You have been a career-long advocate for stronger regulation of technology in general.
David, let me correct you. Any regulation? We don't have any. So, not stronger.
What's your line? Your Delhi is more regulated than the biggest tech platforms in America.
Hello and welcome to the David Frum Show. I'm David Frum, a staff writer at The Atlantic. My guest this week will be Kara Swisher, host of the On with Kara Swisher podcast and co-host of The Pivot, and co-host very excitingly of a new podcast that she will co-star Hillary Clinton. And we'll be talking about that new podcast with Kara. This week's book is The Rise and Fall of American Growth: The US Standard of Living Since the Civil War by Robert Gordon, an enormously influential book on economic history published a decade ago. And I'll be discussing whether the advent of the AI revolution changes any of Robert Gordon's pessimistic assessments of what has happened to American growth since 1970.
But before the dialogue with Kara Swisher, and before the book discussion, I want to open with some thoughts about the debate over Medicare for All. The slogan and the idea, Medicare for All. It does look like the next Congress will feature many more advocates of the Medicare for All idea than American politics has seen for a long time. There are bills in Congress purporting to offer or designing or proposing a Medicare for All scheme. It's a slogan on the campaign trail. Let's take it seriously. Let's think about this in a real-world way, because we may be talking about this a lot come 2027. What does Medicare for All mean? How would you get there if you were minded to get there?
So understand Medicare, of course, is the program that provides much health insurance for people over 65. It has components with prescription drugs, but the core of it is that it covers medical and hospital bills for people over 65, with some contribution from the over-65s themselves. The Medicare for All proposal is to extend this scheme through all of the American economy, covering everybody through the Medicare program, and displacing a lot of the healthcare insurance that you have now, which is mostly those people who get private health insurance get it usually paid for through an employer out of the worker's pay, but through an employer. How would it mean to make this change from a system where much of the healthcare in the economy is paid for by employer-financed private insurance to one where the US Treasury pays for most healthcare?
So, a half a decade ago, at the end of the 2010s, there was a big study of this. Congressional Budget Office, and others too, did a big study of what it would mean to transition to a Medicare for All program. And CBO's estimate in the year 2020 was that such a program would cost the US Treasury, over the next 10 years, about $30 trillion. The work has not been redone by CBO, but if you just figure prices are higher, you're going farther out into time, starting in 2030 and going to 2040, it's a good guess that it would cost closer to $40 trillion over 10 years than it would cost $30 trillion over 10 years. So where would you get the $40 trillion? The US Treasury is going to be spending a lot more. How would it get the extra $40 trillion?
Now proponents of Medicare for All will say, and they're not completely wrong about this, they will say, "Wait a moment, that's not $40 trillion of new spending. We're spending the $40 trillion now or thereabouts. We're spending it one way, that is you get it mostly from your private insurance through your employer. So we're just taking $40 trillion from this sector of the economy and moving it over to the government. Net net it will even out. Maybe it's a little bit more expensive than what we have now but not a lot more expensive." Let's suppose they're right about that. Still, we have one way of financing it now and we're going to be moved to another way of financing it along the way. How do you make that transition? What would that look like?
The proponents of Medicare for All will say this. Look, when you get a job, if you have healthcare, you are really paying for the health insurance. Your employer lowers your wages to cover the cost, and then pays an insurance company or they self-insure. But in any way, the employer finances the payment of the health coverage out of the wages that you don't get. When we move to healthcare for all, Medicare for All, the employer will no longer be buying private insurance. So your wages should go up, and out of that higher wage, you should be able to pay a higher tax.
But that blackboard analysis blinks the fact that yeah, you're going to be paying a new tax, probably a payroll tax, maybe some other kind of tax, and it's going to be quite a big tax that is going to fall on just about every worker in the economy. Now again, you're paying a kind of healthcare tax now because your wages are lower. But the Medicare for All people assume that your employer will raise your wage almost all of what you're now paying for health insurance through your employer. You'll get almost all of that money back. Maybe all of it. That's the assumption. And so you'll be well positioned to pay the new tax, which will not be heavier than what you're paying now.
