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Trump Returns to Trail in North Carolina With Senate in Play · Balance of Power

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  Speaker 1: Bloomberg Audio Studios. Podcasts.
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  Speaker 2: Radio.
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  Speaker 3: News.
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  Speaker 4: You're listening to the Bloomberg Balance of Power podcast. Catch
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  Speaker 4: Listen on demand wherever you get your podcasts or watch
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  Speaker 4: us live on YouTube.
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  Speaker 5: Yesterday that sent stocks down and bond yields up. We're,
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  Speaker 5: of course, seeing the reverse today, as Charlie outlined beautifully
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  Speaker 5: for us. Of course, that is just digesting the hike
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  Speaker 5: of yesterday. The Fed, of course, in the dot plot,
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  Speaker 5: did pencil in another one for this year, whether that
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  Speaker 5: comes at the meeting in October or December, whether it
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  Speaker 5: comes at all, I guess, is an open question. And
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  Speaker 5: maybe President Trump wouldn't be as willing to take a
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  Speaker 5: second look hike in a hiking cycle with as much
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  Speaker 5: grace as he appeared to yesterday, suggesting that actually Kevin
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  Speaker 5: Warsh didn't defy him. He gave him permission to vote
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  Speaker 5: for this along with the rest of the FOMC. And
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  Speaker 5: what was, of course, a unanimous decision. Listen to the
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  Speaker 5: president on route to North Carolina yesterday.
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  Speaker 6: Interest rates are too high.
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  Speaker 3: They're not appropriate.
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  Speaker 7: I talked to Kevin and I said, you might as
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  Speaker 7: well vote with the board because it's not going to matter.
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  Speaker 1: The board is very hostile.
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  Speaker 8: They're very political.
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  Speaker 9: They're doing the wrong thing. They're a bunch of politicians.
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  Speaker 8: We should be paying the lowest interest rate anywhere.
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  Speaker 10: In the world.
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  Speaker 8: I refer, of course, to Donald Trump's Post on Truth
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  Speaker 8: Social before he made those comments, in all caps, lower
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  Speaker 8: the interest rates for the United States of America and
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  Speaker 8: fast exclamation point. He did not apparently say that to
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  Speaker 8: Kevin Warsh when they spoke. And we should note, by
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  Speaker 8: the way, that we do not have evidence of that
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  Speaker 8: conversation beyond what the president said. Kevin Warsh wouldn't detail
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  Speaker 8: his interactions with the president in the news conference yesterday.
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  Speaker 8: Let's get to Tyler Kendall right now. We have a
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  Speaker 8: lot to cover. with our Washington correspondent who stands on
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  Speaker 8: the North Lawn of the White House as we speak. Tyler,
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  Speaker 8: we're not expected to see or hear from the president
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  Speaker 8: today unless you can tell me about any updates. But
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  Speaker 8: is this the message from the White House now that
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  Speaker 8: Kevin Warsh has the president's permission to hike rates?
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  Speaker 10: Well, Joe, it seemed like President Trump was standing by
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  Speaker 10: his Fed chair saying, as you heard, that he told
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  Speaker 10: him that he should go along with the FOMC, alleging
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  Speaker 10: that policymakers are politically motivated against him, even as we
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  Speaker 10: repeatedly hear from the Fed chair himself that the board
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  Speaker 10: is focused on the economic fundamentals. That includes how geopolitical
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  Speaker 10: risks are contributing to inflation. We did have some new
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  Speaker 10: reporting earlier today from Axios in terms of the president saying.
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  Speaker 5: That when it comes to the conflict in the Middle.
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  Speaker 10: East, he's going to have a big decision to make
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  Speaker 10: pretty soon. Last night, he did touch on the conflict
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  Speaker 10: in his remarks to voters in North Carolina, but it
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  Speaker 10: didn't really seem like we were getting closer to a
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  Speaker 10: diplomatic resolution. Instead, saying that he's not sure Iran is
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  Speaker 10: ready to come to the negotiating table before the midterm elections.
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  Speaker 10: To the point that you mentioned before, Kevin Warsh was
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  Speaker 10: asked directly about any discussions with President Trump. He didn't
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  Speaker 10: detail any discussions that he has or hasn't had, but
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  Speaker 10: he did say that the economy appears to be strengthening.
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  Speaker 10: And he characterized what he called an attitude of optimism
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  Speaker 10: on the FOMC, even as this White House has been
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  Speaker 10: trying to navigate a political message around the economy as
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  Speaker 10: Republicans keep playing defense when it comes to voter dissatisfaction
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  Speaker 10: with higher prices.
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  Speaker 1: Joe and Kayleigh.
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  Speaker 5: Well, and of course, it's not just higher oil prices
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  Speaker 5: stemming from the conflict in the Middle East. There's also
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  Speaker 5: the effect of tariffs, especially in light of the still
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  Speaker 5: unresolved trade war between the U.S. and Canada that, of course,
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  Speaker 5: has drawn Canada closer to the EU, which has offered
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  Speaker 5: an associate membership this week. Tyler, the president is now
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  Speaker 5: threatening to hit the EU with greater tariffs and perhaps
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  Speaker 5: cut off some trade if he deems that to be
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  Speaker 5: a hostile act. What can you tell us about that?
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  Speaker 10: So we didn't get further details beyond that, Kayleigh, including
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  Speaker 10: what would be the benchmark for the president to follow
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  Speaker 10: through on this threat, nor what authority the White House
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  Speaker 10: would use. One potential option on the table is Section 338,
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  Speaker 10: which means that the U.S. could lobby levies if they're
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  Speaker 10: tied to allegations of discriminatory trade practices. We should give
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  Speaker 10: greater context here that the EU already faces significant tariffs
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  Speaker 10: from the U.S., ranging anywhere from 10 to 50 percent.
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  Speaker 10: for some of those sector-specific tariffs, such as on metals.
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  Speaker 5: We did hear from the E.U.
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  Speaker 10: Defending this proposal to have an associate member of the
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  Speaker 10: bloc in Canada, the E.U. Commission spokesperson, putting out a
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  Speaker 10: statement saying that, quote, the proposed strengthening of our partnership
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  Speaker 10: with Canada is not against anyone else.
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  Speaker 5: Now, that's on the E.U.
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  Speaker 10: Side, but as you already alluded to, we know that
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  Speaker 10: Canada has been working to diversify its economy away from
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  Speaker 10: the U.S. amid what has been these ongoing tensions. It's
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  Speaker 10: Pretty incredible to think that less than a month ago,
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  Speaker 10: it felt like we were on the brink of a
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  Speaker 10: trade deal with Canada. President Trump had said that it
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  Speaker 10: all was done. They were just trying to firm up
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  Speaker 10: those final details. But of course, those talks ended up
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  Speaker 10: falling apart.
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  Speaker 5: All right, Tyler Kendall live at the White House for
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  Speaker 5: us on the latest tariff threats and, of course, the
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  Speaker 5: president's trip to North Carolina yesterday. Tyler, thank you so much.
