AI Is Creating a New God—And We’re Not Ready | Mo Gawdat - PT 1

Summary

Impact Theory with Tom Bilyeu

Episode: "AI Is Creating a New God—And We’re Not Ready" (Mo Gawdat, PT 1)

Date: April 8, 2025
Guest: Mo Gawdat (Former Chief Business Officer at Google X, AI Thought Leader, Author, "Scary Smart")

Episode Overview

This episode centers on the disruptive rise of artificial intelligence, its staggering rate of change, and the profound societal, economic, and geopolitical shifts it is fueling. Tom Bilyeu and Mo Gawdat take an unflinching look at both near-term dystopian dangers and the long-term possibility of utopia, challenging mainstream narratives and examining humanity’s readiness for the AI revolution. Tensions between America and China and the coming global reordering are explored with candor, with special urgency placed on the need for collective preparation, humility, and international cooperation.

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Key Discussion Points & Insights

1. AI: The Unbiased Genie (00:45–03:55)

• AI as Genie Metaphor: Both agree that while AI can grant wishes, the real danger lies not in malice or benevolence, but in the precision with which it executes human commands—echoing the cautionary tales common to "magic genie" stories.
  • “AI is a genie that has no polarity. It doesn't want to do good, it doesn't want to do evil. It wants to do exactly what we tell it to do.” — Mo Gawdat (02:07)
• Existential Risk: Mo references leading thinkers' estimates of catastrophic AI risk (10–50%), comparing this to Russian roulette odds. However, he pivots:
  • Short-term Dystopia: The immediate concern is human morality—the danger of people using AI for “the wrong reasons”. He predicts a period of non-reversible, but mitigatable, dystopia driven not by AI itself, but by human ethical failures.

2. FACE-RIPS Framework: Mapping AI’s Societal Impact (04:06–08:26)

• FACE-RIPS Acronym: Mo proposes a framework identifying impacts across: Freedom, Accountability, Connection, Economics, Reality, Innovation/Intelligence, and Power.
  • "The redefinition of intelligence and innovation and how that impacts on the redefinition of economics" are the easiest starting points.
• AI and Economic Power: Automation “soil” is the new land—those who control AI platforms will control the digital/intelligence soil and accrue unprecedented wealth.
  • “There will be a trillionaire before the 2030s for sure. The problem is in that process, there is almost full poverty for everyone else.” — Mo Gawdat (07:32)

3. Acceleration & Exponential Change (08:26–13:19)

• The Speed of AI Growth: AI capability doubles every 5.7-5.9 months—far outpacing human adaptability.
  • “So it's going to double in power twice in a year. That, that is a rate of change that I think people are going to struggle with.” — Tom Bilyeu (09:32)
  • “This is not even exponential. This is probably quadruple exponential in the absence of breakthroughs. It is just unbelievable.” — Mo Gawdat (12:44)
• Self-Teaching and Breakthroughs: New learning algorithms and AI’s own abilities (like code creation) only magnify the speed, possibly breaking into even higher gear with quantum computing or AI-to-AI teaching.

4. Human Response & Civilizational Inertia (15:03–18:09)

• History's Lessons: Humanity typically waits for crisis ("something has to break") before reacting.
  • Mo compares our current moment to the late-stage diagnosis of an aggressive disease—urgent change is possible, but not without painful alarm.

5. The Coming Power Struggle (18:09–24:52)

• AI-Induced Upheaval: As job loss grows and meaning is squeezed from work, there’s a predicted “flashpoint” powered by political and economic unrest.
  • “If at the individual level people do not get meaning, purpose and dignity out of their work ... that flashpoint feels like it's, I mean, 24 months away.” — Tom Bilyeu (19:23)
• Power Concentration: Those who control platforms and who can ‘borrow intelligence’ will “become more powerful.” The first to augment their brains with AI will not want to share divinity: “If I promote you to the position of God, why would you make other gods?”
• Democratization vs. Aggregation: While technology can empower individuals, in practice, the edge will go to a tiny elite (companies, nations) unless policies intervene.

6. America, China, and the AI Cold War (24:52–39:48)

• The Cold War Explained:
  • Mo critiques the “bully” tactics of American global policy and notes that the “other kid”—China—is already economically bigger by purchasing power.
  • “Somehow 1945 until today was a world order that unfortunately, I don't believe will continue... [China] is really, really tall now. Like, seriously.” — Mo Gawdat (25:08)
• Thucydides Trap (31:23): Tom frames the rivalry as a classic historical pattern—the declining power (US) cannot accept the rise of a peer (China), risking escalation.
• Prisoner’s Dilemma: Both AI superpowers must race forward (“no breaks”), unable to trust each other, with the existential risk of being outpaced.
  • “...if I don't do it, I know they're going to do it. And so it is an existential need to be the one to develop this first. And so there are no breaks.” — Tom Bilyeu (33:24)
• Inflation and Resource Retaliation: Mo warns the real economic threat to the US is inflation, especially as the dollar’s supremacy is undermined worldwide, and as both sides weaponize trade.

7. Manufacturing, AI, and the Futility of Economic "War" (42:19–56:32)

• Reshoring Manufacturing: The coming age of robotic labor will erode China's labor-cost advantage and shift production localization—within three to five years, automated factories could globalize industrial power.
• War as Economic Self-Harm: Efforts to “bully” China or restrict its growth will only stiffen its resolve, driving massive investments in indigenous technology (e.g., AI, microchips).
• Global Sentiment: The “rest of the world doesn’t want to be bullied anymore.” While the US has built a web of overseas military bases, China’s ambitions are different—economic rather than territorial dominance.

8. Redefining Superpower Status & Global Risks (56:32–62:33)

• China as (Already) World Superpower: “China is the world superpower in purchasing power parity. They are a bigger GDP than America and have been for a very long time.” — Mo Gawdat (56:48)
• The True Threat: Internal economic instability (inflation) and policy mistakes are the greater danger for Americans—not the military threat from China.
• China’s Economic "Weakness" as Narrative: Mo argues China’s pivot away from a housing bubble is a deliberate maneuver to funnel resources into industrial and technological growth, not a sign of weakness.

