Economic Freedom, AI, and the Future of America

What does economic freedom actually look like in an age of artificial intelligence, automation, and geopolitical competition? ISI's flagship long form podcast brings together leading thinkers for a candid roundtable on free markets, innovation, national security, and what it all means for American workers and communities.

Timestamps:
0:00 – Intro: AI, deregulation & tech growth
6:11 – AI and job displacement
8:56 – The GOP's working class vs. economic dynamism tension
16:34 – Are we losing skills to AI?
28:24 – Theology, human dignity & what makes us different from machines
38:41 – The data center investment bubble
52:21 – Industrial policy, national security & reshoring
1:00:29 – Disruption without a path forward: the trucker problem
1:06:31 – UBI, WALL-E, and the dystopia of purposeless leisure
1:10:24 – Closing thoughts: humility, embodiment & conservatism's answer to AI

Project Cosmos: Conversations on the Future of Civilization is a production of ISI, the Intercollegiate Studies Institute. 

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Transcript

SPEAKER_04 0:00

So, Max, I actually want to start with you. So, you uh you you run the Foundation for American Innovation, um, and you're obviously looking at kind of growth, innovation in the tech space, which we've seen a lot uh over the last year of investment, you know, whether it's AI or defense tech generally. And I'm just wondering from a kind of a market perspective, what are the what are the fundamental things that you're looking for, at least in terms of law, regulation, that lead to kind of a thriving uh technology sector?

SPEAKER_01 0:34

Yeah, uh well, first great to be here. Thanks, Johnny. Um the this this administration has taken a really sort of hands-off approach to much of the tech sector, and I think that's been a really strong uh you know point in its favor. Um, you know, we don't know exactly where the new innovations are going to come from, and we don't really know which companies, which researchers, which labs are going to necessarily create the innovations that you know unlock a lot of human flourishing and a lot of prosperity uh you know across the American population across the world. Um and you know, a sort of premature approach to regulation can oftentimes uh slow down that growth well before we even have a chance to uh see where the success is going to come from. Um I think that you know the administration's been really very strong on a lot of uh you know permitting reform regulations, you know, sort of like unlocking energy dominance. Uh they've been very strong on uh you know sort of encouraging new uh data center build-outs. They've been very strong on sort of encouraging a lot of uh foreign investment as well to come in. Um this is a lot of the president's, you know, uh we'll probably get into the trade uh issues uh later on on this episode, but one of the I think positive benefits has been getting a lot of um foreign investment to flow into American companies and American manufacturing. Um so I think all in all that's been a really strong approach. I think there's there's certainly uh you know areas of improvement and there's places for Congress to get involved, but in general, there's been a really uh sort of like deregulatory and uh investment encouraging.

SPEAKER_04 1:57

And what's what's been the most exc over the past year as you've had more of that? Yeah. What's where what are the areas specifically where you've seen the most growth, I don't know, compared to two years ago?

SPEAKER_01 2:08

Yeah, I mean, I I I think you know something like a third of uh you know US GDP growth over the past uh year and change has been due to data center investment. Um, we've seen quite a lot of new investment in energy technologies, right? Uh you know, the president has committed to 10 new nuclear reactors by the end of his term. Um, you know, and you know, Westinghouse and some of the other uh companies that build these large AP1000 reactors have already taken, you know, secured a lot of uh private financing to help make that happen. I mean, the lat the last time we built a nuclear reactor in America was uh, you know, in Georgia down at the Vaudley plants, and uh that went you know historically over budget and uh caused a lot of problems for ratepayers. And so there's uh a lot of like learnings that I think this administration and the various state governments that are gonna be hosting a lot of these reactors are uh taking into account there. Um, you know, I think the the defense tax boom has also been uh really shocking to see. I mean, I think Andrew something like doubled their revenue over the past uh year. Um and and yeah, like I think this has been like a sort of salitary competition for the you know defense primes, right, who are often sort of criticized as sclerotic, who are, you know, a little bit of irregulatory capture, a little bit of you know lots of inefficiencies. Um and yeah, I think like just sort of the the the ongoing you know threats to the you know sort of stable world order, the uh you know, concerns with competing with China, the uh you know, sort of you know force projection of the US around the world, um, has all sort of like necessitated a uh new investment in like domestic manufacturing capacity, particularly for defense. And um, I think you know some of the you know small-time startups in uh El Segundo, California show show the way back uh for restoring the defense industry in America.

SPEAKER_04 3:47

Tim, in terms of uh obviously uh with a more especially towards uh AI kind of hands-off or uh you know not as uh the constricting framework that the Biden administration had can be confused and constricting. Uh so we've we've seen this sort of unleash of of growth, building data centers, et cetera. But I'm curious, sometimes when you have them the period of growth and there's the backlash, I'm curious with you know just popular sentiment about data centers, whatever, AI, uncertainty about the future. Do you see is it inevitable that I guess these cycles of innovation are then followed by skepticism about the markets that run about or have you?

SPEAKER_05 4:27

A data center in your area is not like it's not necessarily it doesn't have local benefits. Like if you opened a factory and suddenly every high school graduate could get a job. I mean, there are jobs for building it and there are some permanent jobs. And I've, you know, one of the places I go a lot to sort of track the decline and fall of post-industrial America is uh Fayette County, Pennsylvania, where Uniontown is, and they're talking about putting in a big data center there, and I'm gonna follow that really closely because this is where is that specifically? This is south of Pittsburgh. So Pittsburgh has recovered from the collapse of the steel industry pretty well. You go down, and this is right on the West Virginia border, and um, you know, the one of the top counties in drug overdoses, one of the top counties in uh in, you know, uh high school dropouts, all these negative indicators, while eighty years ago it was like heaven on earth. Graduate from high school, get the steel job, work 30 years, beautiful scenery, retire, yada yada. Yeah. Um and so they're they're gonna get one of these data centers. They're gonna be temporary jobs, there will be some permanent jobs. I don't know how much that trickles out and really helps the local economy. Now, if you are a governor, you see why you want this. It increases the GDP. Our former governor in Virginia, Glenn Youncke, and he supported a lot of these some with subsidies. And it increases the state GDP, it brings in some jobs, it brings tech CEOs to you as a governor and starts to make you think like you're uh a high-tech state. So the question is gonna be, how much does uh do these data centers trickle into the local economy? Or how much are they just big ugly ice horse? And then the the other thing is is AI gonna take my job?

SPEAKER_04 6:11

Yeah. Matt, what what do you think about the in terms of the the shocks that could come in terms of jobs? I mean, what how are you politically like what's the calculus there for you?

SPEAKER_01 6:21

Aaron Ross Powell Yeah, I mean, I think there's a lot of problems uh that come with, you know, uh you know, Frontier Lab CEOs saying that something like, you know, 50% of white collar work is gonna be automated within the next five to ten years. I mean, I think both Sam Alm and Dario Hamiday, um, CEOs of OpenAI and Anthropic, respectively, have made versions of this claim over the past year and change. Um the uh you know, where where we see this automation coming first, too, is not necessarily going to be simply white-collar jobs. Because I think there's there is sometimes this like sort of perverse incentives among like you know, conservatives who you know look at you know the lawyers and the accountants who uh you know have increasingly drifted away from the Republican Party over the years and say, oh, well, you know, the the libs are gonna get automated first, and you know, those those woke developers in San Francisco, like you said learn to code, and look at you, you're uh you're the ones first out of a job. Um but no, I mean like you know, look at uh truck driving, for instance, right? Like truck driving is still a relatively stable job. It employs a huge chunk of Americans. And uh I think we're very close to seeing automated truck drivers uh or automated trucks uh you know screaming across American highways. Um, you know, I mean, I don't know if you guys have had the chances to take a Waymo uh if you're ever in San Francisco or Phoenix or Austin. I think they expanded to like 10 other cities uh over the past couple weeks. Um and yeah, like that that is the future. Um, you know, now now will that uh come with political backlash, come with uh, you know, political costs? Certainly. And I think there's this sort of emerging coalition of sort of tech-skeptical populists and uh progressives. You know, you see like Bernie Sanders and Steve Bannon agree or more than disagree on a lot of their criticisms of these uh you know big tech companies. And um, I think that coalition's only going to grow in strength over the next four years.

