CEOInterviews.AIfull interview with Amazon founder Jeff Bezos

A

Andrew Ross Sorkin0:11

On the factory floor this morning of Blue Origin. And we are here with Jeff Bezos, the founder of Blue Origin, also, of course, the founder of Amazon. It is great to see you. This is remarkable, by the way, just the scale of it. We've been talking about it all morning, but of all the people that we could talk to about everything that's going on in the country right now and the economy, AI, jobs, space, we want to talk to you. And there is so much to talk about. We're going to touch on that policy, politics and so much more. But one of the topics that I thought we should talk about and maybe even start with, is these days, it feels almost impossible to pick up a newspaper without reading a headline about wealth in America, about the billionaire class, about wealth inequality and policy and everything else. And it's taken a uniquely critical turn, I think. And I'm so curious, before we even get into everything else, what you think about that right now.

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Jeffrey Bezos1:15

Well, first of all, Andrew, I'm glad you're asking the question. I think it's a really important topic, and I think it's an important one to discuss because I see the same thing you do. You see a bunch of headlines, you see it in a bunch of places. And I've been thinking, I have been thinking about what is driving this, because it does seem different from ten years ago. And I think what's going on is that it's kind of a tale of two economies. So you have a bunch of people in this country who are doing really well, but you also have a bunch of people in this country who are struggling, struggling to pay rent, groceries. And so what's happening here is politicians are using the kind of age old techniques. So there's this tale of two economies, and they're using this age old technique of picking a villain and pointing fingers. But the problem is that doesn't solve anything. And so like, if you want to help the group of people who are struggling, you have to figure out real root causes and solutions. And that takes skill. You know, it's like the way we, if we have a problem at Amazon, the way we would fix it is we would go in and we'd do the five whys and we'd try to get to a root cause. We try to find a root fix and then we fix it at the root. You're fixing it forever. It's a real solution. And what we don't do because it doesn't work is just point fingers and blame people. It might feel good for 10 seconds, but it doesn't accomplish anything. And so what could you really do? So like I, you know, I yeah.

A

Andrew Ross Sorkin2:55

Do you have a plan?

J

Jeffrey Bezos2:56

Well, I have some ideas. I have some places to start. So, you know, if I started thinking about this and doing some research, a nurse in Queens who makes $75,000 a year pays more than $12,000 a year in taxes. Does that really make sense? So people talk about making the tax system more progressive. How about we start by having the nurse in Queens not pay taxes? Why is somebody at all? Why is a nurse in Queens who makes $75,000 a year paying more than $1,000 a month in taxes? That's $1,000 a month that could help with rent or groceries or anything. And by the way, do you know what that all adds up to? The bottom half of income earners in this country pay only 3% of the taxes. It's only 3%. We can find 3%. So we don't have, it's a small amount of money for the government. You know that. And really it's, and the more I thought about it, to me, it's kind of absurd that we're doing this. You know, we shouldn't be asking this nurse in Queens to send money to Washington. They should be sending her an apology. It really makes no sense.

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Andrew Ross Sorkin4:21

Okay. But then on the other end, the question is, should you be paying higher taxes to pay for the 3% component part of this that you think is going to need to be paid for, if not more than that, given the debts we have.

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Jeffrey Bezos4:36

It's certainly a perfectly valid policy debate to say, do we want an even more progressive tax system? So, you know, the kind of the line that gets quoted all the time is, you know, the wealthy should pay their fair share, and we can argue about what the fair share is. That's a policy debate. That's okay. But the vilification is the thing. That's just the distraction. And by the way, if you really are being honest about it, we don't have a revenue problem in this country. We already have the most progressive tax system in the world. The top 1% of taxpayers pay 40% of all the tax revenue. The bottom half pay only 3%. We have already, and I think it should be zero. I don't think it should be 3%. I think it should be zero. So we would be making more progressive that way. We actually have a spending problem and that's a skills issue. I mean let me give you an example. The New York City school system, right? They spend $44,000 per student, 44,000. That's 30% more per student than other big cities like Chicago, LA, and Boston. And it's three times more than Miami and Houston. And by the way, New York City doesn't get better outcomes. So what this, listen, let me just say if we ran Amazon the way New York City runs their school system, right? Your packages would take six weeks to arrive. We'd have to charge you $100 delivery fee. And then when the package did finally arrive, it'd have the wrong item in it anyway. We can't. That's a skills issue, Andrew. It's not about, it's just competence.