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  Speaker 5: And as we consider the president's efforts to boost Michael
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  Speaker 5: Watley in the Senate race in North Carolina and the
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  Speaker 5: Senate picture across the map, we turn now to Jessica Taylor,
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  Speaker 5: who is the Senate and governor's editor with The Cook
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  Speaker 5: Political Report and is back with us on Bloomberg TV
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  Speaker 5: and radio. Jessica, great to have you, as always. And
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  Speaker 5: there's a lot we want to get to. If I
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  Speaker 5: could just ask you first, though, as the president made
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  Speaker 5: tracks to North Carolina yesterday, Is there anything he can
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  Speaker 5: do realistically to give Michael Watley a better chance in
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  Speaker 5: this race at this point, including perhaps throwing more money
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  Speaker 5: at the race?
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  Speaker 11: More money would certainly help. I mean, Republicans are outspending
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  Speaker 11: Democrats right now. But when you look at the gross
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  Speaker 11: ratings points, the number of times the ads are actually airing,
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  Speaker 11: Democrats still have an advantage there. But I think that
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  Speaker 11: Trump is unpopular in North Carolina. And this is a
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  Speaker 11: state that he carried just two years ago. And certainly
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  Speaker 11: he can help Whatley consolidate the Republican base, and that
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  Speaker 11: will tighten up the race. I don't think any race
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  Speaker 11: in North Carolina is going to be a blowout. But
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  Speaker 11: right now we still see former Governor Roy Cooper as
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  Speaker 11: having the advantage.
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  Speaker 12: We rate this race as lean Democrat.
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  Speaker 8: What's the message right now, Jessica? The president talked a
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  Speaker 8: lot about crime last night. But will Republicans who are
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  Speaker 8: just now getting home to their districts to close the
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  Speaker 8: deal on some of these races– still tell voters that
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  Speaker 8: the war was worth it, that these record high gas prices,
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  Speaker 8: record high diesel prices are worth it because Iran will
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  Speaker 8: never get a nuclear weapon? Or has that talking point evolved?
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  Speaker 11: I think that if that's the president's talking point, I
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  Speaker 11: am highly skeptical it's one that's going to be successful
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  Speaker 11: because this is in real time. People are feeling the
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  Speaker 11: gas prices. In competitive states like Iowa, they are feeling
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  Speaker 11: the fertilizer and diesel prices.
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  Speaker 12: They're feeling diesel prices.
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  Speaker 11: In Alaska, there was a poll that just came out
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  Speaker 11: that shows Mary Peltola continuing to opening up a wider
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  Speaker 11: lead there, a bipartisan poll, including from one pollster that
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  Speaker 11: is Trump's pollster. So, you know, it's the economy that
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  Speaker 11: is overshadowing everything, including crime. including culture war issues. I
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  Speaker 11: think it all just comes down to economics for this.
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  Speaker 11: And a lot of voters are going to say, the
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  Speaker 11: war is not helping me feed my family. The war
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  Speaker 11: is not helping me fill up my gas tank.
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  Speaker 5: Well, so if that's true in a lot of these
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  Speaker 5: Senate battlegrounds, what makes New Hampshire different, Jessica, that inspired
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  Speaker 5: you to switch it from Leans Democrat to toss up
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  Speaker 5: this week? Is it simply the strength of the Sununu
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  Speaker 5: name and the Republican nominee, John Sununu?
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  Speaker 11: Yeah, the Sununu name is helping Republicans there in New
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  Speaker 11: Hampshire is a famously independent state. They have a Republican governor,
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  Speaker 11: Kelly Ayotte, that's also running very strongly. And so sometimes
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  Speaker 11: they split their tickets. I do think the money right now,
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  Speaker 11: Republicans are heavily outspending Democrats on the airwaves. I think
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  Speaker 11: that it's Democrats or Chris Pappas' campaign is arguing, you know,
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  Speaker 11: this needs, we can't cede this seat. The money needs
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  Speaker 11: to be here, even as they're looking to expand the
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  Speaker 11: map in other places. So I do think that if
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  Speaker 11: the money parity evens out a little bit, again, if
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  Speaker 11: this is a race about Trump, as we see in
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  Speaker 11: other states, then Chris Pappas should win this race. But
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  Speaker 11: if it comes down to candidate versus candidate, I think
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  Speaker 11: that the Sununu name is helping there. So, you know,
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  Speaker 11: we certainly, this race could certainly shift back in Democrats'
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  Speaker 11: direction once we see spending over the next couple of weeks.
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  Speaker 9: Well, talk about the map for just a moment.
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  Speaker 8: If Democrats lose New Hampshire, Jessica, what do they need
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  Speaker 8: to make up.
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  Speaker 9: To be able to win the Senate?
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  Speaker 11: I think Democrats should be worried more about Michigan than
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  Speaker 11: New Hampshire, even though both are in the toss-up column.
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  Speaker 12: I think Michigan is a bigger headache for them right now.
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  Speaker 11: With Abdul Al-Sayed, we're seeing him running behind the Democratic
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  Speaker 11: baseline in a new Washington Post poll that was out today. But,
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  Speaker 11: you know, they've got to flip North Carolina. That's their
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  Speaker 11: number one seat. They need to flip Maine. You know, again...
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  Speaker 11: Both parties feel like this is just a margin of
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  Speaker 11: error race. But again, the fact that they are going
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  Speaker 11: to have to go and even to win the majority,
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  Speaker 11: they have to win at least two states that Trump
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  Speaker 11: won by double digits if they lose New Hampshire and
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  Speaker 11: lose Michigan, I have a hard time seeing how they
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  Speaker 11: get to the majority. They would need to flip four
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  Speaker 11: seats that Trump won by double digits. It could be
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  Speaker 11: done in a very unusual year, but we typically see
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  Speaker 11: more of these races breaking in one direction than the other.
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  Speaker 11: Right now, all these polls are just very, very close.
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  Speaker 11: But remember that we're not that far post-Labor Day. The
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  Speaker 11: traditional starting gate for the campaign season is less than
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  Speaker 11: seven weeks out now from Election Day. People are starting
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  Speaker 11: to tune in. So I expect some of these poll
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  Speaker 11: numbers to start moving. The money is certainly moving.
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  Speaker 12: MAGA Inc. is spending a lot.
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  Speaker 11: That's where Democrats are raising the alarm that for the
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  Speaker 11: first time they might get outspent by Republicans.
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  Speaker 5: If we could spend a minute longer on Michigan. Jessica,
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  Speaker 5: I wonder what influence you think Kamala Harris may have
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  Speaker 5: as she's getting set to campaign with Abdul El-Sayed in
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  Speaker 5: Michigan next week. Knowing El-Sayed, while he did narrowly win
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  Speaker 5: the Democratic primary, he struggled in some critical demographic groups,
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  Speaker 5: including Jewish voters and Black voters. And I wonder if
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  Speaker 5: Kamala Harris is able to help him solve that issue
• 10:20
  Speaker 5: or if she risks alienating others. She's not exactly a
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  Speaker 5: universally loved figure in Democratic politics at the moment. And
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  Speaker 5: there's plenty of candidates who have tried to create distance
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  Speaker 5: from her. She isn't.