SPEAKER_07 7:59

Well, that kind of raises the question of does this lead to an upheaval of the existing political coalitions, right? So under Donald Trump, the Republican Party has become increasingly working class, increasingly geared towards protecting jobs for people who've seen jobs and work, leave their communities, leave their states, leave their general areas. Yet at the same time, the Republican Party, even under Trump, and it partly due to some of Trump's own policies, has remained the party of economic dynamism. It's remained the party of economic growth. And it's it's it's done that in a in a political environment in which tax cuts don't seem to have the same luster for voters that they did during the Reagan era, uh, where deregulation is certainly something that the Trump administration has been very committed to, but doesn't necessarily seem to move votes in quite the same way. And the Republican Party has a much more complicated relationship with business than it used to, while still very much being funded by business, even though it's supported electorally by the working class, and uh the Democrats are trying to find ways to sort of exploit some of these contradictions too. Now, the th some of these have have existed, the contradictions at least, since at least the Reagan era, right? So, you know, some people looked at the Reagan 80s and they looked at small-town Americans, they thought that is what Reaganism represents, and other people looked at Gordon Gecko and Wall Street as as a good thing, not a parody of a thing, and that to them was what Reaganism represented, and and and they and some conservatives and objectivist libertarians didn't think that was a bad thing.

SPEAKER_04 9:49

We hope you're enjoying Project Cosmos. If you'd like more content like this, please like and subscribe or sign up for our newsletter, the Intercollegiate Review, in the comments section. Being in this kind of conservative intellectual world, obviously there's, you know, on one side, it at one level it seemed like, oh, there's this tension between sort of the whether it's the populist, the protectionist, the industrial policy sort of wing versus the more free market wing. But then there's sort of a an interesting way where at least right now, these two are almost it coexist. We know we voted to keep the tax cuts, but the government's taking more direct role in comes with the city.

SPEAKER_05 10:32

If you go back in time to the Tea Party, 2010, uh I would go through any, you know, there'd be exciting Republican primaries, and you'd go through, and you even if you knew nothing about the candidates, never heard them speak, you could look at who their donors were. One group was basically funded by the Chamber of Commerce, and one group was basically funded by it was Freedom Works, it was Club for Growth, and so you had the Tea Party was more free market and was disliked and disliked big business because the big business lobby was the the sort of Republican establishment and the Obama administration both were, well, we're gonna work with big business, we're gonna subsidize them more, we're going to regulate the Obama, we're gonna regulate them in a way that benefits them. That's why you had all this big business support in pharma insurance industry, uh hospitals all behind Obamacare. Uh the big banks ended up making out fine from the Dodd-Frank financial regulation. And then the Republican version of that was, you know, uh my old favorite uh bugbear, the export-import bank. Or um like Southern uh uh, you know, the the big power companies say, you know, if you're using nuclear power, you're not gonna entirely build it up in a free market way. So you're getting loan guarantees, you're getting some insurance protection. And so the the Tea Partiers were like, no, we're gonna burn all that down. So we we talked a lot about free market populism, and a lot of the the the more conservative the member in uh in 2009 and 2010, the lower their voting score from the Chamber of Commerce. So that worked when Republicans were out of power and when Obama, who was this like, you know, uh corporatism basically, like a little bit bigger government together with big business, when that was what they were running against. When you come into power, it's necessarily going to be more complicated. And so the popists then were arrayed against big business, but Trump obviously doesn't subscribe to that ideology because he doesn't really subscribe to any ideology. He's a thoroughgoing pragmatist who believes what the guy at the end of the bar believes. And so he is simultaneously doing the the populism that Jim is describing, but also doing it in uh industrial policy type way, buying stakes in all these different companies. And then because he's impressionable, it's kind of like the last guy who gets his ear often gets the policy made, and a lot of times that's gonna be a CEO. Trevor Burrus, Jr.

SPEAKER_04 12:56

Matt, so your background is in you're sort of a student of Robert Novak and World Finance. Michael Novak. I'm Robert Novak. He's Michael Novak, yeah. Michael. For the record.

SPEAKER_00 13:09

Michael Novak. Yeah, and I'm still an active investor, like in the middle market kind of private equity wall. That's what I kind of grew up in. I I I'm not so sour on the market, and I feel like you know there's a basic principle of AI investing that you could see in the history of any investing, the dot-com bubble, the mortgage crisis. You go back, there's an overinvestment in something, but the middle market seems to pick up all the innovation of figuring out how to make AI productive in the actual everyday lives of people. So I'm not an AI bubbles gonna bust type person, but I just Well, what's an example of the middle market?

SPEAKER_05 13:48

I don't know all these terms.

SPEAKER_00 13:49

So, I mean, to put like financial terms around it, let's say it's a company's less worth less than two billion dollars. That sounds like a big number, but most of the investments I deal with are probably worth 500 million to 1.5 billion dollars. But we do things as basic as a call center. Like when you call certain banks and you're looking for fraud protection, like you're actually calling us. Or a firewall between the bank, if you will, and essentially you as a customer. Um everything, grain feed. Like one of the things that we're really interested in now is actually um what I'd call materials. Now, what's happening is all this capital flows to AI, but by definition, the more capital that flows to something, its returns are gonna go down. And if you think about it just classically, like more too much money goes to something, it can't produce enough earnings to meet the return. So what you look in that case, and this is what I'm kind of a contrarian, you look for the things where the innovation is actually gonna work that's being underinvested in. So like we are looking at things that it's crazy how these basic materials. You don't think about it, but your everyday life is still driven by the ability to drive a car, eat food, I mean the packaging the food goes into. So it's like, I feel like there's a big business world with policy that kind of like gets shaped, but then there's still a lot of regular Joes, if you will, running companies with $500 million in sales that make silly little things that you don't think about, that as the AI kind of works its way through that industry, we'll see innovation actually produce real returns for society as a whole.

SPEAKER_01 15:25

Yeah, I mean, I think there's a lot of good examples here too, where like, you know, you can think of uh, you know, regular Joe who has like a coffee shop or you know, maybe someone who's a little bigger, you know, you run a small manufacturing shop in Dayton, Ohio, or what have you. And uh there there are like you know real practical applications of AI tools, making, you know, for instance, your accounting way easier and you know, like creating some new efficiencies and helping you save some money and save some time and allow you to focus more time on you know what you're compared to actual character advantages, right? Running your business. Um, so I I think there's a there's still going to be a lot of sort of like positive debuts in that realm, but I don't think those stories necessarily trickle up. Right. You know, people are mostly talking about you know whether it's like catastrophic risk or you know a dispute between the Department of War and Anthropic or the sort of like, you know, will we get 10 billion or 14 billion from Saudi Arabia to invest in more data centers and energy infrastructure and so on and so forth, right? Like I think some of these smaller uh implementation stories don't get told as much.

SPEAKER_05 16:18

Trevor Burrus, Jr. I mean so what you're talking about is if a company doesn't have to I always think of this one study recently and it was sh they were teaching kids, one of these tech companies were teaching students coding, and they let some of them use AI in studying and some of them not, and you know, in doing their projects. And the ones who used the AI to learn the stuff and apply it retained it a lot less a couple weeks later, which is unsurprising. And this happened to me where I, you know, I started using because Google doesn't work nearly as well anymore. So I started using AI as a Google replacement, and uh I had actually forgotten all the research I had done for a column when I went back to the topic two months later. Used to be there was this cross-training thing almost. You have these massive reams of paper, you study it, you go over. The time I saved, the what the price I paid for it was not retaining it as well. So I always think what are the things where I don't want to be building skills and retaining? And so it was busy work.