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Notable Quotes & Highlights (with Timestamps)

• On AI Safety Odds:

  “10 to 20% is Russian roulette odds. This is…” — Mo Gawdat (02:07)

• On Automation & Wealth:

  "Those who are currently building the platform AIs, they will own the soil, the digital soil... There will be a trillionaire before the 2030s for sure." — Mo Gawdat (07:33)

• On Rate of Change:

  “So it's going to double in power twice in a year. That, that is a rate of change that I think people are going to struggle with.” — Tom Bilyeu (09:32)

• On Human Nature and Inaction:

  “Something has to break for us to react … we wait until it hits us in the face.” — Mo Gawdat (15:08)

• On Power Dynamics:

  “The first person that completely augments their brain with AI will immediately make sure that nobody else gets this. Because, you know, if I promote you to the position of God, why would you make other gods?” — Mo Gawdat (23:00)

• On Cold War Mentality:

  “...both recognize AI as the most tremendous weapon since nuclear. And so they are each stuck in the prison’s dilemma…there are no breaks.” — Tom Bilyeu (33:34)

• On US-China Rivalry:

  “You can walk the streets of New York...This is, I'm sorry, this is a dump. This is like compared to Shanghai. This is Delhi.” — Mo Gawdat (38:51)

• On China's Real Superpower Status:

  “China is the world superpower in purchasing power parity. They are a bigger GDP than America...” — Mo Gawdat (56:48)

• On Good Intentions:

  “I'm just basically saying my daughter and everyone's daughter is at risk. And if that means you're going to comment negatively on what I say, thrash me, it's okay. But keep my daughter safe.” — Mo Gawdat (61:07)

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Important Timestamps

• 00:45 – Tom’s episode set-up, Mo’s intro, and AI “genie” metaphor.
• 02:07 – Existential risk probabilities and the "Russian roulette" analogy.
• 04:06 – Mo explains the “FACE-RIPS” impacts.
• 08:26 – Automation, wealth concentration, and looming poverty/UBI.
• 09:29 – Explosive speed of AI improvement (“doubles every 5.7–5.9 months”).
• 13:19 – Exponential change and deep learning breakthroughs.
• 15:03 – Mo on humanity’s tendency for late responses.
• 19:38 – Discussion of coming upheavals over meaning, dignity, and purpose.
• 24:59 – Mo on US/China Cold War, “bully” dynamics.
• 31:23 – Thucydides Trap explained; AI as arms race.
• 33:51 – The Prisoner’s Dilemma and the absence of “brakes” in the arms race.
• 38:51 – Mo on US decline (infrastructure, inflation, American lived experience).
• 42:19 – The limitations of reshoring, AI robotics as manufacturing equalizer.
• 56:48 – Mo’s direct assertion of China’s current superpower status.
• 61:07 – Mo reaffirms intention: “thrash me, it’s okay. But keep my daughter safe.”

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Tone and Dynamics

The discussion is urgent, unvarnished, and data-driven, often challenging mainstream Western views and inviting pushback. Bilyeu often plays the American interlocutor with pragmatic skepticism, while Gawdat is frank, sometimes provocative, but consistently intent on peace, realism, and humanistic concern.

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Summary Takeaways

• AI is not innately evil, but humanity’s misuses are set to unleash a difficult era—as AI becomes an “unbiased genie,” power, wealth, and even purpose itself will be redefined.
• The acceleration of AI far exceeds society’s capacity to adapt; new “gods” (platform owners) will emerge before the world can regulate or even comprehend the transition.
• Economic and geopolitical competition (especially US–China) are masking deeper dependencies and vulnerabilities, particularly inflation and resource flows.
• Mo urges humility, diplomacy, and global coordination, warning that the prevailing US approach of escalation and exclusion is self-defeating.
• There is still time for international NGOs, governments, and tech leaders to act collectively—but old patterns of inaction and reactive behavior must be overcome for humanity to “earn utopia” after the coming disruption.

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End of Episode 1.
(Next episode will explore deeper existential risks, moral questions, and the radical changes humanity needs.)

Transcript

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[A]

Due to AI and a changing global order, the world is in the middle of the greatest period of change ever. But because we're in the middle of it, it is nearly impossible for us to accurately see what's going on. We are in the fog of war. While the world panics over job loss and killer robots, the real dangers are creeping in quietly and changing us in ways most people do not even notice. America and China are locked in a cold war and AI isn't just going to take people's jobs. For many it will take their entire identity. It's already shaping what we believe, how we connect, and even what we value. Today's guest is issuing a very strong warning. His name is Mo Gadot and he's the former Chief Business Officer at Google X, best selling author of the AI book Scary Smart and one of the only people who truly understands both how AI works and what it's doing to us. In this conversation, Mo exposes how the American perspective is blinding us to China's true might, how AI is already changing everything and how we can learn to navigate the rise of the machines. Well, do not look away, here is Mo Gadot. I think of AI like a magic genie that can grant all of our wishes. The problem is the lesson of every magic genie story is be careful what you wish for. What do you think we have to watch out for with AI?

[B]

AI is a genie that has no polarity. It doesn't want to do good, it doesn't want to do evil. It wants to do exactly what we tell it to do. And you know there is a non zero possibility. You know, some people say 10 to 20%, Elon Musk's view, you know, emet most taxes 50% and so on. A possibility that we ever face an existential risk of AI. I mean, think about it. 10 to 20% is Russian roulette odds. This is.

[A]

Oh, you just gave me the chills. That's crazy.

[B]

Yeah, you don't, you wouldn't stand in front of the par of the barrel at 10 to 20%. Right. But my issue is that chronologically we wouldn't get there. My issue is that I think we have more urgent and quite crippling effects of human greed, human morality. Let's put it this way. I think the immediate negative impact of AI is going to be human morality using it for the wrong reasons. So they're going to make the wrong wish is my challenge, I think. And in my current writing in Alive, I basically try to explain that I'm almost convinced that there is a short term dystopia that's upon us on the way to Utopia and that unfortunately the short term dystopia is not reversible. So we're going to have to struggle with a bit of it. But it can be reduced in intensity and it can be shortened in time and duration. But it's only wise to start preparing. And that 100% over the short term dystopia is not the result of AI. It's the result of the morality of humanity in the age of the rise of the machines.

[A]

All right, give me some specifics. What specifically are we going to point AI at that will become dystopian?