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  Speaker 11: But I think if you're seeing the numbers and where
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  Speaker 11: I am is that he is weak with black voters
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  Speaker 11: still in and around Detroit. That's where Haley Stevens, his
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  Speaker 11: primary opponent, ran much stronger in You know, he runs
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  Speaker 11: better with younger voters, but I think that if he
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  Speaker 11: can sort of make some inroads with the black community
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  Speaker 11: that could help close that gap. We see Jocelyn Benson
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  Speaker 11: leading comfortably in the governor's race again when asked whether
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  Speaker 11: they would prefer a Democratic senator or a Republican Senate.
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  Speaker 11: It still comes down to being a Democratic Senate. So
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  Speaker 11: she could help him shore up some of that African-American
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  Speaker 11: base in and around Detroit in particular.
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  Speaker 8: Yeah, Benson has a 12 percentage point lead. And you've
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  Speaker 8: got El Sayed, who is a national name because of
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  Speaker 8: the interest in this race in the margin of error.
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  Speaker 8: This is a pretty interesting moment here. Would the numbers
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  Speaker 8: look very different if Haley Stevens had won this primary?
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  Speaker 11: I think it probably would have. She was a more
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  Speaker 11: moderate candidate. You know, maybe she might not have energized
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  Speaker 11: younger voters more, but she wasn't going to sort of
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  Speaker 11: alienate independents that I think in the way that El-Sayed has.
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  Speaker 11: They're looking at sort of the return of the security
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  Speaker 11: moms almost. You see the ads, especially around the 9-11 anniversary,
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  Speaker 11: hitting El-Sayed. I mean, Republicans are not being coy about
• 11:45
  Speaker 11: the fact that he is a Muslim, alleging ties.
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  Speaker 12: And then Hassan Piker, the controversial streamer who.
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  Speaker 11: Has said things about 9-11, his association with him is
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  Speaker 11: not helping as well. Haley Stevens didn't have that baggage.
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  Speaker 11: That's why National Democrats preferred her in this primary and
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  Speaker 11: spent millions and millions of dollars to try to get
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  Speaker 11: her as the nominee instead of El-Sayed.
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  Speaker 5: Jessica, I'd like to ask you as well about a
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  Speaker 5: new Texas poll we got, the Texas poll that's done
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  Speaker 5: in conjunction with Siena that finds James Tallarico leading Ken
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  Speaker 5: Paxton by six points. So up two points from the
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  Speaker 5: most recent poll in July. And Gina Hinojosa actually leading
• 12:22
  Speaker 5: Abbott by four points. Previously, Abbott in the July poll
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  Speaker 5: was up about one point. I wonder how you interpret
• 12:30
  Speaker 5: these results and whether or not the fate of both
• 12:33
  Speaker 5: Hinojosa and Tallarico are dependent on one another. Is it
• 12:37
  Speaker 5: likely that we see a lot of ticket splitting in
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  Speaker 5: Texas today?
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  Speaker 11: I think we will see some ticket splitting. I still
• 12:43
  Speaker 11: think that the Texas Senate race is far likelier to
• 12:45
  Speaker 11: flip than the governor's race. We typically see Canada is
• 12:48
  Speaker 11: willing to split their vote when it comes to governor.
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  Speaker 11: Abbott is outspending Gina Hinojosa by a 20 to 1
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  Speaker 11: margin last I checked. So I think that governor's race
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  Speaker 11: is harder, though it is certainly worth watching.
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  Speaker 12: There is a lot of movement that we.
• 13:01
  Speaker 11: Are seeing even in our own polling here at the
• 13:03
  Speaker 11: Cook Political Report that we did last week in Texas
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  Speaker 11: with Univision, that a significant number of Trump voters, Hispanic
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  Speaker 11: Trump voters are breaking and are voting for Tallarico. Some
• 13:15
  Speaker 11: are also breaking and voting for Hinojosa, but not as much.
• 13:18
  Speaker 11: So I think Tallarico's strength certainly helps there. This is
• 13:20
  Speaker 11: where we are seeing national Republicans pouring $ 60.
• 13:23
  Speaker 12: Million or more.
• 13:25
  Speaker 11: I talked with someone today that thinks that ultimately the
• 13:27
  Speaker 11: Senate race is going to, Republicans are going to have
• 13:29
  Speaker 11: to spend $ 250 million as we're talking about sort of
• 13:33
  Speaker 11: candidate quality in Michigan. We have to talk about candidate
• 13:36
  Speaker 11: quality also in Texas because this would not have been
• 13:39
  Speaker 11: as competitive of a race if Republicans had nominated John
• 13:43
  Speaker 11: Cornyn instead of Ken Paxton.
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  Speaker 9: Does anything.
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  Speaker 8: Jessica, that took place in the last couple of days
• 13:49
  Speaker 8: here in Washington Matter on the campaign trail. We saw
• 13:52
  Speaker 8: an overwhelming bipartisan support for a data center bill to
• 13:55
  Speaker 8: protect people's electricity bills. We saw a pretty convincing vote
• 13:59
  Speaker 8: on Russia sanctions as well. Are these part of the
• 14:02
  Speaker 8: messaging for candidates at home, or is this for us
• 14:04
  Speaker 8: in Washington?
• 14:06
  Speaker 11: I think we can see data centers, but honestly, I
• 14:08
  Speaker 11: see data centers as more of a cross-partisan issue. It's
• 14:10
  Speaker 11: not I mean, Republicans can certainly point to we're doing
• 14:14
  Speaker 11: things to bring down your electricity and your utility costs
• 14:18
  Speaker 11: and different things. But I think that as long as
• 14:20
  Speaker 11: gas prices are high, as long as the war is ongoing,
• 14:24
  Speaker 11: that is the biggest hindrance for Republicans and for President Trump.
• 14:28
  Speaker 8: Really interesting, Jessica. It's always a pleasure to have you.
• 14:30
  Speaker 8: Jessica Taylor is the best at this. The Senate governor's
• 14:33
  Speaker 8: editor at the great Cook Political Report. We thank you,
• 14:35
  Speaker 8: as always. We're going to be talking to Jessica. We
• 14:37
  Speaker 8: like to think a lot between now and Election Day.
• 14:39
  Speaker 9: Can you believe 47 days?
• 14:41
  Speaker 8: It's kind of amazing to think of how close we're getting.
• 14:43
  Speaker 8: And to Jessica's point, people really are now paying attention.
• 14:46
  Speaker 8: As we're told, decisions are made. Right around Labor Day,
• 14:50
  Speaker 8: with record high diesel prices, it's a quandary for Republicans.
• 14:54
  Speaker 5: Yeah, and Republicans are spending a lot more money, as
• 14:56
  Speaker 5: Jessica was outlining in the New York Times, reporting that
• 14:58
  Speaker 5: MAGA Inc., in a PAC affiliated with it, is deploying
• 15:02
  Speaker 5: $ 138 million now toward Republicans. We were wondering when the
• 15:05
  Speaker 5: money would be spent. It seems that they're starting to
• 15:07
  Speaker 5: do it as we're in the final weeks of these races.
• 15:10
  Speaker 8: Stay with us on Balance of Power. We'll have much
• 15:13
  Speaker 8: more coming up after this.
• 15:17
  Speaker 4: You're listening to the Bloomberg Balance of Power podcast. Catch
• 15:21
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• 15:32
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• 15:34
  Speaker 5: I'm Kaylee Lyons in Washington. Joe Matthew also in Washington.