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Andrew Ross Sorkin6:25

But there's also a question about, you know, there's teachers unions in New York.

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Jeffrey Bezos6:30

None of this money is getting to the teachers. I promise you, if you're charging $44,000 per student, how much of that money do you think is trickling down to teachers? Not much.

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Andrew Ross Sorkin6:40

And so you don't think it's about creating a livable wage for teachers? I mean, that's part of the issue is sort of how do you create this livable...

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Jeffrey Bezos6:46

Wage, by the way, affordability, more of that, more of that they could, that amount of spending should come down and more of it should go to the teachers. It's just if you look at the level of administration in the New York public school system, it's off the charts. It's like they have all these middle managers and senior leaders. The money does not get to the teachers.

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Andrew Ross Sorkin7:07

Let me ask you a question, though, about great wealth, though. And the other issue around on the tax front is whether people of great means at the very, very top end. And Elizabeth Warren has made this point repeatedly. I think she's made it in reference to you and others. Are you able to pay a lower tax rate even though you're paying an enormous sum in taxes, a lower tax rate than maybe I am?

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Jeffrey Bezos7:30

Because people sometimes say that, you know, I don't pay taxes, I pay billions of dollars in taxes. And it's a perfect, again, if people want me to pay more billions, then let's have that debate. But don't pretend that that's going to solve the problem. You could double the taxes I pay and it's not going to help that teacher in Queens, I promise you. So you can't connect those two things, not logically. You know, there are more examples. Why is rent expensive? Why is rent so expensive? I recently saw somebody blamed it on Airbnb. Okay, Airbnb is not the cause of expensive rent. In fact, it's been almost finished here. One second. It's already been outlawed, right in New York City. And rents are still very high. So we know Airbnb isn't causing high rents. What's really causing high rent is government intervention. We subsidize demand with things like tax policy, which is fine, but at the same time, we constrain supply. We constrain supply with things like zoning and permitting. Why does it take so long to get something permitted to build? If you want rents to come down, Econ 101, really simple. You need to, you can't sort of subsidize supply. I mean, sorry, subsidize demand and constrain supply. If you do, prices are going to skyrocket. But this is not anybody's fault other than government policy. And this is fixable. Again, this is a skills issue.

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Andrew Ross Sorkin9:07

Well, let me ask you about government policy, though, because the other piece of the argument is that the wealthy have extraordinary influence over government policy and have too much influence over government policy, by the way, over tax policy, over housing, over all of it.

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Jeffrey Bezos9:23

But what I would say is that we have way too much corporate welfare, way too much corporate subsidies. We have way too much influence in politics from business, in some cases, wealthy people who really focus on that, unions. There's a bunch of people interfering in the political process. And if we can make that better, we should do that too. That would be another root cause. You go back and figure out what is happening there. But yeah, it doesn't make any sense for the government to subsidize certain agricultural crops, certain real estate transactions, Hollywood films. The tax code is 10,000 plus pages long because it has built in corporate loopholes for various things. This is crony capitalism. And of course, it should be fixed.

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Andrew Ross Sorkin10:18

Well, that's my question. And therefore the question is, should people like you and your position advocate ways to fix it? I mean, one of the things people talk about is this policy of what they call buy, borrow, die. This idea that you can take your assets, that you have stock and get...