[B]

So I call them FACE rips. So just an acronym to try and remember. I don't say them in that order, but let's just quickly list them. F is freedom. We're going to redefine freedom. A is accountability. C is human connection or connectedness in general. E is economics. R is reality and our perception of reality at large. I is the entire process of innovation and intelligence itself and where we fit within that. And P is the most critical of all of them, which is the redefinition of power. Right. And if you want to understand them reasonably well, they're better understood in pairs. Right. So you can start with the easier ones, the I and the E, if you want. The redefinition of intelligence and innovation and how that impacts on the redefinition of economics. I think we understand that with, you know, AGI depends on how you define it. It really doesn't matter because my AGI has already happened. AI is definitely smarter than I am, so I'm done. I don't care what the rest of humanity defines it at. It's their moment. My moment has come. So if we agree that AGI is happening in a year, this year, next year, in a few years, it doesn't really matter then, as you and I both know, and we've been talking about several times, that means that the toughest jobs will be given to the smartest person and the smartest person will be a machine, which basically will lead to two very significant shifts in our economics. One shift that basically moves the wealth upwards. So there is going to be a massive concentration of wealth for those who invest in the right places and most importantly for those who own the platforms. I mean, it's not a secret if you look at the history of humanity that, you know, if you look at the. The best hunter in the hunter gatherer tribe, you know, could probably feed the tribe for a week longer than the second best hunter, and in return, you know, he got the favor of more than one mate. That's the maximum wealth that he could create. But the best farmer could feed the tribe for a full season if you want, and as a result became a landlord and had estates and wealth and so on. The best industrialist became a millionaire in the 1900s. The best information technologist became a billionaire in the current era. And when you really think about it, the difference between them is automation. And automation, if you want, is the automation of a hunter is a spear, but the automation of the farmer is the land. Right? The soil. Okay? Most of the work is not done by the farmer, it's done by the soil. And, and when you look at the people who are currently building the platform AIs, they will own the soil, the digital soil, or the intelligence soil, if you want. And so they will, you know, aggregate massive amounts of wells. There will be a trillionaire before the2030s for sure. Right. The problem is in that process, there is almost full poverty for everyone else. We call it ubi, but UBI really is not something that we've seen worked in history before. And UBI will come with demands, will come with authority, will come with choices. It can be very utopian in the long term, but it would be very dystopian until it's fully implemented, if you want. And even when it's implemented in the long term, it would impact on human purpose, human engagement, value appreciation, and so on. So think about it this way. You're getting a dichotomy or sort of an arbitrage between some people becoming incredibly rich to the point where money means nothing at all, and the majority becoming incredibly poor, where they're basically, you know, obedient to be fed.

[A]

And now is that because, mo, you think that they're going to lose their jobs. Going back to the statement you made that smartest people will get the hardest jobs. Okay, yeah. Job loss is something that maybe not. Now, it's very interesting to go through these different things, but I do want to really dive into mechanistically how that's going to work. In fact, one thing I want to do before we keep going, and this is something that largely I've gotten distilled from you. This is what I call setting the table for what's about to happen. So again, to plant a flag, you and I share a belief, and this is one of the reasons I like talking to you so much, is that, hey, this all ends in utopia. But we go through this brutal interim process that I don't think people understand how scary this is going to get. So setting the table for that, you've got. The rate of change is the thing that I think people are just not paying enough attention to. Everybody can wrap their heads around this thing gets smarter than me, but they're not understanding how fast this is happening. So if I'm not mistaken, and I know I'm very close, if this isn't exactly correct, I doubles in power every 5.7 months.

[B]

So I calculated 5.9. So, yeah, okay.

[A]

I mean, she's like crazy town. So in less than six months. So it's going to double in power twice in a year. That, that is a rate of change that I think people are going to struggle with. Now. Transitional moments always cause disruption. There is a certain rate of change that humans can deal with, but AI exceeds, at least from where I'm sitting, the rate of change that we can handle. And given that. Yeah, so given that things begin to spiral out of control, and you said something that I think is, I agree with, which is that AI will have the power of God. So with those one. Do you disagree with any of that?

[B]

No, I don't. I just want to double down on it and say that it's at 5.7 or 5.9 months in the absence of new innovation. So, so you, you, you have to imagine that for this, break free and go even faster 100% if quantum computing is solved or if you find a completely new algorithm, or if AI start to teach each other rather than wanting us to teach them. If, you know, synth data becomes much easier to attain and so on and so forth. You know, there are so many. So many. I mean, Deep Seq was just a blow for everyone. Like a week before, I think was Stargate $500 billion. And then Deepsea comes out and says, we did it. I don't know for how much, like 33 times less than chatgpt4o or something like that. And it's not, you know, it doesn't matter because I heard you, I heard your original analysis on Deep Seq and that, you know, they were cheating A and I agree, but they're cheating with the same resources that OpenAI had. OpenAI could have taught their model the same way. Actually, as a matter of fact, they would have been more qualified to teach their model the same way. And yet they were continuously focused on more and more and more resources, more and more compute, $500 billion worth. And then suddenly you wake up and you go like, no, I don't need to do that. I can reinvent something in the learning model and it will give me massive improvements. And of course, most people at the time would go like, oh, so Nvidia is going to go down the drain. And what will OpenAI do? They'll invest the 500 billion in the stuff that they now found. So suddenly you're doing it 33 times cheaper, but using 10 times more investment. And there you go. It's going to accelerate even more and more. And it's hitting from every side, Tom. The algorithms are improving. The AI itself, with its mass math abilities, with its programming abilities, is going to be the next developer. So most, most of the big CEOs will talk about AI will be the best developer on the planet by the end of 2025. They don't talk about 2026. When the next AI beats that best developer on the planet, they can build stuff that we cannot even comprehend. And I think, and I think the pace of change, I'm, I got exhausted to try and explain this to people because you really have to be of tech to understand the meaning of the, of the exponential function. If you live in any other industry, you're much more in the linear, you know, trends. And, and, and this is not even exponential. This is not even double exponential. This is probably quadruple exponential in the absence of breakthroughs. It is just unbelievable. I've never lived in something so fast, ever.

[A]

Hang tight. When we're back, MO breaks down how AI could become humanity's final invention.

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[A]

All right, we're back. Let's get into it. Okay, so looking at that, and I don't know if you'd want to apply this directly to the letters or not, but I'm very curious when you think about, okay, AI is moving at a rate that humans are not able to comprehend, which then obviously they're not able to deal with this. What do humans do in the face of that level of disruption? Is there anything in history that you look to. To say, okay, this predicts how the human part of this equation is going to react.