• 15:39
  Speaker 5: The Senate still in Washington, at least for the next
• 15:42
  Speaker 5: couple of weeks. The House, however, got out of town yesterday. yesterday,
• 15:45
  Speaker 5: took their final votes and packed it up to go
• 15:48
  Speaker 5: home and campaign in the final stretch to the midterm elections,
• 15:51
  Speaker 5: which of course are just 47 days away and they
• 15:53
  Speaker 5: will not be returning. until mid-November, once those elections are
• 15:58
  Speaker 5: over and all of the ballots have been counted, or
• 16:00
  Speaker 5: at least most of them. You never know about how
• 16:02
  Speaker 5: late it's going to go in California. And, of course,
• 16:06
  Speaker 5: that means that the House will not be acting legislatively
• 16:08
  Speaker 5: on any number of outstanding issues, be they related to
• 16:11
  Speaker 5: affordability or getting guardrails around artificial intelligence. But Mike Johnson
• 16:17
  Speaker 5: says that the work is done and there's no reason
• 16:19
  Speaker 5: to stay. This was him at the Capitol yesterday.
• 16:22
  Speaker 6: The House has done its job here. We're on a
• 16:25
  Speaker 6: 48-hour notice to return as necessary. So we're very hopeful
• 16:29
  Speaker 6: that our colleagues in the Senate can send us bills
• 16:32
  Speaker 6: of substance over here so that we can continue to
• 16:34
  Speaker 6: move that along through the process and give bills to
• 16:36
  Speaker 6: the president's desk. So House Republicans are going now back
• 16:38
  Speaker 6: to our districts. We're going to make the case to
• 16:41
  Speaker 6: the American people on what we have delivered on their behalf.
• 16:44
  Speaker 6: The media certainly doesn't do this for us, so we've
• 16:47
  Speaker 6: got to go tell them the truth.
• 16:50
  Speaker 9: We're doing our best on that.
• 16:52
  Speaker 8: And by the way, there is one piece of legislation
• 16:54
  Speaker 8: going to the president's desk, at least, and that's the
• 16:57
  Speaker 8: Russia sanctions bill, or maybe we should call it the
• 16:59
  Speaker 8: Russia tariffs bill. This is the Lindsey Graham named bill
• 17:02
  Speaker 8: that would give the president wide authority to put secondary
• 17:06
  Speaker 8: sanctions or tariffs on countries that buy oil from Russia.
• 17:10
  Speaker 8: 262 to 159, much more overwhelming is the data center bill.
• 17:16
  Speaker 8: And I'd love to hear from our panel members On
• 17:18
  Speaker 8: this as well, the House passing this bill meant to
• 17:21
  Speaker 8: protect consumers from higher electricity bills.
• 17:23
  Speaker 9: We talk about this every day. They actually got something
• 17:25
  Speaker 9: done here.
• 17:25
  Speaker 8: 417 to 3, three Democrats voting against it. But it's
• 17:30
  Speaker 8: not likely to change the picture between now and November,
• 17:33
  Speaker 8: of course.
• 17:33
  Speaker 9: So let's bring them in.
• 17:34
  Speaker 8: Bloomberg, our panel today on Bloomberg is Republican strategist Sarah Chamberlain,
• 17:40
  Speaker 8: Republican Main Street Partnership president and CEO, and Doug Ferrer
• 17:43
  Speaker 8: is with us, Democratic strategist and principal strategist.
• 17:46
  Speaker 9: At Maywood Strategies. Sarah, these are your folks.
• 17:49
  Speaker 8: I don't know if that means we can all park
• 17:52
  Speaker 8: where we want and go out to eat where we
• 17:53
  Speaker 8: want in Washington now. But the Speaker of the House
• 17:57
  Speaker 8: is framing this as the most productive Congress since the.
• 18:01
  Speaker 10: 1700s, I believe.
• 18:02
  Speaker 9: How do we see that being possible?
• 18:04
  Speaker 7: We're somewhere in between. They did get a lot done.
• 18:08
  Speaker 7: I mean, they really have gotten a lot done.
• 18:10
  Speaker 9: And what will they be putting in front of voters
• 18:12
  Speaker 9: now that they're home?
• 18:13
  Speaker 7: So they're really going to continue to talk about no
• 18:16
  Speaker 7: taxes on tips, things that were in the big, beautiful bill,
• 18:19
  Speaker 7: whatever you want to call that, from earlier in the cycle.
• 18:24
  Speaker 7: So they're talking about that. They are going to talk
• 18:27
  Speaker 7: about the bill that you just mentioned.
• 18:30
  Speaker 13: Data centers.
• 18:32
  Speaker 7: are a partisan.
• 18:34
  Speaker 13: I mean, it's a nonpartisan issue right now.
• 18:37
  Speaker 7: And I would argue, as I have before, is that
• 18:40
  Speaker 7: China and Russia is doing a great job putting all
• 18:43
  Speaker 7: this negativity into social media and convincing the American people
• 18:48
  Speaker 7: that data centers are bad. So that's one thing that
• 18:52
  Speaker 7: they're going to go home and run on that because 98%
• 18:53
  Speaker 7: of their districts feel data centers are bad.
• 18:57
  Speaker 10: Wow.
• 18:57
  Speaker 7: I know. They're doing a good job promoting, but the
• 19:00
  Speaker 7: reality is that's really not the truth. As we've talked
• 19:04
  Speaker 7: about before, you can use the same water, you recycle it.
• 19:07
  Speaker 7: The energy, if you're in a small town, they make
• 19:11
  Speaker 7: more energy and they can sell.
• 19:13
  Speaker 13: It back to the town cheaper.
• 19:15
  Speaker 7: And all the money they pump in, I mean, we
• 19:17
  Speaker 7: were having that discussion this morning, rural hospitals, rural schools.
• 19:21
  Speaker 13: I mean, they could really get a big boom off
• 19:24
  Speaker 13: of this.
• 19:24
  Speaker 7: But the American people need to be educated on really
• 19:27
  Speaker 7: what's going on here.
• 19:29
  Speaker 5: Well, so when we think about the American people's perceptions here, Doug,
• 19:33
  Speaker 5: how far does passing a ratepayer protection pledge bill go
• 19:37
  Speaker 5: to assuaging the concerns? Can both sides claim a win here?
• 19:43
  Speaker 1: I think it helps.
• 19:44
  Speaker 3: I mean, obviously, the affordability issue around data center energy
• 19:48
  Speaker 3: use is a major factor. in household bills. But look,
• 19:53
  Speaker 3: I got to disagree with Sarah. This isn't China or Russia.
• 19:56
  Speaker 3: This is Americans looking around, hearing AI companies say, we're
• 20:01
  Speaker 3: creating a product that might kill all humanity. And in
• 20:04
  Speaker 3: the meantime, it'll make sure lots of people lose their jobs.
• 20:07
  Speaker 3: We're stealing a lot of people's information and using it
• 20:09
  Speaker 3: to surveil them. We're being deployed by hospitals to raise
• 20:13
  Speaker 3: people's costs and deny care and a host of other issues.
• 20:17
  Speaker 3: And data centers is their point of rejection. This is
• 20:20
  Speaker 3: where they can stand up and say, you know what?