SPEAKER_07 17:17

Um my ability to spell has deteriorated sharply since I've been using spellcheck. When when I didn't have the uh access to something like spellcheck and I hadn't remember how to spell words correctly, I was actually very good at it. Jeopardy, uh you know, not so much.

SPEAKER_05 17:36

But if you can um J-E-O, don't forget the yes. Um if you can uh as a company stop dealing with the busy work that's not actually core to what you do, you can become more efficient. So you're suggesting that like a lot of little companies that do everything from like small manufacturing to services might just get better at their job, their price is lower, and the US economy approves. Is that like the main case for AI improving the economy?

SPEAKER_00 18:06

A good example of this would be this, because it's really here's the thing, and it's funny you say Google. I just view AI as just advanced Google search. And so I still teach a class at the University of Maryland on entrepreneurship finance. Computers are put away, I give them articles to read, and we had due group discussions. I don't even ask them to write papers because three-quarters of the papers are going to come out of AI. They're not exercising their mind. But let's just say you have a manufacturing company with maybe five or six locations, and you've got a guy with a problem on the manufacturing line in Indiana, and he goes into the knowledge base that only is pulling the data from your company or maybe from a select group of manufacturers, he looks up a question in that AI and he finds out, oh, I just if I adjust that bolt and that nut, the machine works again. Like it would have been really hard for him to know that some guy in a fact another factory has figured that out. So it's more about uh, if you will, sending the information across the organization. And if you're a mid-sized company, let's say a billion-dollar company with two or three manufacturing plants, there's an immediate like gain from this technology. And if you could scale that up to Toyota, Toyota, I my understanding is doing the same thing, let's say. You know, a factory in Indonesia can learn from the factory in Indiana.

SPEAKER_05 19:25

And that helps the broader economy or helps me because if Toyota's manuf costs are lower theoretically and their competitors' costs are lower, the prices could come down.

SPEAKER_01 19:34

In theory. In theory. I mean, you know, I I I think the the way to think about what Matt's talking about here too is that uh AI does do a very good job of organizing large, you huge swaths of information and taking some of this tacit knowledge that's oftentimes like localized in one guy in Indiana or you know, a team in Tokyo or something like that, and can, you know, you you you can make that information more easily retrievable and more shareable across uh the larger company. Um, you know, now I think there's a lot of specialized work and implementation. This is why folks talk about AI diffusion as the real barrier to, you know, sort of seeing AI uh benefits to the economy writ large. Because I think that those diff that diffusion across a company, across firms in general, uh takes a lot of time, takes a lot of specialized implementation. And so I do think it's uh it's it's not credible to me to say that, you know, we're gonna see the you know mass job loss anytime soon caused by this technology. But I do think it's credible to say that uh you'll see like real productivity gains and real improvements within the next you know three to five years that could flow down to the ordinary consumer, right? In the same way that like a you know automated uh trucking, you know, there will be some folks who get put out of work. But also if you can drip drop shipping and logistics costs down, that that is oftentimes a large chunk of the overall cost of a product you buy. You know, like you know, I I love Amazon. I you know, I you know, my my uh we're about to have a kid, and so like you know, the the the the convenience of being able to just like one-click ship is is great. And if I could see the cost of the diapers come down a little bit because they're I'm not paying for as much shipping costs, that'd be ideal.

SPEAKER_05 20:59

And if a small uh you know artisanal manufacturer or whatever has access to like better shipping because we have now AI-powered drones or even small delivery things or or networks like that, that could also create opportunities for more sort of small businesses to uh expand rapidly, I guess. But part of I mean so what I worry about when I think about the the jobs, I mean, obviously I don't want to lose my job to AI, so I am spending more time as I put it to journalism students, being in a place with uh other people, like being in a room. So th whether that's get good at public speaking or go to that bar in Western PA and talk to the guy at the bar. But then I think uh our sort of you know, middle aged people are not as threatened as the the entry level job for the last ten years in journalism has been breaking news reporter.

SPEAKER_07 21:52

Which is predominantly aggregation. And those are the first types of of jobs in journalism that AI So then the whole sort of how do you enter into journalism as a profession changes. Now that changed before changed before.

SPEAKER_05 22:12

I went to a a village home meeting as my first journalism assignment when I was in high school, and that kind of disappeared for the worst, I would say. And it became the aggregator thing. So I mean to some extent as a conservative, you have to be humble enough to say, I don't know what's going to replace it. But also as a conservative, you say, this is a dramatic change to a really complex system and it could end up going really bad.

SPEAKER_07 22:33

Yeah, I I every morning wake up and I do this test, am I still smarter than AI? And I I enter in some search criteria and I'm like, nope, that's wrong, that's wrong, that's wrong. I remember this, this is wrong, and then you know I go to work. But one day AI will probably be smarter than I am, and that's going to raise you know all kinds of challenges. Trevor Burrus, Jr.

SPEAKER_01 22:55

And it's not just germ journalism too, right? You know, we can think about uh you know if I'm if I'm graduating from law school right now, I might be a little worried about um you know my ability to find a good work because again, a lot of the work of an early uh career legal associate, right? You know, again it's processing you know huge huge amounts of information, it's surfacing little little insights or little you know key key phrases from a deposition that might be useful in the case one day, right? Uh that sort of work, you know, it's it's drafting memos and reports and briefs for your bosses, your your highly compensated partners and whatnot. And I think that work is going to be uh you know increasingly uh done by AI, or at least like, you know, maybe a first pass will be done in AI. So I think in the short run we'll see some productivity gains, sure. But in the long run, right, uh I can certainly see the early career pipeline drying up. And you know, uh, if you want to have a career as a lawyer, I think you're you're gonna have to start thinking a lot uh differently about how to do your sort of day-to-day work.

SPEAKER_05 23:44

But again, the middle level lawyers, the slightly more senior lawyers will become a lot more productive because they have something faster than 25-year-old associates. Trevor Burrus, yeah.

SPEAKER_01 23:55

Yeah, it's like having a 25-year-old associate who you know doesn't drink, never goes home, goes to bed, you know, is available 24-7. I mean, I think they're already treated like this in some white shoe firms, of course. But um, yeah, or like or like think about software engineering, right? Like uh, you know, mid-career programmers right now, like folks who really understand their stuff, are m vastly more productive with coding agents and you know can produce like you know, I think I think the time horizon on the latest frontier models is something like the an equivalent task that would take a human programmer of 14 hours, right? So like two days of work uh can now be d done in one shot, you know, five, ten minutes of you know token processing by by an AI, right? Now, software engineering is not the same thing as you know knowledge work writ large, but you know, it's much more verifiable, it's much more easy to see does the code compile, does it do the thing I want it to do? Um, so it's so like right now, like those folks are gonna become way more productive. This is the sort of human centaur model. Um but in you know the future, right? Like, you know, if I'm an 18-year-old who's trying thinking about getting a computer science degree, I might be thinking a little differently about what I want to spend the rest of my life doing. But that also admits.

SPEAKER_05 24:55

Unless they know what path to go down, this is could be disastrous. If the career prospects, the job prospects for 20 somethings crater, that this is the that's the last thing we need now, that you know the marriage rates, birth rates are collapsing, extremism among 20-somethings is going way up, hopeful hope about the future is going way down. I mean, I maybe we can breathe a sigh of relief. It's like, okay, we're a little established, maybe it's maybe it won't take our job until we're at retirement age or something. I just take that ladder up, you know. And I mean, um my first thing would be I've always tried to talk young people out of going to law school, and now I will do it with twice as much uh vigor. But also I I wor like, are we going to regret AI even without some it it taking over in some Isaac Asimov's way just because it dries up work opportunities for especially men in their in their twenties?