But even if that's all true, it won't be true for everybody. Some people will be winners. Some people will be losers. Some people will be big winners. Some people will be big losers. And everybody will see a new tax on their paycheck. So what Medicare for All means from the point of view of American politics is the new president elected in 2028, assuming that president is committed to this idea, the new Congress that comes to power either now or in 2029. That new Congress, one of their first orders of business will be passing the biggest and most far-reaching tax increase that Americans have seen on their paychecks since World War II. That's what Medicare for All means. Start the next Congress, start the next presidency with a massive increase in a visible tax that you explain to American people they won't really feel because their wages should be going up if their employer gives them back the money the employer is keeping right now to pay for health insurance.
And aware of the politics of this, some of the Medicare for All proponents have come up with a series of gimmicks to conceal the tax. In 2019, Senator Elizabeth Warren proposed a system where we wouldn't have a payroll tax. We'd tax the large employers in the economy directly. Every employer with 50 employees or more would pay a new tax directly on the employer. It would be invisible to the employee. And that would get us the transition to Medicare for All. But the Warren idea has been almost universally derided by experts in the field as completely complicated, unworkable, and inviting all kinds of distortion. For one thing, it would mean that no employer in the economy who had 49 employees would ever hire a 50th. The 50th employee would generate a massive new tax on that employer. So on the verge of this AI revolution that is calling into question all kinds of people's employment, you'd create a massive new tax that would say just if you're at 49, stay there forever, never get to 50 employees. So that seems a kind of daunting and distorting.
Even if you believe all these things, you're signing up for a big project. Now, the really irresponsible people in the Democratic party, the Bernie Sanders will say, "We don't need a payroll tax. The billionaires and the millionaires, they'll pay for it all." But that's again more sloganering. The math doesn't work. And anyway, billionaires and millionaires find it quite easy to escape taxes. And the way you would write the tax would be with an increase in income taxes. And that would be seen not just by billionaires and millionaires, but by lots and lots and lots of people. There is no way around it. Medicare for All means transition to a new kind of program that needs a new kind of funding mechanism that requires a new and highly visible tax that will fall on many, many people.
And if you think no Congress will ever pass that thing, which is kind of what I suspect, then when you talk about Medicare for All, you are promising something that you know you cannot deliver. One of the reasons I think that American politics has seen so much demoralization and polarization over the past 15 years is because you've had politicians, President Trump is the worst offender, but he's not the only offender, who promise things they know can't happen. You're not going to restore American manufacturing and make America great again by keeping out foreign products. You can't pass tax cuts forever and have no spending cuts. Those things just don't work. Gravity, math, they all exist. And people, if not the candidates themselves, people around the candidates, they know they're promising things they can't do. And Medicare for All is just such a thing.
Now, where Medicare for All is very useful for a politician, and this goes back to the Bernie Sanders model. If you're the one senator who is in favor of this idea, and all the other senators say it's unworkable, we're not going to do it, then you can get enormous attention for yourself. You can pose as the one truth-teller in the Senate, the one honest man in the village of the accomplices and the weaklings. You're the one guy and you're saying this one thing, and you don't have to worry about the unfeasibility of it because no one will ever let you do it. That's how you get the career of Bernie Sanders, which is a career of decades in public life, almost no accomplishments of any kind, but an enormous following because of the promises he keeps making. You can only have one of those guys, one in the Senate, maybe a handful in the House. If you have a dozen senators who are promising things like that, if you have 40 or 50 or 60 or 80 or 100 members of the House who are promising those things, the question of the design of the program, the question of how this is going to be paid for, the question of the massive tax that will fall on Americans on the promise that their wages will go up because the employers will give them back the money the employers are now paying for private health insurance. All of that really comes to the fore.