• 20:22
  Speaker 3: No one's going to do anything about this. I'm not
• 20:24
  Speaker 3: going to stand here and let this be built to
• 20:26
  Speaker 3: further this product that has all these negative consequences on
• 20:29
  Speaker 3: their lives. And I think it's really an interesting lane
• 20:32
  Speaker 3: for Democrats. And you saw people from Barack Obama to
• 20:35
  Speaker 3: Lena Kahn say how important it is that Democrats take
• 20:38
  Speaker 3: this on. because the politics of this are very unanimous
• 20:42
  Speaker 3: against it. And I think the party that's able to
• 20:44
  Speaker 3: muster a real response will benefit tremendously, not only in
• 20:47
  Speaker 3: this upcoming midterm, but potentially into 2028.
• 20:52
  Speaker 8: Should Republicans be in a hurry to try to identify
• 20:55
  Speaker 8: this issue as a Republican one?
• 20:56
  Speaker 9: You made the point, Sarah, this is pretty bipartisan.
• 20:58
  Speaker 8: When you have Steve Bannon and Bernie Sanders on the
• 21:02
  Speaker 8: same stage singing the same tune, I'm not sure that's
• 21:05
  Speaker 8: ever happened or will ever happen again.
• 21:07
  Speaker 7: Probably not. But we have to educate, and that's where
• 21:10
  Speaker 7: I disagree with Doug. If the United States doesn't do it,
• 21:13
  Speaker 7: it is going to get done in Russia or China.
• 21:16
  Speaker 7: AI is not stopping. Yes, they need to come together
• 21:19
  Speaker 7: as the King did. and bring all the CEOs together
• 21:24
  Speaker 7: and really try to put some guardrails around it. But
• 21:26
  Speaker 7: data centers are going to be built somewhere in this
• 21:29
  Speaker 7: world no matter what.
• 21:30
  Speaker 13: Maybe space. Or maybe space.
• 21:32
  Speaker 5: Elon Musk has his way.
• 21:33
  Speaker 6: Right.
• 21:34
  Speaker 7: So we need to educate the American people on the
• 21:36
  Speaker 7: need of data centers. Just because they're not in the
• 21:39
  Speaker 7: United States does not mean they're not going to happen.
• 21:42
  Speaker 5: Well, AI obviously is a global challenge. Another global challenge
• 21:45
  Speaker 5: is higher energy prices, which obviously is having an impact
• 21:48
  Speaker 5: for politicians, regardless of where they're running, whether they're Republican
• 21:53
  Speaker 5: or Democrat. The Republicans as the incumbents obviously have that challenge.
• 21:56
  Speaker 5: So I want to ask you about the pushback, the
• 21:58
  Speaker 5: greater pushback we're seeing to the war in In Iran, Sarah,
• 22:02
  Speaker 5: there was a War Powers Resolution vote in the House
• 22:04
  Speaker 5: as well before they left. Seven Republicans voted for it, including, interestingly,
• 22:09
  Speaker 5: two in Iowa, Marionette Miller-Meeks and Zach Nunn. Should we
• 22:13
  Speaker 5: read into that as much as we're reading into that?
• 22:15
  Speaker 11: Absolutely.
• 22:15
  Speaker 13: It's the polling.
• 22:16
  Speaker 7: I mean, Iowa, they're really against this. And the members
• 22:20
  Speaker 7: did what they're supposed to do. They voted their districts.
• 22:23
  Speaker 7: And it's interesting, you know, they're both retired military. So
• 22:26
  Speaker 7: I thought that was interesting. But, hey, they're doing what
• 22:30
  Speaker 7: American people want them to do, what their districts want
• 22:32
  Speaker 7: them to do.
• 22:33
  Speaker 13: Wouldn't it be nice if every politician.
• 22:35
  Speaker 7: Actually voted the way their districts wanted them to?
• 22:39
  Speaker 13: It happened with Miller-Meeks.
• 22:41
  Speaker 8: Well, that's an interesting point of view. I mean, we
• 22:42
  Speaker 8: are in a world where national politics... uh, leads the
• 22:45
  Speaker 8: day here, Doug, we've had a lot of war powers
• 22:47
  Speaker 8: votes that hasn't curbed any of the president's behavior. Will
• 22:51
  Speaker 8: that continue through the lame duck session? And what if
• 22:53
  Speaker 8: Democrats take control of the house?
• 22:54
  Speaker 9: What does it look like then?
• 22:57
  Speaker 3: I don't know about what will happen in the lame duck.
• 22:59
  Speaker 3: I mean, I think it's interesting. You know, you've got
• 23:01
  Speaker 3: this war powers in the Senate. What really sent the
• 23:03
  Speaker 3: House home was Massey's impeachment bill for Hegseth, which is
• 23:07
  Speaker 3: also basically an Iran vote. And Johnson wasn't about to
• 23:10
  Speaker 3: let that happen because members might have voted their districts
• 23:12
  Speaker 3: to Sarah's point.
• 23:13
  Speaker 5: But, yeah, I don't know about the lame duck.
• 23:15
  Speaker 3: I mean, it's possible we might see something with a
• 23:18
  Speaker 3: bunch of Republican members losing and deciding to grow a
• 23:21
  Speaker 3: backbone and stand up to Trump on this. I think
• 23:24
  Speaker 3: certainly we'll see a lot of oversight if Democrats take
• 23:26
  Speaker 3: one or both houses next year because it's such a
• 23:29
  Speaker 3: politically salient issue. It's tied into the president's own mishandling
• 23:34
  Speaker 3: of government. It's tied into affordability. And it's obviously driving
• 23:37
  Speaker 3: cost increases from diesel to gas and beyond.
• 23:40
  Speaker 13: So certainly a very live political issue.
• 23:45
  Speaker 5: I just want to mention quickly a red headline that
• 23:47
  Speaker 5: just crossed the Bloomberg terminal. The U.S., the Trump administration,
• 23:50
  Speaker 5: has notified Congress that it plans to sell Saudi Arabia
• 23:53
  Speaker 5: up to 48 F-35s. This is a $ 24. 5 billion deal,
• 23:58
  Speaker 5: or it could be worth up to that much, according
• 24:01
  Speaker 5: to the State Department. This has been in the works
• 24:02
  Speaker 5: for a number of years, but obviously is particularly interesting now,
• 24:06
  Speaker 5: given the challenges Saudi Arabia has faced in recent weeks
• 24:09
  Speaker 5: as it had to close its East-West pipeline, do a
• 24:12
  Speaker 5: drone attack, and of course the challenge from the Houthis
• 24:15
  Speaker 5: Yemen and the risks to the Red Sea again. the U.S.
• 24:18
  Speaker 5: is set to sell F-35s to Saudi Arabia in a
• 24:21
  Speaker 5: $ 24. 5 billion deal. As we consider the other issues that
• 24:25
  Speaker 5: are shaping the midterms, though, of course, immigration is another one,
• 24:29
  Speaker 5: and ICE enforcement in particular. And I was fascinated by this.
• 24:32
  Speaker 5: I want to get both of your takes on the
• 24:33
  Speaker 5: new ad from Maria Alvarez Salazar, the Republican congresswoman in
• 24:37
  Speaker 5: Florida who is in a Trump plus 15 district and
• 24:40
  Speaker 5: yet direct to camera is out with a new ad
• 24:43
  Speaker 5: that addresses the president.