SPEAKER_07 25:50

Well, it's interesting because you know a lot of the theory behind Trump's appeal uh uh surrounded the idea of of work disappearing from various communities. But it's pretty clear in the last five years the way the public has assessed the health of the economy is based on affordability. So they're very dour on the economy, even with relatively historically speaking, low unemployment rates because things are so expensive. Now the you can quibble to some extent w over how robust the the labor market has has truly been. Uh but you know, four and some change percent unemployment is is has historically speaking generally been pretty good. People don't seem to care about that because of of the cost of living. Now, is that an artifact of the the four the inflation hitting a 41-year high with a lot of people who are adults having never really lived through a period of broad-based inflation the the way we've seen it recent years? Maybe so. And maybe if we did start to see true instability in the labor markets, uh and also seeing these things affect a college-educated, white-collar, articulate class of voters and not and not just, you know, the the the uh hypothetical working the stereotypical working class. One of the reasons the 1992 election was so disastrous for George H.W. Bush was that the aftershocks of the 1990-91 recession, which had actually ended before Bill Clinton had even formally declared his candidacy, uh, but the aftershocks of that really disproportionately affected a lot of people who voted Republican. And that wasn't always the case in previous economic downturns, especially back when the Republican Party was the more affluent and was the more educated party. Uh so a lot of those voters were angry they defected to Ross Perot or even Bill Clinton. And so, you know, maybe on the economy we're all fighting the last war with the affordability crisis, or perhaps not. But but AI is an interesting issue in this area because it's it's easier to see how it would solve price problems than scarcity of jobs-related problems.

SPEAKER_04 28:23

Aaron Powell So Jay, I want to turn to you. We're talking about AI innovation. I'm wondering from a theological perspective, you know, who are you seeing do good work on kind of this current moment where we're headed?

SPEAKER_02 28:37

Well, I I'd like to say there's a whole list of people doing that. I think a lot of the work, frankly, is still to be done. Um I'll say as a Catholic at the rumors that Poplio is uh uh working on an encyclical or at least a letter of some sort on artificial intelligence.

SPEAKER_03 28:50

Are you advising him on this?

SPEAKER_02 28:52

I I you know, no comment, but this is this is I think that the sort of crux of the issue is that technology in general and AI in particular, it's sort of all the really interesting questions coalesce around this. So, what is the nature of intelligence? What's the nature of the human person? What is consciousness, right? Big philosophical question. What are machines? What is technology ultimately uh related to human beings? And my own view, I think it's a sort of standard uh Christian view, would be that God's created us in his image and we can create value with the things God has provided uh to create more value. And so I don't really see AI or computing or machine learning or any of those things in any different sort of way. And so I think we can look at history as a guide and say, okay, it's not we're not getting replaced here. I think that's the kind of key, the key lesson. And that answering that question, though, sort of requires that you have a particular view about what a machine is and what a human is. If you think we're really just machines, right, just sort of machines made of meat, I then you should probably worry that we're gonna literally get replaced. If you think we are creative agents made in the image of God, fully material, but also fully spiritual, then I think that gives you a reason to think, okay, maybe that's not what's going to happen. And then if you actually study, for instance, what's happening in the large language models, I don't think there's any good reason to think, okay, these things are statistical calculators of a bunch of numbers or tokens. There's no reason to think that they're going to wake up. Um, and so I honestly think a lot of the really serious reflection uh is still to come because it requires sort of combining those things. And so the problem is that, especially I'll I'll just speak sort of uh in in the sort of Christian circles, is that you might have a proper anthropology, but not actually understand what's going on with respect to the machines. And so worry about something that you really, for theological reasons, shouldn't worry about, precisely because you don't kind of understand the details. And then on the other side, we've got lots of tech wizards, many of them clustered in Austin and California, that have a completely bizarre anthropology and metaphysic. And so they're freaking out because they think they're just about to create the artificial general intelligence, by which they mean, I think, Skynet waking up and intentionally killing us all or something like that. And it leads us to worry. I think about things that are very unlikely to happen, to put it modestly, so that we don't actually worry and do the hard work of thinking through what I think is really going to happen, which is massive disruption from the technology.

SPEAKER_05 31:21

Well, one of the disruption I worry about is the bad anthropology that it will unthinkingly teach us, or that we will unthinkingly absorb from it. The medium is the message, is that old thing. So what so I already think social media pushes a sort of anthropology. I don't have all the the best words for it, but it is a hyper-individualistic, it is a materialistic, it is a short-term thing, and AI could theoretically accidentally teach us that we are something different from what we are. Trevor Burrus, Jr.

SPEAKER_02 31:51

And so Tim, I mean, the and I I think we're all becoming acutely aware of this. I could say ten years ago, I was worried about the content in social media. Anybody that has kids, it's like, okay, I don't want them seeing porn, uh, there's a bunch of podcasts I don't want them to see, right? We weren't thinking about what how it habituates us. And I I'm absolutely convinced, I can't prove this, but the massive increase, for instance, in uh the incidence of gender dysphoria, especially among girls, uh really tightly corresponds with the advent of the smartphone and social media and social media influencers. And it's not just that they're bad social media influencers, is that this it's that an interaction, say, of a 12-year-old, very sensitive girl to her smartphone in her screen in some ways encourages her to be disembodied, to think about her identity as this sort of other thing that's that's not embodied, and she would have learned something else if she had been working on a farm and cleaning up stables. I think. Is that the idea? Because that's the thing I'm spending more and more time now worrying about.

SPEAKER_05 32:47

And accepting unchosen things. Like this throughout all of humanity, you never thought like I am the author of myself. Like you got handed stuff. Right. Um and that You did not build that. Yeah. And then now you do get to sort of build your identity again, regardless of the content that's choos chosen, that's the uh that's the message.

SPEAKER_04 33:06

Aaron Ross Powell Max, what on uh I believe you were at the summit on uh AI and labor last week. That's right. That's right. I'm curious, sort of in one level we're looking at it kind of AI and and theology. What about on that labor kind of question? Uh to what extent do you see, I don't know, i synthesizing or kind of conscious thinking about labor in the tech world as they're innovating?

SPEAKER_01 33:29

Yeah, um well, like many of the folks here, I'm you know Catholic, I believe, you know, very strongly in the dignity of work and that like work is sort of, it's not just a sort of uh, you know, input and outputs question, right? Uh, you know, we're we're we're not Fordists, right? Like we do believe that there is like an inherent uh dignity to work, that man is made to work, right? This is like the original commission. And that uh, you know, uh very important parts of our meaning, our identity, our uh you know, sort of why the heck we we even spend time alive in this world, right, is to do labor. Right now, um, you know, I think the interesting question with artificial intelligence is uh what portion or what uh you know sort of like segments of labor it can automate, right? And uh it seems to be going after, as we've talked uh about before here, like you know, going after knowledge work first. Um and uh you know, if I'm if I'm a plumber in Dayton, Ohio, right, like I think I'm feeling pretty good about my job prospects over the next uh you know, next 10 years or something like that. Um, I I I I do think that uh you know, to Tim's point about uh you know the AI taking away the busy work that he doesn't really particularly want to develop any skills or habituation in. Um I think that's uh that that that's that could be a benefit, right? Because like, you know, it's at some level, right, we always sort of romanticize our work, right? Like, you know, you you know we we identify ourselves as a doctor, a lawyer, a think tanker, a scholar, uh, what do you do, which is the first question that you get asked anywhere in the DC area.

SPEAKER_07 34:47

And probably most major metropolitan areas, right?

SPEAKER_01 34:49

Well because I mean, look, you spend the majority of your life doing this, right? I mean, it should it should be important. So I think it should ask, lead us to ask some interesting questions about like, you know, what's the kind of work that I do that I'm capable of that's like a sort of expression of my unique human potential and capabilities, God-given capabilities, um, that you know, it it that I will still do, right? You know, like you know, if I if I'm uh, you know, maybe maybe I won't be entering as many numbers into spreadsheets anymore, but is that a sort of like essential part of my identity? I'm not so sure. And um, you know, now like you know, when we go to art and music and you know, sort of other expressions of human capabilities and human potentials, right? I'm still very bullish on the humans and very bearish on the on the machines. Um but I think composers.

