanlon]

That is shocking to me.

[Jordan Weissmann]

I like that you just learned that. When did, when did smoking on planes end? 80s. I feel like it was.

[Kyla Scanlon]

Yeah.

[Jordan Weissmann]

Before I was around maybe like early 90s at the very, very latest.

[Tyler Cowen]

Yeah, I recall celebrating, but I don't know.

[Jordan Weissmann]

Celebrating. Yeah. Anyway, what, what have you been reading into the jobs numbers that have been coming out? Like the overall unemployment rate seems to be holding steady. It seems like it's buoyed by healthcare. Yes.

[Kyla Scanlon]

Smoking was banned in 1988 on domestic flights lasting two hours or less.

[Jordan Weissmann]

Okay.

[Kyla Scanlon]

They're saying you can go two hours without a smoke.

[Jordan Weissmann]

Okay.

[Kyla Scanlon]

Yeah, we know you can. And then eventually they expanded it to all domestic flights in 1990.

[Jordan Weissmann]

Yeah, 1990. There you go. Jobs data, hiring. It feels like there's sort of stagnation everywhere except health care, which is sort of the messy job thesis playing out. But what else is going on in the hiring market that you've noticed from the last couple of releases?

[Tyler Cowen]

Well, the unemployment rate for 18 to 24 year olds. It's back to where it was before we had good large language models. So AI is not destroying that market. It seems we're not going to have a recession anytime soon. That's good news. Labor market has slowed down quite a bit, but that's to be expected. And some of the reports sound less impressive because we have fewer immigrants. But overall I've been pretty happy. The economy hasn't crashed, it's kept on going. Great. Yeah.

[Jordan Weissmann]

No, that makes sense. Then what are you attributing the, like the vibes around, like young people entering the workforce. Everyone says it's so bad. Is that just the really cushy tech jobs are sort of a little bit belt tightening there. They're not hiring as much and so there aren't as many of these, like really nice laptop jobs or what do you think's going on there?

[Tyler Cowen]

I think there are big sectoral shifts going on and the new jobs being created. People who think of themselves as educated and high class may not want or may not even be good at. And they complain and they're vocal and they have the ear of the media. It is a problem, I wouldn't deny that. But in the aggregate, a lot of other people are doing better.

[Jordan Weissmann]

Yeah.

[Tyler Cowen]

And the AI maniacs are about to take a huge leap upwards.

[Jordan Weissmann]

Yep.

[Tyler Cowen]

And there'll be this massive reallocation of status.

[Jordan Weissmann]

Yeah.

[Tyler Cowen]

It'll be very hard for our politics to handle that.

[Jordan Weissmann]

Yeah, I saw. Oh, that's interesting.

[Tyler Cowen]

Wow.

[Jordan Weissmann]

Wow. Yeah. I saw some stats around, like

[Tyler Cowen]

new

[Jordan Weissmann]

grad computer scientists from Stanford not getting as many job placements. And Tyler on our team was saying, like, that's a skill issue. If you're a Stanford graduate with a computer science degree, you can get a job or you can start a company, you can do something. But you might need to think a little bit differently because the track might be slightly different. But I don't know if you agree with that or not.

[Tyler Cowen]

I agree with that.

[Jordan Weissmann]

Yeah. And it also just feels like one of my latest thesis is that a lot of these CEOs who are doing like AI based layoffs, the optics are just terrible. And if they actually have a good business, they should be going on the offensive. We love that Matthew Prince hired, I think like a thousand interns or something like that. And it feels like young people who understand AI coming into an organization that has some sort of moat, some sort of durability, some business like the leverage is just going up. So you should be hiring more instead of doing layoffs if you actually understand what's at stake and how big your business can be. But if you just went through a hiring glut, maybe you do need to sort of retool.

[Tyler Cowen]

The AI companies themselves are hiring plenty, as you know. Right.

[Jordan Weissmann]

Yeah, totally.

[Kyla Scanlon]

Can you recall a point throughout history where the majority of people, let's say their sense of like self worth and identity was not tied to their employment or their job because that's a big separate issue.

[Tyler Cowen]

But obviously that's a major qualifier. Medieval.

[Jordan Weissmann]

Medieval times. I think we lost him.

[Kyla Scanlon]

His Internet went back to 1988.

[Tyler Cowen]

Growing food in a very different way from how things work now.

[Jordan Weissmann]

Yeah. Well, thank you so much for taking the time to come chat with us. It's always a pleasure to go all around the world.

[Kyla Scanlon]

It's an honor.

[Jordan Weissmann]

Have a fantastic week and a fantastic

[Tyler Cowen]

catch you all next time.

[Kyla Scanlon]

Let's work.

[Tyler Cowen]

Like I said, work harder.

[Jordan Weissmann]

Yes.

[Kyla Scanlon]

When you're. Next time you're in California, three of us, a cup of joe. We will try to. We will try to create an experience.

[Jordan Weissmann]

Third cup of coffee in history.

[Kyla Scanlon]

That would be.

[Jordan Weissmann]

Do a four hour show.

[Kyla Scanlon]

Incredible.

[Jordan Weissmann]

The wired Tyler Cowell.

[Tyler Cowen]

Get me to do it.

[Jordan Weissmann]

Let's see. We'll peer pressure.

[Kyla Scanlon]

We'll try very hard.

[Jordan Weissmann]

I don't think it'll work anyway. Thank you so much, Tyler.

[Kyla Scanlon]

Cheers.

[Jordan Weissmann]

We'll talk to you soon.

[Kyla Scanlon]

Bye.

[Jordan Weissmann]

Have a good rest of your day.