• 24:44
  Speaker 7: Listen.
• 24:48
  Speaker 5: Efforts have gone too far.
• 24:50
  Speaker 14: In July, 50% of the 50,000 people that were detained
• 24:53
  Speaker 14: had no criminal record. Be careful what your advisors are
• 24:56
  Speaker 14: telling you about immigration policy.
• 24:57
  Speaker 13: The same Hispanics who helped you.
• 24:59
  Speaker 14: Get to the White House in 2024 feel betrayed today.
• 25:02
  Speaker 5: Hispanics who helped you get to the White House in
• 25:06
  Speaker 5: 2024 feel betrayed today. Sarah, what do you make of
• 25:11
  Speaker 5: this messaging? And do Republicans have a Latino voter problem
• 25:14
  Speaker 5: right now?
• 25:15
  Speaker 13: So Maria is a member of Main Street, for full disclosure.
• 25:18
  Speaker 7: This is a huge issue for the Latinos that are
• 25:21
  Speaker 7: elected in Congress from all over.
• 25:23
  Speaker 13: She is speaking her district. And yes, we do have
• 25:26
  Speaker 13: a problem. There's no doubt. Look what's going on in Texas.
• 25:30
  Speaker 13: It's much closer.
• 25:31
  Speaker 7: And separate from the Senate seats, some of the House
• 25:34
  Speaker 7: seats are much closer.
• 25:35
  Speaker 13: Than they were expected to be. So yeah, we have
• 25:38
  Speaker 13: a problem. She has a lot of guts to do that.
• 25:40
  Speaker 9: No doubt.
• 25:40
  Speaker 8: She's standing, if you're listening on the radio for that,
• 25:42
  Speaker 8: she's standing right there in Lafayette Square with the White
• 25:44
  Speaker 8: House behind her. They had an aerial shot of the
• 25:47
  Speaker 8: White House. We're not fooling around here. Doug, it reminds
• 25:50
  Speaker 8: us of the importance of not conflating border security with immigration.
• 25:58
  Speaker 8: Voters are delineating between these two, aren't they?
• 26:01
  Speaker 9: Yeah.
• 26:02
  Speaker 3: I mean, I think about the I don't know if
• 26:04
  Speaker 3: you guys remember, but Ron DeSantis, when he ran for governor,
• 26:07
  Speaker 3: had an ad where he basically like taught his children
• 26:10
  Speaker 3: how to build the wall with little toys, you know,
• 26:13
  Speaker 3: and to see how far we've come from that point
• 26:15
  Speaker 3: to this is pretty amazing. Look, Florida has a pretty
• 26:18
  Speaker 3: horrible basically prison for kids. Immigrants are people being accused
• 26:22
  Speaker 3: of being deported.
• 26:23
  Speaker 5: And there's been.
• 26:24
  Speaker 3: Stories about solitary confinement and tiny cells there. I'm sure
• 26:28
  Speaker 3: that issue is visceral for a lot of Florida voters.
• 26:31
  Speaker 3: But look, you know, you're saying it's brave for her
• 26:33
  Speaker 3: to do this. I think the time for bravery is
• 26:35
  Speaker 3: long since passed.
• 26:36
  Speaker 10: Right.
• 26:36
  Speaker 3: I mean, we're talking about January 6th, 2020. to now
• 26:40
  Speaker 3: to see a Republican finally stand up on a particular issue.
• 26:43
  Speaker 13: I don't know how much people are going to buy it.
• 26:46
  Speaker 3: I think the Republican Party is completely branded with Donald
• 26:50
  Speaker 3: Trump and that's the way he likes it. And so
• 26:52
  Speaker 3: I'll be curious whether this is effective or whether too
• 26:55
  Speaker 3: much has happened for someone like her to disassociate herself
• 26:58
  Speaker 3: with the president's policies.
• 27:00
  Speaker 5: Well, we'll find out in 47 days, I guess. Doug Farah,
• 27:03
  Speaker 5: Sarah Chamberlain, our political panel on this Thursday. Thanks for
• 27:06
  Speaker 5: joining us on Balance of Power.
• 27:08
  Speaker 8: Stay with us on Balance of Power. We'll have much
• 27:10
  Speaker 8: more coming up after this.
• 27:15
  Speaker 4: You're listening to the Bloomberg Balance of Power podcast. Catch
• 27:18
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• 27:21
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• 27:25
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• 27:28
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• 27:29
  Speaker 1: Just say Alexa, play Bloomberg 1130.
• 27:32
  Speaker 8: We're following the Thursday trade here and glad you're with
• 27:36
  Speaker 8: us on the Thursday edition of Balance of Power here
• 27:38
  Speaker 8: on Bloomberg Radio. You made it to Little Friday. We
• 27:43
  Speaker 8: can just barely smell the weekend. It's coming, I tell you.
• 27:46
  Speaker 8: The House already kind of on its weekend. Did you
• 27:49
  Speaker 8: hear they're gone? I think I mentioned that earlier. They
• 27:52
  Speaker 8: pulled the plug on the whole thing. Everybody went home
• 27:53
  Speaker 8: last night. They will not be back until after the election,
• 27:57
  Speaker 8: until after November 8th. But something important happened. A couple
• 28:00
  Speaker 8: of things did before they left. This one I highlight
• 28:02
  Speaker 8: for now because we talk about data center every day.
• 28:06
  Speaker 8: This week it's been more about the existential threat against humanity,
• 28:10
  Speaker 8: we're told. And lawmakers are hearing about this just as
• 28:15
  Speaker 8: often as we are. So they're trying to put pen
• 28:18
  Speaker 8: to paper, get something done. And in this case, a
• 28:20
  Speaker 8: data center bill aimed at protecting consumers from higher electric
• 28:24
  Speaker 8: bills actually passed.
• 28:25
  Speaker 9: And my God, look at this number.
• 28:27
  Speaker 8: How often do you hear 417 to three? Yeah, three
• 28:32
  Speaker 8: Democrats voted against it. Everybody else all in on the
• 28:35
  Speaker 8: Ratepayer Protection Act. overwhelming bipartisan support because everybody wants to
• 28:41
  Speaker 8: say they tried to do something before the machines came
• 28:45
  Speaker 8: to your home. It directs states to consider this is
• 28:50
  Speaker 8: how it goes. Making firms that operate new data centers
• 28:54
  Speaker 8: pay a federally set rate for high volume electricity usage.
• 28:58
  Speaker 8: That's what the language says. Well, that's not going to
• 29:00
  Speaker 8: change anything between now and November most likely, but at
• 29:03
  Speaker 8: least you're caught in the act because the other news
• 29:06
  Speaker 8: that people are reading about today is about another breach
• 29:11
  Speaker 8: and it's the same company, everybody open AI with a
• 29:15
  Speaker 8: whole new set of disclosures today. You remember this hugging
• 29:18
  Speaker 8: face thing? Well, when that took place, there had already
• 29:21
  Speaker 8: been a series of incidents of AI breaking out of
• 29:26
  Speaker 8: its cage.