J

Jeffrey Bezos10:35

Loans, as I know there is. There's no truth to this buy, borrow, die thing. I don't even know where this comes from. And, you know, you can look at, I'm selling Amazon stock routinely. And that's how I fund Blue Origin and Prometheus and a bunch of other things, investments in small companies that I'm doing. So I, every time I sell...

A

Andrew Ross Sorkin10:59

It may not be...

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Jeffrey Bezos11:00

You, I pay taxes.

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Andrew Ross Sorkin11:01

On that. But there are other people, by the way, Elon Musk, who takes extraordinary loans against his stock and as a result isn't paying taxes. In that moment when he sells stock, he pays.

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Jeffrey Bezos11:10

And this is, you know, again, can we fix that? If that's a true loophole? I'm a little skeptical that that's a true loophole. But if it is, can we fix it? Then we should. I don't think such a loophole should exist, but I want to get back to my primary point. When you fix that loophole, it's not going to help that...

A

Andrew Ross Sorkin11:30

It's not going to solve the full problem.

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Jeffrey Bezos11:32

That nurse in Queens, it's not going to help her at all.

A

Andrew Ross Sorkin11:36

Let this. I'm going to...

J

Jeffrey Bezos11:38

And so that's what you've got to bring it to. You know, if you really want to have a progressive tax system, you also want that money to actually be helping and not just dissolving in, you know, administrative bureaucracy and not even getting to the teachers.

A

Andrew Ross Sorkin11:56

But part of...

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Jeffrey Bezos11:57

It is, is there's bad outcomes. 70% of the New York public city school kids in eighth grade are at their reading level, 70% only. It's like it's actually 72%, 28% are there.

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Andrew Ross Sorkin12:10

Well, let me ask you about the anger, because there seems to be anger, at least from certain political sides of this. And AOC recently said in a podcast, I'm just curious how you think about this, says there's a certain level of wealth and accumulation that is unearned. She says you can't earn $1 billion, just can't earn that, she says. You can get market power, you can break rules, you can abuse labor laws, you can pay people less than what they're worth, but you can't earn that. Yeah. By the way, you've earned extraordinary amount of money. You employ largest employer, if not one of them in the whole country. When you read that, what do you think?

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Jeffrey Bezos12:51

Well, it's not correct on its face. Let me give you a simple example. Let's say you start a burger joint and you have ten employees and you make a little bit of money, right? Until you have this is one outlet. And by the way, these are the most delicious burgers in the world. People love your burgers, Andrew. And so then you open a second outlet, right? And now you're making a little bit more money and you have 20 employees and you open a third outlet. By the time you've opened 1000 outlets, you are a billionaire, right? And by the way, this is a real life story. It happens all the time. It's In-N-Out Burger. It's, you know, Raising Cane's Chicken. At what point did that money all of a sudden become unethical or it didn't? There was one outlet, and then there were two, and then there were three. The way you make $1 billion or $100 million or $10 million or anything, is you create a service that people love. And if millions of people choose your service, you're going to end up with $1 billion, right? And you can, you know, just try it with a chicken franchise.

A

Andrew Ross Sorkin14:03

Do you think...

J

Jeffrey Bezos14:04

Your chicken has to be good?

A

Andrew Ross Sorkin14:05

But there's the question of whether the people who are working at the burger joint ultimately should be paid more, that that's what creates the affordability gap.

J

Jeffrey Bezos14:14

Well, by the way, that's also if you want to change the minimum wage, change the minimum wage. Amazon, we have our entry level wage for in Queens is $23 an hour. And that works out to be like $52,000 a year. And this is an entry level job that doesn't require any educational attainment. It doesn't require any preexisting skills. We will train you. It's actually a great first job. On day one, you get full health care, the same health care program that our senior executives get, the same one I'm on. And so this is actually a fantastic entry level job, $23 an hour. But guess what? They're still charging that person more than $10,000 in taxes. And you think that's absurd, right? Why would you charge somebody making $52,000 a year, $10,000 a year in taxes? It doesn't make any sense. Let them be. You know what? That person has a chance to uplift themselves and to uplift their family, and to learn more skills. But like, why are you taxing them so much? I really am puzzled by this. You know, the more I think about it. Why? Well, you don't need that revenue.