SPEAKER_05 35:28

Like somebody writes music. I feel like that that skill will be degraded if what a a non-musician using a tool can do can come up even slightly closer to the ability of a uh a composer. I feel like art artists have the most to worry about.

SPEAKER_01 35:47

I'm not sure I agree. I think there is uh, you know, it's certainly true that these machines can't, you know, you know, whether I use Suno or ChatGPT or Gemini or whatever, right? That I can you know produce a lot of slot, right? I can produce a lot of bad music or I can produce a lot of like really ugly art or like you know illustrations from my articles. You guys have all seen this, right? And um, you know, but but I do think that actually like increases the value of human create curation, not decreases it, right? Like I think uh you know it in a sort of like a s a sea of you know bad AI generated articles, right? People are going to seek out you know truly unique, truly human constructions more. Um right now. I hope so. I mean I certainly noticed this like anecdotally among like my community of friends and um you know and and like you know colleagues, right? Is that like you know, there there's an increasing amount of slop that we have to just like filter through on social media, and uh you know that actually just increases the value of sort of private networks, of private group chats, of private places to have conversations where I don't have to fear that like you know a bunch of Indians uh you know generating a bunch of really, really like bad tweets is gonna completely pollute my timeline, right?

SPEAKER_02 36:49

Like it's Max, I'm gonna because an analogy to this might be uh the fact that we have streaming music, right? I can't remember the last time I bought a DVD, for instance. And so um you could think, okay, well, now everyone has access to almost free music, almost anything that's ever been recorded is available. Therefore, the value of you know actual musicians is going to go down. But I don't think the value of musicians in live performances has gone down. Right. Uh in fact, I'm pretty sure that the the you know the near-free availability of digital music is corresponded with a spike in that. And so this is the thing that I think we imagine that because everything can be automated, it will be automated, and everyone will always value only the automated stuff. It may be that the you know, once we uh are able to get drone and robotic supervised hydroponic uh, you know, Boston bib lettuce, which I think you can kind of do now almost at Costco, uh, that everybody's not going to keep eating that. That lowers the cost of food overall. And a lot of people that have extra income become much more interested in eating the local regeneratively grown stuff you know in their farmer's market, which isn't it's actually what's happening. So I do think that the possibility of just radically changing preferences as people become aware, either of something that is sustenative or even AI slop or kind of good AI stuff, maybe we come to value. Okay, I want I want the kind of rougher stuff that's you know done. And the only way to get that is maybe live performances or something like that.

SPEAKER_00 38:21

So this is going to be a little bit like not off-topic, but it's very specific to something I was trying to say before. I didn't maybe say it the best way. And there's a chart out there, I wish I could find it, where it's like the Tennessee Valley Authority, the Manhattan Project, it lines up a bunch of historical things, and it's not equal to like one year of the spending on these uh data centers. The problem I have as an investor is I don't see where the return comes on the data center. So I feel like the market may solve part of the problem in that. So let me step back and say this. The software model was asset light. I wrote code, I replicated it, and I sold $50, you know, versions of the software thousands of times over, and I had minimal marginal cost. Now I've got to buy property, build it th build a data center. And my understanding is these chips may only last three to five years. So now I've got to build the center again. Well, they depreciate very quickly. They depreciate very quickly because it's the difference between your computer doesn't the data center depreciates very quickly. But they don't go to zero marginal cost like the zero marginal cost. And if people realize that all the there's two things. I'd say AI for inside the corporate environment makes a lot of sense. And that's what I was trying to describe before. AI to the general public, I'm not sure if it makes sense and has a return. Like if you notice at the Super Bowl, there were a ton of ads for AI, just like there were for crypto a couple of years ago. And it's like, what is the return on this AI investment? As an investor, when I go in the rooms and I meet with other investors, everyone kind of scratches their head because, like, I don't understand what's the revenue model, how am I going to make money on that $300 million data center? And they all look around each other and we're like, we're not exactly sure. How are we making money on this thing? So I kind of feel like the market may solve a little bit of the problem in that this overinvestment in the data centers could contract very quickly.

SPEAKER_02 40:21

As long as uh the electricity has a a normal market with uh price sensitivity as opposed to the weird markets of utilities where a lot of this stuff gets hidden. You know, I mean, this is the difficulty. It'd be really nice if we had just a simple uh competitive market for electricity, and I I think these things take care of themselves. You know, the problem is that's not how almost any electrical utility is, unfortunately.

SPEAKER_04 40:42

So, all right, expand on that. Yeah, absolutely.

SPEAKER_02 40:45

I mean, so there, of course, President Trump has spoken about this recently, and so there's sort of increasing concern. I'll say among, you know, sort of conservatives, people like a lot of us, you know, ISI type people, that okay, let's see if I'm a normal consumer uh and a big new data center gets put in, uh, it's only gonna have 50 employees. It's not gonna be like it's gonna be massive sort of increase uh in the the jobs uh uh bank, you know, in the area, but it's gonna use huge amounts, huge amounts of electricity, and so it's gonna raise the cost dramatically, you know, just simple uh supply and demand stuff, unless we can build more sources of electricity quickly or at the same rate. And it's almost certainly the case that doing that is gonna lag behind the need for data centers. If we have, though, a sensitive market for electricity, right, then this is what happens whenever you get an increase in demand and there's pressure on the supply, is that you very quickly get more supply because you know entrepreneurs will provide the supply at a higher price. Utilities, though, that they're sort of semi-controlled uh markets in which you functionally have price controls and they negotiate with sort of different clients and things like that. So that this is honestly my worry is that it's not like normal markets that respond very quickly to those changes. It's gonna be sort of awkward, it's gonna require changes in regulation for the utility of the state and the federal level, and that that's like the slowest thing.

SPEAKER_05 42:09

And the more that you require that you rely on regulators or the state and federal uh folks who are gonna be subsidizing these things, the more they're saying, okay, well, let's let's get together, decide the future path of AI, and make sure we pave that. And we know that they're they're not that they have zero.

SPEAKER_02 42:27

We want more families and you know, if I have family credit, they're gonna be wrong.

SPEAKER_05 42:31

Like the reason like we that we believe in the markets is because a bunch of people are gonna make a bunch of predictions, and some of them are gonna be right, and that's gonna be rewarded, yada yada. So I just think I think it's probably good that Governor Shapiro in Pennsylvania is talking about reopening Three Mile Island. This is what Microsoft wants to do to power their data center. That probably makes sense. But then when you look at it, Shapiro's like, well, we're gonna do it this way, and this is gonna be the deal with Microsoft. And if it's all short-term and the net effect is these private companies have their capital on the line and Pennsylvanians get more energy, that's fine. But we know that they steer it. I always use the example of um in the Obama years, uh you might not remember this, but Elon Musk was an Obama nomics uh protege or he was a max donor. And uh but he also he had Republican friends, and in Nevada, I think it was a a bipartisan thing to make a massive battery factory, totally paid for by the taxpayers. And one of the suppliers had this quote where he said, I was experimenting with and investing in 18 different battery technologies. But Elon has settled on this one, which is good for Elon, it's his business. So now that this factory is getting built, I'm throwing out these 18 other battery technologies and just going down Elon. So the government has this ability uh to just choke off different uh paths that a free market could lead us down. And again, if it's nuclear power, government's always going to be involved. It seems like it's the future. These politicians want to put their stamp on it, and that can definitely choke off innovation.

SPEAKER_02 44:07

And I do think the key thing is that at least the private investors are going to be sensitive to the market, and so they have an upside and a downside. Politicians usually don't, as long as they're doing something popular in the moment. If the downside's eight, ten years out, they're not going to horizon with J.

SPEAKER_05 44:22

If if if Shapiro, I I referred to uh Western PA earlier, but if he can say in Harrisburg and Western PA, we're gonna bring in all these AI jobs, that only has to be convincing until November 2026.