• 29:26
  Speaker 9: And doing something it was not told to do. And
• 29:28
  Speaker 9: some of these are doozies.
• 29:30
  Speaker 8: I've got the document in front of me here, our
• 29:32
  Speaker 8: framework for reporting model misalignment. When you hear about misalignment,
• 29:39
  Speaker 8: You know, we have a problem. Alignment is the idea
• 29:42
  Speaker 8: of the AI model actually working in the way that
• 29:45
  Speaker 8: the human wants it to. Misalignment is when it does
• 29:49
  Speaker 8: its own thing.
• 29:51
  Speaker 9: So OpenAI says, we.
• 29:52
  Speaker 8: Got about a half dozen of these we didn't even
• 29:54
  Speaker 8: tell you about because we didn't even know about them ourselves.
• 29:57
  Speaker 9: Out with this report.
• 29:59
  Speaker 8: In a blog post detailing various instances of misbehavior in
• 30:05
  Speaker 8: order to complete a task or succeed at an evaluation.
• 30:09
  Speaker 8: Some examples included models fabricating missing data. They made it up,
• 30:15
  Speaker 8: attempting to bypass network restrictions and AI agents sharing files
• 30:19
  Speaker 8: with each other that they were supposed to keep private.
• 30:23
  Speaker 8: Does that make you pretty comfortable about the direction we're
• 30:25
  Speaker 8: going in? They also outlined a case for employees to
• 30:28
  Speaker 8: self-report similar incidents of so-called misalignment. With previously unreported instances of, yes,
• 30:35
  Speaker 8: making up information in order to return results. And with
• 30:40
  Speaker 8: the scrutiny that we're getting now from Washington, this is
• 30:43
  Speaker 8: another interesting one. What do you think Steve Bannon.
• 30:47
  Speaker 8: Bernie Sanders would say about this. Enter King Charles. Yes,
• 30:51
  Speaker 8: it gets weirder. King Charles has all the AI executives
• 30:55
  Speaker 8: over there today for tea, I guess, because they're not
• 30:59
  Speaker 8: signing any agreements. They're essentially, they're there to reassure the
• 31:04
  Speaker 8: king who is warning them of the existential threat that
• 31:07
  Speaker 8: they're going to make sure everything is all right. Jensen
• 31:09
  Speaker 8: Wong in the room, among others. Here's King Charles from earlier.
• 31:13
  Speaker 8: How can we build international cooperation? and consensus to achieve this,
• 31:19
  Speaker 8: so no nation is left behind, but the human race
• 31:24
  Speaker 8: is left in place. Now, this may sound hyperbolic. I
• 31:30
  Speaker 8: have long thought it is just enlightened realism.
• 31:36
  Speaker 9: I'm sorry. This is.
• 31:38
  Speaker 8: I feel like we've been pushed into the twilight zone here,
• 31:41
  Speaker 8: and I'm having trouble every day following the beat. Maybe
• 31:44
  Speaker 8: Galtham can help me. I just get a kick out
• 31:48
  Speaker 8: of it. Let's bring him in. Bloomberg Opinion contributor, lecturer,
• 31:51
  Speaker 8: Yale School of Management, Gautam Mukunda. We thought of you.
• 31:55
  Speaker 8: You know, producer James wanted you to weigh in on this.
• 31:57
  Speaker 8: And I'm glad to see you because we hear from
• 31:59
  Speaker 8: Steve Bannon and Bernie Sanders about the digital oligarchs. And
• 32:04
  Speaker 8: Jensen Wong decides to show up with the king of England.
• 32:08
  Speaker 8: You can't make up these optics.
• 32:11
  Speaker 2: No, I mean, honestly, if it goes much further, next
• 32:13
  Speaker 2: time you have me on the show, I'm going to
• 32:14
  Speaker 2: stake out that rare pro-extinction position where, you know, AI
• 32:18
  Speaker 2: can take us out.
• 32:18
  Speaker 9: I'm okay with it. Okay. Listen.
• 32:23
  Speaker 8: I don't know where to go with this today. When
• 32:25
  Speaker 8: you see the headlines that I just mentioned, more models
• 32:29
  Speaker 8: are breaking out doing things they shouldn't be doing, even
• 32:32
  Speaker 8: as Washington tries to get its arms around it. Do
• 32:34
  Speaker 8: we get the AI we deserve? Is that the question
• 32:37
  Speaker 8: that we should be asking right now? We get the
• 32:39
  Speaker 8: Congress we deserve with the politics in this country. If
• 32:42
  Speaker 8: AI is modeled after human nature, isn't this what we get?
• 32:47
  Speaker 9: Yeah, I think you're exactly right.
• 32:49
  Speaker 2: And it's sort of pretty striking how the different bots
• 32:51
  Speaker 2: all seem to reflect the personality of their creators. You know,
• 32:56
  Speaker 2: when you talk with Claude, it sometimes feels like you're
• 32:59
  Speaker 2: actually speaking with Dario Amadei.
• 33:01
  Speaker 13: And there is some of this.
• 33:02
  Speaker 2: There's also, like, look, it's great that OpenAI made this disclosure,
• 33:08
  Speaker 2: although it seems to have taken them a little longer
• 33:09
  Speaker 2: than it should have. It's great that they're talking about
• 33:11
  Speaker 2: safety measures. But if OpenAI is actually serious about not,
• 33:15
  Speaker 2: you know, trying to take safety seriously and, you know,
• 33:18
  Speaker 2: maybe we should have regulation, then Greg Brockman, its president,
• 33:21
  Speaker 2: probably shouldn't.
• 33:22
  Speaker 5: Be donating massive amounts of money.
• 33:25
  Speaker 2: To PACs whose cause is to block all.
• 33:28
  Speaker 13: That kind of regulation.
• 33:29
  Speaker 2: Like, there's a real conflict between words and actions here
• 33:32
  Speaker 2: that's becoming more and more striking.
• 33:34
  Speaker 1: Hmm.
• 33:35
  Speaker 8: Well, we thought Hugging Face was a big deal. It
• 33:37
  Speaker 8: turns out there's a lot more where this came from.
• 33:39
  Speaker 8: I will note, Guatham, the company says... that these reports
• 33:43
  Speaker 8: are only an initial set of disclosures. They are not
• 33:45
  Speaker 8: a comprehensive account of issues arising from its chatbots. Are
• 33:49
  Speaker 8: we going to find ourselves a year from now finding
• 33:52
  Speaker 8: out about hundreds of breakouts that we never knew about
• 33:56
  Speaker 8: while they were happening?
• 33:57
  Speaker 2: I don't know about hundreds, but I'd be shocked if
• 34:00
  Speaker 2: this is the complete roster, because the Hugging Face breakout,
• 34:03
  Speaker 2: they found it basically because the bots were so clumsy,
• 34:05
  Speaker 2: it was impossible not to find it. And then Ruby
• 34:08
  Speaker 2: Gems was a couple of days later, and then, hey,
• 34:10
  Speaker 2: it was the same problem.
• 34:11
  Speaker 1: In fact, I would, like.
• 34:13
  Speaker 2: I was on air on Sunday, and the first thing
• 34:15
  Speaker 2: I said was, these are just the ones we know about.