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Andrew Ross Sorkin15:30

The pieces that we have a big budget gap. And so whether you're the federal government or whether you're a city, I mean, I was going to ask you about what you thought of the terror attacks in New York and what you thought of what happened with this Ken Griffin video that the mayor made? Well, you have a place in the city.

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Jeffrey Bezos15:49

Yeah, there's two different, I think there are two different things about that video. On the one hand, it's perfectly fine to have a policy debate about whether you want to have a terror tax. Right. The second piece, which is not so good, is to go stand in front of Ken Griffin's house and act like he's some kind of villain. Ken Griffin isn't a villain. He hasn't hurt anybody. He's not hurting New York. In fact, quite the opposite. And so that piece of it isn't right. And there was no reason to do that. A tax is a, you know, there's taxes on out of towners are very popular taxes. That's why there are hotel taxes. And hotels always have very high tax rates because why not tax the tourists? And there are limits. If you raise the hotel taxes too much tourists stop coming. Right. So you have to be judicious. But I think that the tax is a fine thing for New York to do. And, you know, they have to figure out. But it's a policy debate, right? Policy debates don't have to be finger pointing. This is the piece.

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Andrew Ross Sorkin16:57

And so you're not going to sell your place.

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Jeffrey Bezos17:00

Unfortunately. It is an effective political technique. It's as old as the hills. So when you don't know how to solve a problem, create a villain, blame them, but it won't solve the problem. The only thing that will solve the problem is skill, right? And so really it's a skills issue. You want to say any corporate CEO, CFO worth their salt? Amazon CFO could find 3% in the federal budget on a Tuesday afternoon. There is so much waste in government spending.

A

Andrew Ross Sorkin17:32

What do you think personally? I mean, you read these headlines. You see your name in them, whether it's the Met Gala protests. Yeah. On a personal level, what do you personally think of all this? I know we're talking about policy.

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Jeffrey Bezos17:46

Well, on a personal level, you know, I think of my parents and I think of how they uplifted me. I think of where they started. I think, you know, my dad is a Cuban immigrant. He came to this country right after Castro took over, and he was a 16 year old boy who didn't speak a word of English. He came all by himself. His parents weren't allowed to leave. He was in a refugee camp in the Everglades, and he built himself up. My mom had me in. She was in high school. She was a 17 year old mom. You know, it wasn't cool to be a pregnant mother in high school in Albuquerque, New Mexico, in 1964. And she brought herself up. And so I look at that and I think, you know, I want to make sure that the people who are struggling today have a chance to do that too, to bring themselves up. And maybe, you know, maybe they're going to be the next Steve Jobs, maybe they're going to be, you know, maybe one of their kids will be the next Steve Jobs, I don't know, but we can give them a better chance by eliminating their tax bill. I don't want to reduce it. I want to eliminate it. I think there's something very powerful about zero. You know, like zero is a better number than like $1. You know we don't charge. We have free shipping at Amazon. Not like $0.25 shipping. Zero is a good number. When people are starting out and they're struggling, stop taxing them. We don't need it. We live in the wealthiest country in the world. America is the greatest country in the world. We have more entrepreneurial dynamism here than anywhere else in the world. This is the best time to be alive in America because we have access to capital is so easy right now. It's so good. And I'm talking about entrepreneurs and aspiring entrepreneurs. And that's we should have so much optimism about the future.

A

Andrew Ross Sorkin19:43

Okay. Well, I want to talk about some of that optimism because there are some people who are very fearful, by the way, about AI.