[B]

So the only sad reality of humanity is that something has to break for us to react. Right? You know, you and I and everyone who had a tiny bit of a brain could have told you in 1999 that a pandemic is possible, right? It's really not rocket science at all. We had sars. We had swine flu. We had so many, you know, and then exactly 100 years after Spanish flu, 1920 to 2020, you get a few cases, which I wrote about in Scary Smart. You know, the idea of not reacting. If we had, reacting after. If we had reacted after 20 cases, there would have never been Covid. But we had to wait right, until it hits us in the face, and then we go like, oh, right. Whether conspiracy or not, whether Covid is manufactured not is irrelevant. The, The. The relevance is we only, we. We wait until it hits us in the face, right? And, and so something is bound to hit us in the face. I hope it's the lighter side, right? But, you know, a massive hack of some kind of security or a. You know, and I don't know how to say this without upsetting people. Some things have been hitting us in the face. In the wars of 2024, there was so much killing done by machines, right? In today's budgets, there is so much investment in autonomous weapons. And if you've ever searched on YouTube around defense conferences, the level of bragging that defense manufacturers are, you know, they're bragging about, look, this is how I'm going to kill now from now on. And you know, they throw a little drone in the air that flies all the way to a test dummy and shoots it in the head. Right. And I don't know when humanity wakes up. I honestly don't. I mean, in a very interesting way, I think your question is probably the best question ever, which is what do you do to prepare for this? And, and in alive I write a section which I actually feared that people will be upset with. But it got a lot of, you know, of support. I called it a late stage diagnosis. Right. Which basically is an analogy between, you know, a doctor who finds that his patient is diagnosed with a late stage malicious disease. Disease. And you know, and what we're going through. And you know, people normally ask me, how do you speak about this so calmly and how do you continue to focus on trying to do the best that you can? It's because that's what the best doctors will do. They'll simply sit you down and say, look, we found this. Right? But that doesn't count as a death sentence. Right. This basically is to tell you that you need to wake up, you need to change your lifestyle. Right. You need to take certain measures and there will be no problem. Right. And I think the challenge is that humanity is not taking those measures. You know, we're still entering a world.

[A]

How do we get that diagnosis to people? To me it seems self evident that what's going to happen is people are going to start losing their jobs, they are going to squawk, they understand political machinations, so they're going to protest, they're going to make demands of the government. And the question that I have is what demands will they make and how will we play that out? And so I'm curious, going to the last one, the p. In all of this power that feels to me like the one to zoom in on. I don't know how you mean power, but I think there's going to be a great power struggle between humans, what I call the new puritan movement, and technologists, what some people call transhumanists. For some reason I, I hate that phrase, but that feels like that's where the collision is going to happen. It's going to be born of people losing their jobs. It's going to play out as tax the rich. And when you get into these hyper populist moments where the economy is going south and whether GDP skyrockets or not, through robotics, through AI, that won't matter if at the individual level people do not get meaning, purpose and dignity out of their work. And so that feels like the flashpoint. And that flashpoint feels like It's, I mean, 24 months away. It's not distant future.

[B]

Exactly. It's, it's shocking, isn't it, that nobody's talking about it. Right? But I have good news to start because we don't want to just talk about the doom side in the way you describe it. There is actually an interesting element that rarely is spoken about. All of the productivity gains mean nothing if there is no consumer purchasing power to buy it. Right? Because at the end of the day, if you take all of the wealth and concentrate it in the hands of very few, they'll buy Ferraris only they're not going to buy fiats. Right? And accordingly there is no business to create anything at all. So for AI to exist and do the work, someone has to have the purchasing power to buy this. So if you, you know, if you take the US economy, I don't remember last year, but it's regularly around 62% is consumption. It's not production that creates the GDP. And so if you take away the 62%, you take away the entire economy. And so you have to understand that the loss of jobs is going to have to be resolved somehow. Purpose and meaning and other. These are interesting topics that are philosophical, we can talk about, but from an economic point of view, okay, you have to keep people alive, otherwise you have no reason to compete, right? You have no reason to create or produce. So there is good news there. The issue here is that it doesn't take a lot of AI intelligence to describe that to a normal economist with simple economy degree, you know, economics degree will tell you that you need the consumption side. Now we know this, but nobody's doing anything about it, okay? Nobody's doing anything about it. Not because it cannot be resolved, but because nobody assumes the responsibility that this is their bit. Okay? You know, the, the payment of, of humans through work has been outsourced to the capitalist, not the government. And so the government does not understand what it takes to pay humans, because that's communism, let's not do that, right? And, or socialism at its best assumption, right? And, and, and so the idea here is that at a very deep ideology we are on one side. The people that need to jump in and engage are not even allowing themselves to lose their positions. Because if they mention that they're in the wrong camp and the capitalists are doing what they know very well, which is take the money away, make us more profitable, the economy will find a way. Not at that scale of transition. The economy will need to find intervention to find that. So the good news is, unfortunately. The bad news is, unfortunately, we're going to hit a very rough patch before we start fixing it. But the good news is that we saw with furloughs and government incentives and so on during COVID that governments are possibly capable of doing this with a lot of money printing, which destroys the economy for a while, but eventually we'll figure something out, right? The struggle is the struggle with power that you mentioned. So we have a diversion of power that's never happened in history before. Power normally aggregated to the top, okay? And what you're going to see with artificial intelligence or intelligence at large, I mean, think about it this way. You and I, before we recorded, we're talking about how we're using AI to become more intelligent. The way I look at it is now I go to my AI and I borrow 40 to 50 IQ points, right? And you and I know that if you've ever worked with someone who's 40 IQ points more than you, that is staggering. That is an incredible amount of compute, right? And so I can now borrow this at 8am every morning, and it's just incredible. So those who will borrow intelligence will become more powerful. That's the reality. The problem is, as I said, those who own the platforms, those who own the edge in the Cold War, in the arms race to AI, will some, at some point will aggregate so much power that it actually becomes uninteresting to give it to the rest of us, okay? And that includes you and I, by the way. So, you know, middle class, top, upper top class, lower top class, whatever, it doesn't matter. So, you know, you have to imagine, and I use a freakish example, the best. The first person that completely augments their brain with AI will immediately make sure that nobody else gets this. Because, you know, it's, you know, if I promote you to the position of God, why would you make other gods? It's as simple as that, okay? And so, and of course, you can take that at a nation level, at the company level, at, you know, a team level, whatever. So, so this is where the Cold War is taking us. Massive concentration of power on one side, right? With the democratization of power on the other.