One of the ways to get to a better politics in America is for politicians to make promises that they know they can keep and that they intend to keep. And one of the ways to keep us on the bad path we're on now is to have lots of people making promises that sound good to a comparatively small coterie of the voters, but that they know or should know they can't keep, that they know or should know that they won't keep, that they can know or should know are impossible. We've got a lot of that going on right now and it points the way to further demoralization, further polarization. Change in an advanced society like the United States, in a complex bureaucratic society with a lot of vested interests, it has to be incremental. Even if incremental change is imperfect, that's the way it has to be. And anyone who promises you a non-incremental change is promising something they can't deliver and probably don't mean.
And now, my dialogue with Kara Swisher.
Kara Swisher hosts On with Kara Swisher, co-hosts Pivot with Scott Galloway, and has a CNN series on the people trying to live forever. She has just announced a new election season podcast with a co-host you may know, Hillary Clinton. Kara Swisher is known to her many followers as a tireless and fearless reporter on technology and those enriched by technology. She is the author of three books, most recently Burn Book, a tech love story from Simon & Schuster, in which she calls Mark Zuckerberg the most damaging man in tech and Elon Musk the most disappointing. On election day, she'll be on stage in Toronto for a live taping of Pivot. So Canadian viewers and listeners may want to make a note of that. Kara, welcome to the program. Thanks so much.
Unfortunately, we're sold out in Toronto because the Canadians love us, but
Oh, congratulations. Congratulations.
Getting Canadians out on a dark November night. Well, we're going to get them warm. We're going to warm them up with dick jokes and insights. So, that's what we're going to do.
All right. So, let me start by asking you about your new co-host. How did that come to be? Tell me about the project.
Oh, you know, it's really interesting. One of the things I do a lot and I have done over my career is I kind of zig when others are zagging or I do something unusual. And you know, there's this sort of trope that all Democratic establishment older people don't know what they're talking about and they need to move aside. And I have said many of them, I have said directly they should do that. But I was at this dinner party and I've known Hillary for a long time and I've interviewed her many times on different things I've done over the many years. And it was at one of these big fancy tables and Hillary had me sit next to her because we have a really good rapport and we sort of tease each other a lot in ways people don't, I think, tease her. And she just had a mind full of really great fast insights that were fresh to me that I hadn't heard, and I hear all the insights. And then, you know, the economy insights, Trump insights, and actually in a way that you were not expecting from her. I was like, it was quite smart, very clear. And I thought, what is going on with her these days? Because she really didn't care anymore. And of course this is what you hear off the record. And I thought, this is the Hillary you see in those Lauren Boebert Epstein hearings or in the Benghazi hearings, very smart, very sharp, some often on social media. And I thought, I'm going to bottle that Hillary. And I just knew. And by the way, it's racing up the charts right now. We're now number four, which I know is because of her. And it's because she has these fresh insights. And I wanted to show people that Hillary I know on the topics she's good at. And so it's worked, and we have the rapport, which is important. But anyway, that's what we're doing and we're trying it out. If it really works as both a business and a piece of content, we're going to keep doing it through the presidential.
So, is it the two of you ping-ponging with each other or will there be third parties there? How will this work?
There's going to be guests. We just did one to start with. Well, I did it very quick. I do everything I do very quickly essentially. And you know, it was a germ of an idea, but it's like Hillary unplugged or like when Johnny Cash came back and was doing Nine Inch Nails, that's what I feel like I'm doing here. You do want to hear her. And I had tested it on Pivot where she was spectacular. And we'll have guests. I want people who disagree with her and who she disagrees with, both on the left and the right, because that's when she's at her best. And really have some throwdowns. So people, I'm talking about reasonable people, not insane people. I'm not going to have Laura Loomer go against Hillary Clinton because it's kind of ridiculous and pointless. But I want to have robust discussions about difficult issues, and I think we will, by smart people with substance.