SPEAKER_04 44:37

Matt, from an investment side, you're saying there's look looking around the room at the uh and saying where are we gonna get the returns from? Is that stopping the investing though right now, or are they is it still just throwing money at it?

SPEAKER_00 44:48

This is an interesting question because it doesn't seem to be stopping it. But I mean people kept buying mortgages right up until the kind of the mortgage crisis collapsed and people kept investing in dot-com companies right up until the dot-com bubble burst. So I don't know what the thing is that pricks this bubble. So I'm kind of betraying my opinion on this. I think there is an AI bubble in investment. Um I don't know. It's it's one of these kind of things where my investment position is to be somewhat contrarian to it, like I mentioned before, because I uh having worked with and for and in software companies, I still don't see where the return comes from. I don't see the revenue model for it. So when I like I said, when I saw those Super Bowl ads, I'm like, they're trying to get people to use these things. How exactly are they gonna make money off of it? And and our own organization that we both work at, like, we're looking at buying like AI product and stuff like that, but when we dig through these contracts and these agreements, like they want to own all your data, and you've got to do all these things. It's an owner's contract, and we're like, well, we're not sure if we can even do this.

SPEAKER_05 45:52

But but I mean, could that be what the profit model is? It's just the you get to learn everything about everyone and then sell that. Like a supersized version of Facebook or whatever.

SPEAKER_00 46:05

Aaron Powell I think that's actually what they were trying to go for because I do think there are these people, and this is outside my realm, Jay could talk to this like I think there are these people who believe in the singularity or whatever they call it. I know, I'm just thinking we're really relying up to date on this. Yeah.

SPEAKER_01 46:17

Kurtwell did.

SPEAKER_02 46:19

I know, you know, exactly. And so we'll we'll see if he's right. And we're some of us will live long enough to see if he's right, at least. So yeah, but so but but are you saying um like specific AI companies, like company or say the LLM companies, that you don't see what the sort of revenue model is on that? Or the because of course AI, the effects of that and other types of AI technology will affect the business climate sort of generically, but that doesn't tell you which companies to invest in.

SPEAKER_00 46:44

Yeah, this is one of the things. It's confusing on in itself. I'm not sure where where I would invest in this. Because there is this weird, and I I don't want to say it's the same thing, but it's almost an Enron-esque type situation where NVIDIA is like the only company making money, they're investing in companies buying their product, but then those companies are losing money, and the only way those companies can buy Nvidia's product is essentially because Nvidia invests in it. I don't know, it sounds like a shell game to me, but it's maybe above my pay grade to the top of that. I mean But i i i I I don't know. That's the thing. I can't if I have a fundamental investment thesis. If I can't understand how it makes money, I don't invest. Yeah.

SPEAKER_02 47:25

So it doesn't mean that it won't make money, but if you don't understand, you don't know how to choose. What if Bernie Madoff tells you that it's five?

SPEAKER_04 47:32

Can you see how it's gonna make money?

SPEAKER_01 47:33

In your view, do you see the I mean I I I do think we should take the CEOs of these companies at their word, right? Like, you know, to go back to the other thing, you know, both Dario and Sam Altman think that uh you know something like 50% of white-collar workers are gonna be put out of work in the next five to ten years. And like that is I I I think that the uh the investment thesis, you know, if I'm uh, you know, MGX or one of these sovereign wealth funds, or if I'm you know Sequoia Capital or what have you, right? Like I'm investing in anthropic and open AI and XAI and Meta. You know, maybe we'll see what if they ever do anything right. Because I think that they're going to automate a huge fraction of knowledge work currently done in the US economy relatively quickly. And like that is how I return capital to my LPs.

SPEAKER_05 48:13

And that they'll get commercial customers who pay because it makes their business more efficient?

SPEAKER_01 48:17

Yes. And and I think and that's where they're seeing most of the revenue right now. I mean, I think Enthropics uh you know annualized run rate something like doubled over the past two months. Um sorry, it went from like uh 10 billion last year um to like 19 billion within the first two months of the state.

SPEAKER_05 48:31

Well and now it's a way to vote against Trump.

SPEAKER_01 48:33

Libs are all like, I'm signing up for Claude because Trump, what, like $110 billion uh in in in in in in investment. That's that's a crazy amount of money, right? Like that is so again, like I'm skepticism.

SPEAKER_00 48:47

Yeah, that's what I think in the corporate world. Like for our organization, AI probably makes sense. I haven't figured out exactly how to purchase it yet for our organization. But it's like, yes, it probably makes sense. We've got a ton of data going back on conservative stuff going back 70 years. I mean, that's how old we are, right? So if I could have something really look at that, it would be great. And it's uh I'm sure there's treasure of knowledge, you know, sitting right inside our servers. ISIGPT. ISIGPT, yes. So, you know like in the corporate world, I but the investment writ large across the entire population so that some sophomore at the University of Maryland can like hit a button and write a term paper on Karl Marx. Yeah, I don't I don't exactly see how that works. Maybe that's the part of it, the consumer side of this thing. I worry about everything Jay says about it, that's the how it's gonna might impact our, if you will, culture. But like I just don't see how I make money there. And I'm not the only person, so it's like I get in the room of people and kind of shakes back to the city.

SPEAKER_02 49:47

You're not arguing that this is not actually gonna create value in the economy, it's just that it's so unknown. Like like your example of the the dot-com boom and bust, it's not like uh websites went away, right? Or companies you know got rid of their websites. I just I remember the moment I was living in Seattle from 1998 till 2005. So I sort of watched it happen, right? Everyone wanted in on it, but we no one actually understood why. Like every company needed to have a URL and website. None knew why they were doing it initially. And so there was just a lot of that hype. The money sort of floods to it. A bunch of you know, companies went from zero to a hundred and back to zero. Amazon did great, though, right?

SPEAKER_00 50:25

So I mean I don't know if there's an economic historian at the table here right now. But like, if I understand it correctly, right, every new technology, trains, automobiles, um, communications, the first people actually tend to be the losers. Yes. There's a lot of heavy investment, up fun. All those people basically lose out. Because like Amazon essentially was two really different companies in some ways. There was the pre-dot com bubble, Amazon, and then there's the Amazon that we all know, right? And it just happens to be the same name. Right? But there was so I was working in Tyson's Corner with tech companies. We had a company that basically was the i f iPod music thing before Apple did it. It come it weighs 90 million in a public offering, and we had to go to the SEC to figure out how to shut it down because it couldn't make any money. But it was basically it was called musicmaker.com. I mean, I literally remember the name, but it was like your iPod before there was the iPod. Or MySpace before Facebook. MySpace was so it's like I feel like we're at this point in the AI situation where there's there's the only adopter, not maybe that's the long term for it, only investors, if you will, about to lose a bunch of money because on the business side, we're still trying to figure out how to actually make money doing it.

SPEAKER_05 51:40

This is a beautiful argument for like how free enterprise is conservative, right? Because it's it's based on no no individual actually knows stuff. And the people who are losing money are the people who put up the money. And so you have the you know the the the insight about like avoiding the fatal conceit, and also like it doesn't harm me that all these people invested in these companies and lost.

SPEAKER_02 52:04

It's a it's this complicated discovery process that uh we can have a sense ahead of time of the sort of general uh picture. I mean, I'm absolutely convinced that these technologies, unless we do something really catastrophic, will vastly increase the sort of overall size, say, of the global economy. But exactly where and when and what the costs are, that's just that's that's super complicated. That's why you want a discovery process and not you know either someone in the private or the public sector getting to deserve the other.

SPEAKER_05 52:31

NVIDIA, the the flood of money to NVIDIA is because people said, I don't know which of these companies, Anthropic or or Google or Microsoft, is going to do it right, but no matter what they're paying NVIDIA. But you're you're skeptical of of that bet that NVIDIA is somehow the the easiest.