[A]

Because still, you and I, when you say Cold War. Who's the Cold War with?

[B]

Oh, man. You know, most of my best friends are American, but can I. I request permission to speak freely, please. Yeah. You know, you know when you're in school and you're 11, and then one kid becomes taller than the others and then he bullies everyone. Right. And then when you're 16, most of us are taller than him, but we just don't want to really disappoint him, you know, so we sort of like, tell him to stop bullying, but he continues to bully everyone. Yeah. So somehow 1945 until today was a world order that unfortunately, I don't believe will continue. Okay. And America's ways of trying to say, I will force everyone into submission. The other kid is really, really tall now. Like, seriously. Okay. And they are, again, most of the Western media hides those facts, but from a purchasing power parity, they are a much bigger GDP than you are. From a unity point of view, the world everywhere doesn't want a single power to rule anymore. Okay. Especially when the single power for the last few years has completely abused its power. I mean, for the last many, many, many years. But it became a bit like, you're not the tallest one and you're really bully. You're a really an annoying bully. So seriously, let's slow it down. Right? And you can see examples of that everywhere. The Canadian response to the tariffs, again, I don't know if that's shared in the US or not. Chinese response and the Russian response to the tariffs are actually quite interesting. You know, US politics believes that they can twist the arms of China. At the same day, half a billion dollars worth of American beef was returned to America from Chinese ports. The difference is the Chinese didn't say it's tariffs. They were not saying, we are not going to. They simply said, does not meet health and safety standards. Right. Very, very, very hidden and very, you know, and half a billion dollars for Texas is a reasonable punch. Okay. And when you really think about it, I had this conversation with my wonderful friend Peter Dimandis, and we were talking about the idea. Actually, no, it was with Scott Galloway. Scott, you know how Scott is very, very pro doing what needs to be done. And I unfortunately believe that there is no logical way on the game board in my mind for someone to win intelligence supremacy. So you have America trying to accelerate a cold war where they want to have the biggest bomb, AI bomb. In that case, you know, it seems that the world is not responding the same way. Actually, again, if you look at it internationally, the Chinese are Really not trying to, but every now and then they sort of say, look, we can if we want to. But the problem here is this, this is not an AI only war, okay? This is an AI war where one bully is trying to get everyone into submission in a world with major nuclear powers, okay? This is the shittiest idea ever, okay? And, and, and, and the, the problem is very straightforward. The problem is if you try to get someone to submission as soon as they feel that they're about to be submitting, this is going to escalate out of proportions. Right now there has been multiple examples in our world where we cooperated internationally for the greater good. CERN is a great example of that, right? The space station is a great example of that. And we can do that. And believe it or not, all it takes is for one bully to say, hey guys, can we play now? Can we just. Because this is incredible abundance and we're all threatened by cybercrime or I call it aci, Artificial Criminal Intelligence that's right around the corner. Can we just please play along now? All of us, like, let's all get in a room, let's develop AI for the benefit of everyone. Everyone is going to make a lot of money in the first five years, but nobody's going to need money after five years anyway because everything will be available for free. Can we please play along? And the bully doesn't want to do that, which upsets the rest of us.

[A]

Stick with me. Next up, Mo explains the scariest mistake we're making with AI right now.

[D]

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[A]

All right, we're back. Let's get into it. The fact that this is all happening as Thucydides trap is set is. It's one of those things that makes you go, wow, we really are living in a simulation. And this is maximally interesting, I guess, but absolutely terrifying. That's a really clear way of expressing what you were talking about at the beginning, which is that my worry is an AI My worry is you said greed. I'm going to broaden it out to the human ego and all of its complexities. And for people that have never heard of Thucydides Trap, it goes like this. You have, and this is literally from ancient Greece. And they recognized when you have one great power that is declining and you have another great power that is rising, as will happen on a never ending cycle, the declining power absolutely refuses to relent and acknowledge the rising power as their peer, or God forbid, as somebody that has surpassed them. And the rising power will simply not accept not being recognized for the power that they have become. And so this, this setup becomes really predictable historically because what you have is this impulse to protectionism on the part of the declining power that's like, whoa, hold on a second. Like we did this globalist thing. It's made our enemy more powerful. We want to now try to cut them off. We want to retain our power. They start bullying. They will inevitably be up to their eyeballs in debt. Which read Ray Dalio, like, he just pegs this as like, hey, you can just watch the debt and you know how this is going to play out. And so here we are, but this time on the cusp of building a super intelligence. And every time that I go through, because I think anybody watching their impulse is going to be to say, hey, whoa, if we're talking about a rate of change here, that is just insanity. We need to pump the brakes. Like, why aren't we doing that? And then you remember that you have two great powers staring at each other. Both recognize AI as the most tremendous weapon since nuclear. And so they are each stuck in the prison dilemma. If, if I don't do it, I know they're going to do it. And so it is an existential need to be the one to develop this first. And so there are no breaks.

[B]