Will you be able to get her to defend the person she actually is? And what I mean by that is those people who were prominent in the Democratic party from 1992 to 2008ish, 2010. The people who believed in making government more efficient, in expanding trade and bringing Mexico into North American economic life. That's what she was associated with. And they came under attack from their party's left. And they seem to just be like shamefacedly mumbling and not, oh, you're so right and the establishment was so bad and yes, we should burn everything down. Well, will she on your program be willing to stand up for the person she was?
Yeah, I think she'll defend it and also say what's good and bad. What I was really struck with on the Pivot podcast is I was expecting her to do the sort of typical Democratic spouse, Trump thing, and she had a very insightful reason why he's doing well, here's where he could go wrong, and stuff like that. You know, look, fact of the matter is she's been a, whatever you say about the presidential race, and I thought you know that there's all manner of complexity there. It's not just because Hillary lost. Donald Trump really won that election. And the changing tide of the American public and the sort of attacks that the right had on her for years that ended up working after a while. I think she will be very honest. I think she's at a point, and she did say this, people like her more when she's not running for anything. People like her more when she's either in office or in service of a, you typically a man. It's a little bit, you know, I, if I lived back then, I would have liked to have Eleanor Roosevelt do a podcast with me. Like, all the insight she gained over the years. And a good thing that she did this week, she was, we were talking about the execution, which has now been cancelled publicly by Donald Trump. She said, "He's going to cancel it, and here's why." And she was 100% right. And she analyzed it and then threw in what they did during the Bin Laden raid, which was very helpful to understand the complexity of like there were people in the room that wanted to show his bullet-riddled body. They brought in experts. They brought in all kinds of things saying what the best outcome would be. And so she's got a lot of wisdom sort of hidden in there that can be relevant to today. And again, she's gonna have to admit mistakes. She knows that and she's actually willing to do it.
I'm sort of more interested to hear her not admit mistakes if she doesn't believe she made them. What I mean by that is I'm a graduate of a Republican world where the rule of the game was, if you were in the center of the party, you had a big "kick me" sign on your back and the right of the party could say anything about you and you could never say anything back. And the Democrats seem to have that same relationship with their left. And I'm thinking about, so Hillary Clinton was instrumental in the negotiation of the Trans-Pacific Partnership in the Obama administration. She was proud of it. She believed in it. She was right. She defended it in the hardcover edition of the book she published before the 2016 election. And she stripped it out of the paperback edition. And you said, "Why not stand up for what you believe? Why the kick me sign?"
She might have changed her mind, David. It's called changing. She may have thought more about it. And think about one of the things I really like about her is she thinks in real time. She's really, compared to a lot of Democratic people who would just spout the same crap essentially like everything's fine. I mean, I just feel like she's willing to throw down all kinds of ways. She's also willing to be flexible about good ideas. And I think where she is right now in her career, this is, she should speak to you about this, but I think where she is in what works, right? Like she started talking about the execution like, of course it's heinous. Of course it's immoral, but let's not focus on that. Let's focus on this. If they do this, it's going to be a recruiting video for jihadists. So let's not do that. Like she's very practical. And so I think she will, whatever works seems to be where she is in her life. And she's not worried about the Democratic establishment shouldn't speak. She doesn't care. She doesn't care and she shouldn't.
Let me ask you about what works and things you've changed your mind about. So you have been a career-long advocate for stronger regulation of technology in general.
David, let me correct you. Any regulation? We don't have any. So not stronger.
What's your line? Your Delhi is more regulated than the biggest tech platforms in America. Okay. So some of the AI executives have in recent months and years begun to repeat what you have been saying earlier. And my question to you is: When you hear that, do you think, "Okay, they're in a death race and it drives everyone to do things they don't wish to do, and if only the competition could be a little less fierce, then maybe they could think more about safety," or do you think there's something nefarious going on, that they've got some other agenda? Do you take them at their word when they say these things? Are they reformed characters? How do you read it?