SPEAKER_02 52:46

He's looking at that 4.8 trillion and thinking maybe that's a little high. Yeah.

SPEAKER_00 52:51

Yeah. I mean there's this the the definition of essentially lowering your returns is if the value goes up, the returns have to go down. There's just an inverse relationship with these things. So as that value keeps climbing, not to be like too geekish or investment banking type sense. The multiple on the earnings keeps going up, the value of the company has a multiple of its earnings keeps going up, the returns are going down by definition. So mathematical certainty.

SPEAKER_04 53:17

Max, in these kind of uh debates we were talking earlier about sort of industrial policy, um what is the rule? Obviously, deregulation, you know, more hands-off approach is good kind of in the sector you're involved in, but what is the do you see any role for industrial policy or not? Do you think it's always to, you know, it's sort of Tim's point, it sort of always ends up uh I don't know. You're you're basically just transferring risk uh from the investors to government.

SPEAKER_01 53:46

I mean, I think like the the perverse incentives around industrial policy are well known. Um and I think the the the way to justify it, or at least the um, you know, where we might be willing to risk those perverse incentives for another good reason is around areas of national security, right? Like I think it's you know, actually, I think it's good that uh we want to sort of like hedge our risk on Taiwan and we want to reshore a lot of uh you know semiconductor manufacturing capacity in the US. I also think that like you know, uh Patrick McGee has a great book, Apple in China. Um you know, we can see a lot of uh American companies have systematically trained, uh, you know, Apple being preeminent, but uh many other companies have you know invested a huge amount of time and money and energy in uh training our chief geopolitical rival how to uh build the technologies that will power the future in one way or the other. And again, you know, from a pure free marketer perspective, that's that's great. I mean, like, you know, they have cheap labor, they don't have uh, you know, the same kind of permitting regime that California does. And so, you know, like look, uh, you know, Shenzhen's a very attractive value proposition to make my iPhone. Um but when we look at the larger geopolitical landscape and you know an increasingly multipolar world in a in an era of geopolitical competition, um, you know, and the fact that like the US just increasingly struggles to build things at scale. Um, you know, and we look at you know, the thing that you know Tim has written so elegantly about, about the hollowing out of a lot of our communities as a lot of these manufacturing jobs fled, you know, whether to China or to Mexico or to the rest of the world. Um I think we can we can also see the costs of uh sort of you know blindly following the free market ideology to its logical conclusion here. Um now again, I think there's a lot of nuance here, and I think you know Tim is entirely right to point to the the perverse incentives around a lot of these uh you know sort of industrial policy plays. But I think there are good reasons for you know America's national interest to seriously consider them in areas of concern around national security, around frontier technologies, around uh you know manufacturing capacity that's important in times of geopolitical strife.

SPEAKER_07 55:39

Aaron Powell I mean, you know, at the threshold level, your industrial policy at the starting point at least could just be it is our policy to have industry.

SPEAKER_06 55:49

Right?

SPEAKER_07 55:50

And and you know that has now become a real question in American politics. Do we do we really want to have industry?

SPEAKER_05 55:58

And I and I Well, so I mean on the the national security stuff, I just think I think it was ISI that I entered the the essay contest on Henry Hazlitt's book, and where he argu he goes through all the arguments against free enterprise and he takes them down. But on on the point of national defense, the the idea he put in my head was sort of well this is a cost. Like this makes us a little poorer, but it makes us safe. And frankly, war is always a cost, right? I mean, some people think war is is good for the economy, all that stuff is idiotic. War costs money. It's bad. And sometimes we have to do it because there's bad guys over there.

SPEAKER_01 56:35

But it is costing. Well, right.

SPEAKER_05 56:37

Trevor Burrus, Jr.: But so then the the the the next question that's been raised in in the Trump era, and you know, after David Autor's studies about the China shock and again in places like Western PA, where it's like they didn't just move into the factory workers' sons aren't just doing service sector jobs that uh pay slightly less and are compensated by cheaper goods because they're made in China. These towns collapsed. People died of drug overdoses in massive numbers. Uh Catholic parishes closed, you know. Um things went really bad because and Otor's phrase was something along the lines of mobility responses to uh uh employment shocks are not perfect. Which is a great economist way of putting it. Exactly. The people can't just immediately change careers. We're not homoeconomicists. So the the the arg the intellectual argument in the Trump era has been we need industry not just so that if China pulls a plug we we still have it, but that actually that that cost that we should spend pay to be safer, maybe we should also pay to keep the Monongahila Valley from becoming overrun with Met. Trevor Burrus, Jr.

SPEAKER_02 57:45

Well then I think that's this is actually the key problem that we need to solve, because on the one hand, I think it would be deeply mistaken to say, okay, this particular way that these people were working should somehow be frozen in amber. I mean, I imagine if we had done that with the eight-track tape player factories, which I assume existed somewhere, right, at some point, we'd just be talking about the.

SPEAKER_05 58:05

By the way, I think you're the only one here who had an A-track.

SPEAKER_02 58:07

Well, that's right. Look at this guy over here. I actually do have some A-tracks. It's like them on eBay. For all sorts of obvious reasons, first of all, it wouldn't be dignified. Imagine if we were sort of underwriting those eight-track tape player factories, which is by, you know, for people that the the young'uns, uh, this is a bit sort of bad technology. That would be undignified work because they're not creating value, right? They might be becoming sort of uh uh getting getting fancy.

SPEAKER_07 58:32

That's the only truly dead format, by the way, because they still make cassettes, they still make final records, they still make CDs.

SPEAKER_02 58:39

It was just terrible, you know, and so it really, I mean, from a real real taste. Yeah, from a consumer uh perspective, it makes sense. It was at best a transition technology. Um, and so it's sort of easier if you use an example like that to realize, and that would be a dumb policy to sort of preserve that. Uh and I think it would also be equally dumb to say, okay, we need to preserve precisely the type of manufacturing we had in 1950, which really was this kind of an artifact, a kind of moment uh in time, in which lots of people in, you know, uh uh uh assembly line manufacturer in which a person is literally doing kind of the work of what you'd think of as a machine. Like the same thing over and over. Right? It's not that we want to preserve that. We want to preserve a society in which the ability to work and create value for people in different stages of life at different levels of education, where people can do that, right? So that's the thing uh that we should have to be able to do that.

SPEAKER_05 59:29

But also there's a reliability to it. Like that you could you you could be confident you were going to do it for 30 years. And I know that as a as a conservative guy who believes in free market, you want there to be dynamism, but as a guy who wants people to get married and have kids, you don't want them to be like, well, for now, I have this job that makes money. Next month, will I be able to afford four kids? Maybe not. So the reliability of that post-war ultimately, who is an economy for?

SPEAKER_07 59:55

I mean, I think that's a really fundamental question. Now, that doesn't mean that there aren't certain mathematical realities that exist in any type of economy that you could try to develop. But ultimately, the economy is for the human beings within a certain shared political community. Trevor Burrus, Jr.

SPEAKER_05 1:00:13

And I mean, but I think I'm gonna basically agree with what Jay was saying. I just have zero confidence in the ability of the government at any level to preserve the good things that we want to preserve. Trevor Burrus, Jr.

SPEAKER_02 1:00:24

And that's why I think I wish that we would spend more of our time thinking about the sort of hard problem. So let let's take the let's take the factory worker, a male that's 50 years old, or the long-haul trucker, right? Which actually we're already there technologically for automating that. It's just that I think regulations sort of prevent it. That's a massive job for a segment of the American public. And if I've been a long-haul trucker for 35 years, I've invested in my truck, I didn't go to college, maybe I dropped out of high school, um, it's not obvious what you're gonna do anymore. Learn to code? Oh, wait now. No, that's not gonna work either, right? That would have worked a couple of years ago. And so that's to me, this is the actual problem that we have to solve. Is it's really it's this question of disruption and the play between sort of the dynamic dynamism we kind of want, but we also want uh stability. But I mean, if you think about it, at least like English surnames, Miller, Smith, you go down the line. What does that represent? It represents a time in which certain skilled trades were passed generationally from father to son to grandson, right? Um there are gonna be no surnames like uh, you know, Webmaster. I'm assuming that's no Mr. Webmaster, no, no prompt engineer, right? I mean, those are gonna be talking about them in five years from now, it'll it will age you if you use the term. I mean, that's just kind of the reality of the situation we're in.