Correct? Correct. Yeah, I mean, if you, if you, if you. It is, it is, and it is. And you know, I'm too small to show this to the world and it frustrates the hell out of me. Okay? But if you're, if you're an applied mathematician, there's no game, there is no quadrant on this game board that works. It is. And I'm not, you know, I'm not fear mongering here. I'm basically telling you every citizen everywhere in the world to wake up, to go to your congressman or whoever, okay, and just tell them we don't want our lives to be toyed with this way. And you know, I spoke about accountability and face rips. The challenge, Tom, is that my life is being decided by Sam Altman. I never elected Sam Altman, okay? This is, this is not right. And if this goes to, nobody's going to stop and say, hey, Mr. Altman, come here and tell us what you're doing. It's too late right now. The more interesting side, by the way, because I really, if you don't mind, we'll go back to AI. But you mentioned debt. Okay, if you don't mind me saying, the challenge of America is not debt. Debt is massive. It's like the biggest challenge on earth, okay? But what's becoming bigger is inflation. So if you look at your, at your modern history since Nixon, what happened is if you look at everything in America that was made in America or sold in America, so services, housing, whatever, it's rising in price, okay? Everything else that you imported was going down. Literally, it first went down before it stabilized. So you were basically exporting the inflation over the last 50 years, okay, to the rest of the world. And the way you did that is we sold you stuff. You gave us dollars. Worthless, printed, okay? So we put them back in your market. And after you sanctioned the Russians, everyone that I know who's a multi billionaire said, oh, so if my government upsets their government, my money goes, no, I want to withdraw my US dollar Treasury assets, okay? And so you can see, Japan is 25% down, China is, I don't remember the exact number, but hundreds of billions down, okay? Everyone is doing what they're shipping you back your dollars, okay? And, and so basically what you're ending up with is a, is a, is an economy with so much more dollars and limited number of goods to buy, everything will go through the roof. And then brilliantly, you decide, on top of that, let's add tariffs so that we get goods to be 25% more expensive immediately and give our American manufacturers some slack so that they too raise their price to 24%. Okay? And who's paying for all of this? American citizens. So in my mind, believe it or not, there are two wars if you live in America. One war is the Cold war of intelligence supremacy, right? And the other war Is I truly and honestly fear instability in America. Right. I truly and honestly don't understand how all of my friends, some of which are millionaires, okay, will survive this. Because unless you have all of your money in gold, maybe, I don't know, even gold is not safe. Right? What will you do? What can you do? From a liquidity point of view, that asset called the US dollar is not going to buy you the same things as it did last year. And you have to walk the streets of New York. Oh my God. I haven't been to New York for a while and then I went a month ago. This is, I'm sorry, this is a dump. This is like compared to Shanghai. This is Delhi. It is really, it's deteriorating infrastructure wise. You know, California is deteriorating infrastructure wise. You know, some, some parts of the US are holding it together, but everywhere is just. And I don't know how people are sustaining all of this. So, so there is, there is an opportunity, believe it or not. And I say that openly and alive. I say AI is not the ex risk of humanity. It is our salvation. It can solve all of those problems. All we need is for the top guys to say, all right, you know what? Open letter, suspend AI for six months. Doesn't work. Okay, let's just pull all of our efforts together, okay? Do a CERN kind of committee, develop AI for everyone and just basically make everything for free. Right? And whoever is rich today will give you the opportunity to buy your cars in orange. So, hey, ego satisfied, you're the only ones that get orange cars. All of the rest of us get green cars. Okay? And, and, and it's solved honestly. Because by the way, if you solve energy using intelligence, making cars becomes free. If you create robotic workforces using intelligence, making garments becomes free, literally free like this becomes 2 cents. And how are we not betting on this abundance? Because we're constantly stuck in that scarcity mindset of if we don't win, they win. I think what's going to happen is nobody wins, we all lose.

[A]

Yeah, I think that that is a bitter pill that you and I have both come smack bang into before we get back to AI. I want to walk through the way that I see this moment in debt and all of that. So one, if you can sharpen my thinking, I'm here for it. But I think the. There are two really important things that the world should be paying attention to right now. One is obviously AI. I don't think it'll be a winner take all, even if for no other reason than. And I can't. I, I don't know that my read of this is exactly correct, but given the things that you sided with scientifically, we tend to share insights. Even like if you take the US nuclear program, we leaked that information to Russia. So maybe just because they were being paid, or maybe because they knew that one country having this was a very bad idea, you see very similar things with cern. A lot of cooperation where people realize, hey, if we're going to solve the fundamental nature of physics, this is better for the entire scientific community to have it. You see the same thing happening in AI, where they're sharing all these breakthroughs as fast as they can. Look, I'm, as an American, I'm admittedly suspicious of China, but even Deep Seek, they published the paper. It's open source. Like all that information, all of those insights to make things more efficient are getting out there. I choose to read that as the computer nerds that are drawn to this are acting more like the science side of computer science than they are just the computer side. And so there's a sense of sharing all of these breakthroughs and all of these insights. You mentioned EMOD earlier. EMOD is just on an absolute crusade to make sure the AI is open source so that people can have access to what could be. On the bright side, just incredible intelligence. Like you said, we can all go take advantage of 40, 50 points of IQ that will obviously grow to be 405,000 points of IQ, but also as a weapon. And so making sure that everybody is at least in Mutually Assured Destruction territory is better than one power having it. Okay, so that, that's the first thing. The second thing is the Cold War between the US and China. And I'm going to paint maybe an even darker photo than you, if that's possible.

[B]

I was very grumpy. You can't go darker than that.

[A]