No, I mean, my approach to most of these people, not all of them, most of them is, "Hello, he lied." You know, essentially. And so I think they, there's a, it's a little complex. You know, it's more complex than the way we binary every single thing we do around technology these days. They're villains or they're heroes or they're this or they go from this or we love them, we hate them, that kind of thing. And that's life, isn't life's not like that. Essentially, what I think is happening is they hate regulation. They don't want any. That's why they sucked up to Trump the first term and that's why they sucked up to him this time. Some of them had real political conversions, but for the most part, they want to make money. They want to dominate, and that has never changed in all the time I've known them. So, as I joked, if Kamala Harris had won, Mark Zuckerberg would have been identified as they/them if it suited him. They'll do whatever it takes. Like, you know, and by the way, guess what's going to happen when the Democrats come in? Oh, he was the worst. I can't believe I went to dinner at his house 412 times.
Thank God you got here. I've been waiting. I've been in this basement waiting for
Having a good time at that lunch. These people literally would sell their mamas down the river if they needed to. That's my feeling on the general populace. And they're very interested in winning, like that winning and shareholder value. I mean, if Tim Cook is going to give a golden statue to Donald Trump, you got to know what's going on there. Now, I've heard since then he actually likes Donald Trump, which okay, fine. No accounting for taste. But you know, I think it's all about shareholder value. Every single thing they do. And so I think when they talk about regulation, they want the regulation they want that is good for them. They never think of safety unless they're forced to. But neither did big pharma. Neither did airplanes. If cars, you know, car, hello, unsafe at any speed. That's what it took. They wouldn't have put seat belts in there if they didn't have to or airbags. The chemical companies would love to spew poison, and oh well some people die and those people were civically interested. The tech people have never been civically interested, ever. Like they don't care about other people. And so we just have to make them have safety. And we should, because this is very much like nuclear proliferation. This is the same, this is on the same level of importance. Why are we outsourcing our safety to private industry on a topic that they themselves say is existential?
Well, this is the thing I find sort of baffling. There are people who say, and there are AI skeptics who say, you know, it's not that big a deal. It's the latest computer thing. It's not transformative. Well, there are people who say that. And then if that's what you believe, okay, yeah, I'd have a light footprint because how heavily do we regulate word processing technology? And then there are people who say it's going to kill us all. It's going to kill us all. Then it should be illegal. Government should be not just regulating it. I don't understand the people who take the view, "I want to run a big company that makes products that I fear are going to kill us." Why are you doing that?
I think the kill us all thing is, you know, the way tech people talk. You got to have listened to them for so long. They love to say nonzero chance. I was doing an interview with Elon Musk once and he's like, there's a nonzero chance we're in a simulation, meaning we're basically a video game for a greater civilization of teenagers are playing Earth, whatever it happens to be. And we aren't real. We're all a simulation. Well, it is a non-zero. It's like there's a non-zero chance that there is a god sitting up on a cloud. And so that's what they tend to do. And so what they know is, I think Elon actually said it best. It's like this isn't just nuclear bombs. It's things that can set off nuclear bombs without you wanting it to, essentially. And I often recount this dinner party I had in Silicon Valley 10 years ago. All the big, many of the big names right now, they were posing these questions. What would, if you told AI to solve world hunger, what would it do? It would kill half the human race because that's the right answer. It's not the right answer. It's the answer that would work the quickest, right? And so they just, they, I think there is an existential crisis, but they don't
Wait, let me stop you with that. That's even, that's a terrible answer actually because even if you're a Nazi, because killing half the human race is a lot more expensive and time-consuming than feeding the 10% of the human
Oh, they would do it with a nuclear bomb, my friend.
Do you think this is a line of work that attracts people with severe personality disorders and that that distorts their thinking about problems?