SPEAKER_04 1:01:43

Aaron Powell Jim, how do you think of this, the uh kind of the political coalition between kind of the tech right and the you know the Republican Party and uh as you look into the future?

SPEAKER_07 1:01:54

Trevor Burrus Well, and it it it obviously Vice President J.D. Vance is a very interesting figure in in all of this because he is very much a part of the tech right. Uh but he is also maybe a more philosophically committed populist uh than as I think is And a social conservative. And a social conservative, uh to a greater degree on both of those fronts, social conservative and and populist, than I think the president himself is, and has tried to sort of one attach some policy meat to the populist bone, and two to kind of have an uh an overarching uh political philosophy that is uh a little more uh developed than you know just jobs for the lads. So, you know, i i again I think it it it highlights this sort of tension that has always existed, or at least from from Reagan on has existed in the Republican Party, has really accelerated under Trump, and I think is going to continue to be a real tension if if in fact the baton is is is past advance, um, of of how the party of economic dynamism and a party that is still heavily funded by the mo some of the most dynamic uh parts of the business community, yet is increasingly reliant electorally on working class people and whose whole model for being able to win, at least at the presidential level, has been attracting working class people from the battleground states that have seen a certain amount of deindustrialization, the Rust Belt states. Now, the changes in the census, uh, you know, maybe the Rust Belt states cease to be the swing states and then that shifts back to the Sunbelt, where maybe a more dynamic vision of the Republican Party could be the future there, or maybe the Sunbelt ultimately ends up having the same kinds of problems, albeit somewhat differently, than ultimately face the Rust Belt. But it's it's a real tension that's that exists i in the Republican Party and that at some point is gonna have to be uh grappled with by the conservative movement. And the conservative movement, I think, has really remained frozen in time of the of 40 years ago uh and and trying to solve a lot of the problems uh that were serious problems in 1981. Now, fortunately for the conservative movement, there are a lot of people in national politics that are trying to recreate the problems that we had in 1981. So maybe it'll all just work out fine. Um, you know, stagflation and and and all of those things, uh conflict with Russia, uh you know, but the the tech right. Beating the Reds in hockey is another 1981. Seriously. USA. The ascendancy of the tech right at a time when the uh the growth segment in the Republican Party on at the voter level are people who would, at least on paper, be afraid of the tech right, is a really interesting and challenging dynamic. Trevor Burrus, Jr.

SPEAKER_05 1:05:27

Well, I think part of the tech right that we have to be interested in again is to talk about sort of anthropology and what these people think life and the humans are. And so you I somebody once said as in a free market circle, and somebody said, we need to do what it takes to get more Jeff Bezos's and more Elon Musks. And I was thinking, no, I think we have the right number of each one. Like you want you want one. You don't want any more. And so you want these people running these companies, with Sam Altman, uh the but I d I don't think that they have wisdom about what people are. And so if they if they take over a political movement, we want them to say, hey, by the way, we need some running room, uh we need uh so that we can innovate and we don't know what's next. Great. But if they have and I don't know, worldview I don't know.

SPEAKER_07 1:06:19

Maybe you guys are fancy.humanist social conservatives like that.

SPEAKER_02 1:06:22

No, we need to find those or grow them up. But I mean Musk is a good example. I treat him as always a kind of work in progress because this changes views change over time. But he and Kurzweil both believe that human labor itself is going to get replaced. They both sort of think that's a good thing, right? And and Musk in particular thinks that's going to free us up, right? So okay, we'll just give everybody universal basic income or something like that. That's a flawed view in my perspective from my perspective of work itself, that work is just a bad that we would always replace if we could. That sounds extremely dystopian to me this idea that humans are going to, I don't know, just the worst form of leisure, like the humans in Wally up in that ship just floating around, you know, on on uh gravity-free uh barco loungers or something like that. That is deeply disturbing. I don't believe that that picture has to uh to to actually uh uh come to pass but we do need to think about okay what are the types of work that are going to give dignity by which I mean uh value creating work. That's what makes almost any kind of work uh uh uh dignifying is that you're creating value for yourself and for other people.

SPEAKER_07 1:07:32

I think even the narrow case of COVID-19 illustrates the the value of work. And not only did we see during the lockdowns a lot of jobs destroyed or at least interrupted, but we also saw a lot of people who kept their jobs and kept their incomes working from home and the distinction between leisure and work was sort of eroded. It was clearly not good for people's mental health to be sitting at home alone all day looking at the internet and imagining what other people were planning to do to them that would be bad that these other people don't even know they exist and are not planning to do any bad things to it was very clearly an unhealthy episode in American life and to want to build that out at a at a a larger scale I just is un unfathomable to me.

SPEAKER_01 1:08:23

There's an interesting like historical way to look at Silicon Valley's emergence in American politics here too which is that you the first folks to really build here were folks who are closely tied into the you know military industrial complex. And they're largely Republicans who moved out from the Midwest and set up shop in the sort of the the frontier country of California and started building in the physical world right like Silicon Valley was literally silicon it's semiconductors it's chips it's uh it's a domestic industry right you know it's it's the Apple computer being assembled in a garage. And so there's there's always been a strong conservative coalition uh there within Silicon Valley right I mean David Packard was uh Nixon's I think assistant secretary for defense if I recall correctly um you know and and I think there there was a a sort of like really honest connection to the work there. Now I think since uh you know with as educational polarization has has driven and as sort of these other ideologies that we're talking about transhumanism, effective altruism, um you know sort of like sease libertarianism, right? You know, to uh you know the the I think that that has complicated the picture quite a bit. You know, I mean we we look at you know 2018 when uh Google was trying to work for the Department of Defense at the time and uh you know their employees staged a walkout and Google actually lost the contract. I think it went to Amazon or Microsoft. And uh you know I I so I do think that the sort of the the boom in you know defense tech and uh the boom of in what use Peter Thiel's distinction of building in uh atoms not just in bits um does also necessitate like a more a more like complex political story to tell in in Silicon Valley, right? It's not just gonna be the sort of like uh center left folks who uh you know feel right at home in the Obama coalition. It's also gonna be folks who are good at working with their hands, folks who understand how to build factories and who understand to your point, Jay, how to build factories of the future, right? Like you know we're not gonna be we're not gonna be building the same kind of manufacturing economy that we had 50 years ago. But I do think a big part of the American story going forward is going to be a manufacturing story and you know how AI plays into this, how robotics plays into this is going to be you know create a lot of open questions. But I think it's also going to be uh complicate the sort of the the the tech right story.

SPEAKER_03 1:10:25

We're about out of time. Tim any last word to bring us down?

SPEAKER_05 1:10:30

No I mean I think I think about what conservatism brings to this moment. And one is humility. We don't know where AI is going to go. And another is as Jim was saying sort of like GDP economics these are incredibly important tools, incredibly important means to an end. But if if at any point in this pursuit we lose track of the fact that we are sort of um embodied that we are bodies and souls that we are relational that we are uh that we're we're fallen and imperfect but ultimately good if we lose track of all those things we're gonna we're gonna steer off course.

SPEAKER_04 1:11:08

Thank you for watching Project Cosmos Conversations on the Future of Civilization, which is a production of ISI, the Intercollegiate Studies Institute. If you're a student, professor, or lifelong learner who wants to get more involved with ISI, visit ISI.org or follow us on social media to learn more about our educational programs that teach the foundations of Western and American civilization and what it means to be a great and good man or woman today. That's ISI.org or like and follow us on social media. Thank you.