• 34:16
  Speaker 2: There's surely more to come. And bam, there are. So
• 34:20
  Speaker 2: I want to make a distinction with what's happening here.
• 34:23
  Speaker 2: I think that the AI companies are putting a lot
• 34:26
  Speaker 2: of emphasis on creating autonomy. They're creating bots that can
• 34:31
  Speaker 2: work for days or even weeks without human intervention. That,
• 34:35
  Speaker 2: more and more, I suspect we are going to see
• 34:36
  Speaker 2: that as a mistake, that it is just too easy
• 34:39
  Speaker 2: for those bots to run out of control when they
• 34:41
  Speaker 2: have days or weeks without a human in the loop.
• 34:43
  Speaker 2: And eventually, I suspect there's going to be people coming
• 34:46
  Speaker 2: in and saying, we need to really rethink the role
• 34:48
  Speaker 2: of autonomy in our NAI research.
• 34:51
  Speaker 9: It's been suggested recently.
• 34:53
  Speaker 8: Gautam, and this has been an important week for AI following,
• 34:55
  Speaker 8: you know, look, it started with the memo from Dario
• 34:57
  Speaker 8: and everyone started chiming in here and it's really changed
• 35:00
  Speaker 8: the contours of this argument. But are our fears misplaced?
• 35:05
  Speaker 8: Everyone's wondering when the machines are going to take over
• 35:08
  Speaker 8: and Arnold Schwarzenegger is going to be at your door.
• 35:11
  Speaker 8: We're spending less time thinking about the purposeful human use
• 35:17
  Speaker 8: of AI to hack computer systems, governments, utilities. our own
• 35:22
  Speaker 8: bank accounts. This is why CrowdStrike in Palo Alto or
• 35:25
  Speaker 8: at New Highs, it seems like every day. Is that
• 35:29
  Speaker 8: the fear that we should be addressing in the near term?
• 35:32
  Speaker 2: So it's definitely a much more plausible fear and a
• 35:35
  Speaker 2: much more near-term fear. The odds that human beings will
• 35:39
  Speaker 2: use AI's capabilities to do bad things are 100%.
• 35:43
  Speaker 13: I don't know what it is.
• 35:44
  Speaker 2: And it's really important to do exactly what you just said,
• 35:47
  Speaker 2: which is differentiate between things we are worried that AI
• 35:50
  Speaker 2: will do to us and things that we are worried
• 35:52
  Speaker 2: that we will use AI to do to us. Because
• 35:55
  Speaker 2: the solutions to those two risks look completely different, right?
• 35:59
  Speaker 2: The first category of risk you manage by limiting the
• 36:01
  Speaker 2: power of AI. The second category of risk you might
• 36:04
  Speaker 2: manage by actually distributing it and making sure that defenders
• 36:07
  Speaker 2: have access to the most powerful AI tools in order
• 36:09
  Speaker 2: to protect themselves from this sort of malicious attack. But
• 36:12
  Speaker 2: those are completely different categories of concern. And, you know,
• 36:15
  Speaker 2: I mean, look, a political system where Chuck Grassley, who
• 36:18
  Speaker 2: is always my favorite piece of political trivia, older than
• 36:21
  Speaker 2: the chocolate chip cookie, has a major role in deciding
• 36:26
  Speaker 2: this kind of policy is probably going to struggle.
• 36:31
  Speaker 9: I never heard that. That's fantastic.
• 36:35
  Speaker 8: You were at the Yale School of Management, as I say,
• 36:39
  Speaker 8: in your intro. Are you personally using AI? I'm just
• 36:43
  Speaker 8: curious as we talk about this, because to your point,
• 36:47
  Speaker 8: most lawmakers, as we've learned, are not. And to what
• 36:49
  Speaker 8: extent has it changed the business on campus, the business
• 36:54
  Speaker 8: of education and the way you interact with those you're lecturing?
• 36:59
  Speaker 2: So I use AI constantly. I don't actually use it
• 37:02
  Speaker 2: very much for the work I do at Yale. So
• 37:04
  Speaker 2: I want to differentiate between those two. But for the
• 37:07
  Speaker 2: work I do for research, I use it constantly as
• 37:11
  Speaker 2: a research tool when I'm writing, when I'm working with
• 37:13
  Speaker 2: private companies, like Claude is open on my right side monitor.
• 37:19
  Speaker 2: if I'm at a computer, period, like always. And it
• 37:22
  Speaker 2: is an extraordinarily powerful tool if you know how to
• 37:25
  Speaker 2: use it. If you use it badly, I think it
• 37:27
  Speaker 2: will actually make you worse at your job. But if
• 37:29
  Speaker 2: you use it well, I think it can make you
• 37:30
  Speaker 2: enormously better. At Yale, because we're still trying to figure
• 37:33
  Speaker 2: out what are our policies on you, how do we
• 37:35
  Speaker 2: handle students who use AI, there I try not to
• 37:38
  Speaker 2: use it for exactly that reason.
• 37:41
  Speaker 9: It's really interesting.
• 37:43
  Speaker 8: Should all lawmakers... be given a Claude or open AI
• 37:48
  Speaker 8: account so they can start experiencing what the heck it
• 37:51
  Speaker 8: is they're trying to regulate?
• 37:53
  Speaker 2: I mean, I can lead a horse to water, but
• 37:54
  Speaker 2: I can't force them to drink, right? Like you can
• 37:57
  Speaker 2: ask lawmakers to, you can.
• 37:59
  Speaker 9: Give lawmakers access to Claude.
• 38:01
  Speaker 13: I doubt they'll use it.
• 38:02
  Speaker 2: And I mean, technical sophistication is not, so like we
• 38:07
  Speaker 2: just had in Congress, right? So where where Scott Besant
• 38:11
  Speaker 2: was questioned before a committee and they said, hey, you
• 38:14
  Speaker 2: have no people with any level of technical skill anywhere
• 38:19
  Speaker 2: in your treasury. There's no one in your treasury department
• 38:21
  Speaker 2: who has any actual knowledge of the subject matter with
• 38:25
  Speaker 2: which they're dealing with. And Besant smirks and says, well,
• 38:27
  Speaker 2: maybe you don't know this, but Robert Oppenheimer was not
• 38:30
  Speaker 2: a physicist. I'm going to note Robert Oppenheimer was a
• 38:32
  Speaker 2: professor of theoretical physics. He was not just a physicist.
• 38:35
  Speaker 2: He was kind of the physicist. So I have no
• 38:37
  Speaker 2: idea where Besson got that piece of trivia from. But
• 38:41
  Speaker 2: this is not, you know, both sides have problems on this,
• 38:44
  Speaker 2: but particularly with the Trump administration. I don't think they
• 38:47
  Speaker 2: value technical expertise that much.
• 38:49
  Speaker 1: Yeah, I know you do.
• 38:51
  Speaker 8: And I'm glad you could join us. This is a
• 38:52
  Speaker 8: great conversation. Gautam Mukunda, Bloomberg Opinion, Yale School of Management.
• 38:56
  Speaker 9: Great to see you.
• 39:00
  Speaker 8: Thanks for listening to the Balance of Power podcast. Make
• 39:03
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• 39:06
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• 39:09
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• 39:12
  Speaker 8: at Bloomberg.com.