No, I'm thinking the AI would do it because it doesn't have any emotion. It isn't attached to humanity. Like when Elon started off, it was interesting. I'll use him because he was the earliest person to talk to me about the threats, he and Sam, but mostly Elon about the threats to of AI, and was very concerned. And I think, you know, he's a science fiction guy; it also informs him. A lot of these people are science fiction types; this is part of the air they breathe essentially. And what his first thing was, Terminator-like, and we all have seen that movie where, you know, time machine comes back, kills the original, blah, blah, blah. And so, that's where they were, in sort of this dystopian idea. And that gives the machines a personality, an anthropomorphic personality, when in fact it doesn't. Or like The Matrix, like they want to keep us as batteries, or they have a malevolence. It's always a malevolence. Mostly it doesn't have malevolence at all because it doesn't care. And doesn't care. I don't mean hates us. It means we don't exist. So he moved on to the idea that AI treats humans like house cats. Like we don't want to kill our house cat. We'll feed our house cat. But that's how they look at us. Again, a little too anthropomorphic. The third one I thought he came upon was the best one. This was later, which is, we're building a highway in Georgia and we put down asphalt. Do we know we've killed a lot of ants and anthills along the way? Do we think about it at all? No.
Okay. So what I meant by that crack about personality disorders is I wonder whether when we inevitably anthropomorphize everything, that's the way our minds are constituted. If you have a severely dysfunctional personality, when you anthropomorphize, you imagine the AI to be like you. So when Elon Musk thinks what would an AI be like, he thinks it would be like him. And yeah, indifferent to human suffering. I wonder if a more normal person who had read say Frankenstein instead of the Terminator might say that this may be a more complex, tragic, meaningful relationship. And there's a kind of the limited kind of this odd stuntedness in some vectors combined with obviously great talents in others that makes people poor understanders of the world around them.
Yeah. They like to understand everything. The machines have power when they have power. They'd like to offput their power and their blame onto the machines. And it's not the machines that are the problem. You know, it's like saying electricity is the reason we electrocute people or the knife was the reason people died. It's because the person with their hand on the knife kills someone. And so they just want to blame the knife, right? Actually, recently, you know, Jeff Bezos talked about this, like, "We can't be against the knife. We're against murder." I'm like, "Yeah, we're against murder by you." Like, they don't like to take that step by focusing in on the machine. And one of the things they tend to do a lot of is remove themselves from the equation, that they are at fault in any way. And this is a longtime thing, you know, with social media. Oh, I don't know why girls are feeling self-esteem problems. Do boys listen to more porn? I wonder what caused that. Like they're very much not of that. And one of the things they've done which I have followed is just that they, one, that they're the victims, and two, that they never have consequences for the things they make. And this is the same kind of thing. This is what they made. And my only argument is like why are we letting them decide on something this important? Because they're broken people and we need a bigger pool of people making a decision about something that they themselves say is very important.
Well, let me ask about another one of your recommendations that has come true. You argued often that the ownership of TikTok should be shifted from its Chinese founders. Congress passed a law demanding calling for just that. The Supreme Court said that that law was constitutional. Congress had the power to force the sale of TikTok, at least its US operations, to a US operator. And it eventually did happen. But what it seems to have happened is none of the things that are toxic about TikTok have changed. It's just TikTok has been sold in ways to enrich President Trump's allies and supporters. When you look back on that, do you think, "Hmm, that's not what I meant? They didn't hear me right?"
I was worried at the time, many people worried about the deleterious effects of social media, which are very real, and lots of impersonality, etc. I was worried about propaganda. I was a propaganda studies major at the School of Foreign Service. So, I think about what could you use these things for? And if I were the Chinese Communist Party, that's exactly what I'd do. I mean, I'm not mad at them for doing it. It's just that's what you would do to have this. And there was no such service in China to be able to do that. I mean, our best thing is to love Voice of America over there and it doesn't really work. The internet, possibly as a way to get through into that culture, but they strictly control their information diet there. And so I was worried about propaganda. Then I was worried about the ability to shift the narrative with the algorithm. But again, that's gone back to William Randolph Hearst. I mean, this is not new.
Well, I'm personally, the Trump administration seems like the nightmare version of the advice you've been given. They have an activist Federal Communications Commission which is on the march in all kinds of ways to stop things that they don't like, whether it's The View or Jimmy Kimmel. Do any of your feelings about regulation change watching the Trump administration wield these regulatory powers?