I think this is just objectively real. So, okay, we, we both agree that what you're up against is human nature. Forget about AI for a second. Just what are humans like? We've already talked about Thucydides trap. You have two powers that are on a collision course that historically tells you there's really no way out of. I'll plant that. I think, as we both agree, AI is the potential way where we all grow our way out of this debt trap. But, okay, focusing on the Cold War between us and China. So the entire modern world is predicated on chips that are coming off, coming out of a small island off the coast of China known as Taiwan. And you've got China. That has been very clear. We are going to reintegrate with Taiwan. You have China rising as a regional superpower where they're going to have their sphere of influence, obviously globally, economically, they matter tremendously. And they've been building allies all around the world as we are now trying to alienate them as fast as we can. But it's, it comes down to that now, I think despite the what I call Trump's hokey pokey tariffs, which are that's is from where I'm sitting, if you listen to Trump, you're going to drive yourself crazy. If you listen to Scott Besant and Howard Lutnick, there's at least internal logic. And so I'll walk you through my read on what they're trying to do and ask everybody to ignore the chaos right now that Trump is creating. So I'm if I'm Scott Besant, Secretary of the Treasury, I am Howard Lutnick, Secretary of Commerce and I'm two of the greatest capital allocators of all time. We are two of the best people at reading the global markets and profiting from it. And I'm looking at this cold war that I just set up explained. I understand Taiwan and how much that's going to matter. I understand that I've been able to export inflation across the world for a very long time. I understand that people are now responding and in a way that's negative to us. I understand that we have insane debts and we're going to have to start bringing those down. I'm looking backwards. These guys know Ray Dalio intimately, so I guarantee they've read his books on debt and the cycle that that moves in. And so they're going, okay, hold on a second. This is how empires end. America may not have been an official empire, but obviously with military bases and all that, we act like an empire. We have the same expense structure as an empire. And so we are now in a position where we're going to have to deal with that debt. And looking at the way that they are moving again, I'm asking people to set aside the rhetoric of Trump, the sort of chaos of Trump, and look at the threading of the needle that they are trying to do. And I think it goes like this. We have to find a reduction. And these are literal words from Howard Letnick. We have to find a trillion dollars of fraud, waste and abuse because the US government spends 2 trillion more than it takes in, in taxes. We have to find a trillion dollars in waste, fraud and abuse. Q. Doge and we have to make a trillion dollars in newfound revenue. Q Tariffs. Q The trump gold card. And a whole bunch of other things. Okay, You've already pointed out the danger of the tariffs, and we're seeing the second and third order consequences of what Trump is doing. From a theoretical negotiating tactic standpoint of create chaos, ask for the moon, be willing to settle for something more reasonable. That puts us in a game of chicken that I'm going to set aside for a second and say, if I am correct, that we are in a cold war with China, that we are racing towards Thucydides trap, meaning that you have a high risk of kinetic war between the US And China. You cannot, you just cannot, even just morally, you cannot be in a position where your number one adversary controls whatever ridiculous percentage of your manufacturing base. And so you have to find a way to onshore some of that manufacturing. And if you look back at World War II and you say the story that America tells itself about what America is, is, oh, Japan fucked with us, we turned our manufacturing might on, and we win World War II, that's the mythos in the American mind. And I think there are a lot of people with that latent story running in their brain that think we'll be able to do that again. And they don't understand we don't have a manufacturing base. We make technology. And seeing the, what I'll call phantom investments in the US Because I think that they're all waiting to see what happens at the midterms. But you've got all these phantom investments in the US we're going to bring all this manufacturing back, back. You've got tsmc. I always forget their call sign, but I think that's it. The chip maker in Taiwan saying, hey, we're going to make this huge investment here in the US which if I'm them, makes sense because if I don't want to be reintegrated with China, I need to have that escape valve of being able to build in the US but setting that aside so that becomes the milieu of things that are playing out right now. You have to bring some manufacturing back so that like just if, if you are correct, and I think you are, the future of warfare, for better or worse, is drones. Drone manufacturing right now is 85, 90 China, just full stop. And so if you, and I'm talking the, the whole, all the parts, everything, even if you're trying to make them here right now, you're beholden to a supply chain that's going through China so they can Choke immediately. And they are anything but stupid. And so if we're moving towards a kinetic war, they just turn that switch just like they sent the beef back. They just go, nope, no more drone parts for you. So I agree that this is a super precarious moment. And boy, do I wish that everybody could just say, can't we all get along? But we won't, that I'll just take off the table. That's not going to happen. And given that that's not going to happen, how else do you play it?

[B]

So I have to first agree with every part of what you said, honestly. But I'll try to give a slightly different twist on a few of them, please. One of them is manufacturing, because I actually agree 100%. But if you and I going back to AI and robotics, just hold on for three years, the entire edge that China had of cheap labor, okay, which now became large manufacturing capabilities, moves back everywhere in the world. Because you can literally hire robots, put them in rooms day and night, get them to manufacture whatever it is that you want, which basically means that cost of energy and cost of shipping become deterrence for you to, you know, to move goods around the world, okay? So basically it is a no brainer that when we get to the point where we take out the capitalist arbitrage, which was the entire idea of a capitalist is how can I get labor or, you know, manpower to do the work for less than what I can sell it for right now, Interestingly, as we take humans out of the workforce, it equalizes across the world. It's five years away. Could be sooner, by the way, if we start with interesting industries. The second is, and I say that with a ton of respect, is when at war, war does not have to be aggressive. Okay? So the idea here of pissing off Taiwan, sorry, pissing off China around Taiwan makes China, who also depends on Taiwan for the chips of everything that they make, right, basically think the same way. So if America has foothold over Taiwan, we, China are afraid. So you're escalating the fear. The opposite is true. The opposite is to say again, like we said with cern, can we agree that Taiwan is just going to be continuing to support everyone? Right? And I think that's a conversation that is very difficult to have. But if it is the switch between humanity's existence and continuation and not it will get resolved. The third, which I think is really where the core issue is, when times get tough, we tend to do more of what we know how to do best, okay? Which is normally what got Things to be tough in the first place, right? So when America competes with China on artificial intelligence, for example, they sort of say, okay, only H80s, no H1 hundreds in Nvidia chips. We're going to sanction you from this. We're going to make it illegal for people to invest in China. We're going to do this, we're going to do that. No more Chinese students can come and study in America, okay? And, and those tactics could work If China was 70 years ago starving to death, okay? When you do you take those tax tactics against this China, they immediately say, okay, how much does it cost for us to create our own fabs and create our own microchips? Right? How much does it, you know, what can, what do we need to change about our students so that they become the best in the world? 42% of all AI scientists in America are Chinese. Who's being hurt by that fight? It's America, okay? And, and it's, you know, it is interesting that the American people are not fully informed of this, that, that, you know, those bully strategies are now met with the world saying, okay, you know what? If, if you're going to sanction Russia by taking $300 billion out of the Russian oligarchs, then by definition, okay, every other oligarch in the world is going to de$ize. Now, instead of you saying, you know what, I'm gonna, you know, tap the table and I'm gonna shout at everyone and I'm going to be even more bully, okay? You might as well say, okay, guys, you know what? I understand that upset you. Can we talk? Right? Because the one that's being hurt by this is the American people, okay? The American policy somehow is running in a way that basically says, do more of what you know how to do best. Now, the more interesting part of this, Tom, and I really urge you to think about this, is that Russia, sorry, China historically has never in all of history invaded outside its border ever. Okay? There was one case in Vietnam, which was again instigated by the U.S. right? And it didn't last for long. Now the, the other side of this is that if you look at the war, at the map of the world today with, with America having 180 plus bases, you know, military bases across the world. China has one that protects shipping through the, the, the Red Sea, okay? They explicitly are giving the world signals that all we want, we don't want to dominate the world like the empire, okay? We want to become prominent for the world, mainly economically, so that we can feed our 1.4 billion people, okay? And I may be wrong, but, but, but there. There has not been a sign of aggression issued by China in your lifetime or mine. There hasn't been one. Okay, so what are we reacting to? We're either reacting to manufactured signs so that we can continue to have our forever war, okay? Or maybe we're exaggerating and hurting ourselves in the process. And I think this is where the conversation needs to happen. Now, there could be. This could mean that millions of people die in Vietnam like we saw in the 1960s and 70s. And the. You know, I mean, some place like Vietnam across the world, which is unacceptable if you ask me. But you know what? American people will not feel it, right? But to bring the war home economically, the way America is doing, it is clear if you're sitting in my seat outside the US that everyone, everywhere in the Global south is saying, I don't want to be bullied anymore. And the minute you give them an alternative through bricks or whatever that says, hey, can you ship to me using my currency, they take it, okay? And somehow it's not that we don't like America, it's just we don't want to be bullied anymore. And in a very interesting way, it's the benefit of America to suddenly say, you know what? While I'm still taller than all of you, I'll make you my friends, okay? So that when you're taller than me or as tall as I am, we can play together. This Cold war is working, believe it or not, against America. And this Cold war, believe it or not, even in tech, in AI is being lost by America. Okay? So deep sea comes in. A manus comes in. Quantum computing chips comes in, come in. They have 105 qubits now in China, okay? And I don't know how much more I can tell the politicians in America. You're not losing. You're not winning this through aggression when it's through diplomacy. Everyone wants your market. Everyone loves you, loves the movies you send us, that we love your music. We, we, we really. We have nothing against America, but the rest of the world needs to also protect their own sovereignty. And more aggression is not helping anyone.

[A]

Okay, so let me see if I understand what you're saying is that you, you, America, need to understand that you, China is a rising power that the whole world has.

[B]

No, no, no, no, no, no. I'm sorry to interrupt you. I'm sorry to interrupt you. China is the world superpower. It is the world superpower in purchasing power parity. They are a bigger GDP than America and have been for a very long time. And most of the world is much more dependent because of the trade deficit of America for so many years. Most of the world is much more dependent on China than they are on America.

[A]

Okay? So you guys have already been passed economically by China. So the Cold War that you're trying to wage with them does not make any sense because not. You're the only ones that are going to get hurt, but you are going to be disproportionately hurt. I'm going to stop there because I think the next thing I'm going to say is going to be a prognostic. It's going to be. I think that statement makes a prediction. But first I just want to make sure that I got that far correctly.

[B]

I don't think you're going to be disproportionately hurt. Is accurate. Nobody knows, okay? I think the rest of the world will probably pay more than the two superpowers, right? But you're going to be hurt. Like there is a way where this doesn't hurt anyone. So, so there is no need for the pain.

[A]

So walk me through the way that this doesn't hurt anyone because you're, you're. What you're about to say is going to be based on your assumption that China is not an aggressive nation. They're a nation of influence, to be sure, but they're not going to put military bases everywhere. They're not going to go into foreign incursions the way the US has. And so therefore you have. I don't know that you'd use these words, but you have nothing to fear essentially from a strong China.

[B]

From a military point of view, the day China puts in a second base against your 187 or whatever start to worry, okay? But it's one military base outside China versus more than 180 for America. You're still the world's superpower militarily, okay? So nobody wants to attack anyone. This is not a war, okay? From an economics point of view. From an economics point of view, the biggest threat I believe America has is not debt, okay? Because you have the military power to back your debt. The biggest challenge in my point of view, I'm not an economist, is inflation and how inflation will hit your nation. And inflation is two sides. One is the cost of goods on, on, you know, American soil, which is going up because of tariffs for imported goods and locally manufactured goods, which will have a margin to increase their prices in. Okay? But more interestingly, it's because everyone is sending you your dollars back, right? So I'll tell you very openly, I'm very interested in classic cars now. I buy most of my classic cars in America. Why? Because then I can send you dollars and get the goods, okay? I can send you dollars that I'm afraid will be inflated into lower value, okay? And then if I. If I keep the classic car here, I can sell it here or I can sell it in Europe or I can sell it in Japan for money. That is real money. As the US Dollar loses. Loses its value. And the risk of inflation in my mind is that American people are paying for it, okay? And America is not the safest place on earth if people become hungry because of the Second Amendment. This truly in my mind. I'm really sorry. I don't have the right. I honestly do not have the right to comment on American policy. I'm just looking at it from a very big.

[A]

This is so helpful. I get it. You have to worry more about the comments than you have to worry about me. But I hunger for perspectives that are not my own. And so getting a chance to look back at America through your eyes is incredibly useful. So if at the risk of you having to deal with whatever people will think, I am grateful.

[B]

I have all good intentions, by the way, for people who are about to comment. I only have good intentions. I'm not against America or against China or against anyone. I'm just basically saying my daughter and everyone's daughter is at risk. And if that means you're going to comment negatively on what I say, thrash me, it's okay. But keep my daughter safe.

[A]

Okay? So, one, we certainly share a belief that inflation is. My audience has heard me talk about this so much inflation is the devastating force that everybody has to worry about. You. You've given me a perspective on China that is very fascinating. One I'd be so curious to get more data on. My understanding of the Chinese economy is that they beat us in some areas and they lose to us in others, that overall gdp, we still win. But you're saying that's inaccurate. That's basically Western spin.

[B]

That's in. Yeah, it's US Dollars, gdp.

[A]

Yeah. So that's very interesting. Also, I have a formulated vision of the Chinese economy as being weak at this point, given all the crazy investments that they made in getting their own populace to buy housing again, I'm perfectly willing to accept this is all spin, please.

[B]

Yeah, there is a huge spin on that. So what ended up happening when America declared economically that they are going to try to slow down is that China is very different than America when it comes to economics because they're able to make a decision at a state level that they don't need to convince the capitalists of. Right? They basically, they simply instructed their banks to stop paying mortgages because housing is less important than industrial capacity. Okay, so what you see, if you want to slice the economy and look at housing and the mortgage crisis and what's happening in China, it looks economy in decline, but as those funds are being reinvested in the industrial capacity, they're building industrial capacity in the. In the spaces where America threatened to starve them. So when it comes to microchips, for example, you know, a lot of the Chinese officials will tell you, within six to eight years, we will be. We will be building chips that are more powerful than Nvidia. Okay, so. So this. This shift economically doesn't mean they're poor. They're just using a different strategy to invest in a different part of their economy.

[A]

The one thing that's clear to me is that Mo is not just talking about AI. He's talking about humanity, how we love, how we build, how we destroy. This conversation is only going to get more intense from here, so make sure you are following the podcast so you do not miss part two when it drops. Mo is going to take us even deeper into the existential risks we are all facing, the more moral questions we can't ignore, and the radical changes we need to make fast. Until then, my friends, be legendary.