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Jeffrey Bezos19:48

I'm very aware of this, and I think those people are dead wrong.

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Andrew Ross Sorkin19:52

We'll get into that in a second. But do you have a relationship with the President, President Trump, now that you have this, I don't know if this is a policy position, the Bezos policy position for zero taxes. I don't know what the wealth number is going to be. Do you plan to go to Washington to talk about this with them? I mean, is this something you want to be the advocate for?

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Jeffrey Bezos20:10

I'm certainly going to advocate for this. You know, I've worked with every president since Bill Clinton, and I hope to work with, you know, the next couple of presidents, too, if they'll have me. But yeah, we have, it's part of our job as citizens and as business leaders to share our ideas. And this one would actually help people. This one would actually help people.

A

Andrew Ross Sorkin20:33

Let me ask you a social compact question between wealth. I mean, part of this is a social compact issue between the wealthy and the less wealthy. And, you know, I don't know if you saw about a year or two ago, Warren Buffett wrote a fabulous letter where he said they always thought he was rich, but he never imagined that people were going to get as rich as Carnegie or Rockefeller. And he thought they would never imagine they'd get as rich either. Those people gave away extraordinary amounts of money. They built libraries, they built schools, all of it. You've talked about giving your wealth away some $280 billion of it mostly during your lifetime. Yeah. You're 62 years old now. Warren Buffett has said how hard it is to give money away. Yeah. He's not even sure that his kids in their generation are going to give away. He's already starting to prepare to find another, the next generation to give it away. Yeah. How are you going to do it?

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Jeffrey Bezos21:22

Well, I give away billions of dollars to charitable causes. And I'm going to continue to do that. I'm going to give away most of my wealth in my lifetime.

A

Andrew Ross Sorkin21:33

But that's going to be hard. But you have to give...

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Jeffrey Bezos21:35

A lot of ways. It's hard and it's also hard to do well. It's easy to do poorly. Right. And what you, in my view, you don't want to create dependence with your wealth. One of the things I find that I really, really like is family homeless shelters. I give about $100 million or so every year to 30 or 40 different family homeless shelters. These are usually women with children. The motto that I have is no child sleeps outside. And these are I really like these because they build independence. So the average stay in these shelters is usually less than 180 days. They teach people skills. They teach people how to interview. They teach a bunch of things because mothers with kids, usually mothers with kids, sometimes fathers, but usually mothers with kids, they really do want to stand on their own two feet. So like when you start talking about charity, one question I would encourage anyone to ask is thinking about doing charitable giving is, does this giving create dependence or independence? And you want to do things that create independence.

A

Andrew Ross Sorkin22:39

How are you going to do that at scale? I mean, $280 billion and maybe more.

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Jeffrey Bezos22:43

One more thing about this. I don't know yet the answer to your question. This is a very difficult thing to do, and it's going to take a lot of focus and work. But I want to make one more point here, which I think is really important, even though I'm going to give away the majority of my wealth if I do my job right. The value to society and civilization from my for profit companies will be much, much larger, right? Than the good that I do with my charitable giving. And I think this is an important point to make because people forget or they sometimes don't see that when you create something like Amazon and you're saying, I get letters from new mothers all the time that say like, I have no idea what I would be doing right now if I didn't have Amazon, thank you. Or what we did in the pandemic, when people could really see what an essential service we provided to them. And so, you know, this is where Amazon creates tremendous value. And by the way, all companies are creating value of some kind. That's why people are voluntarily giving them money, right? You know, nobody is forcing somebody to use a particular product. You're choosing to do it because that product is giving you value. And so if you create a company, Blue Origin will create tremendous value for the world. Prometheus will create tremendous value for the world. Amazon has already created tremendous value for the world, and I hope it will continue to create even more. It's not just the consumer side, it's with AWS too. But this is such an important point. You know, I really want people listening to this to think about that, that for profit companies properly run are a tremendous value for the world. And they're self-sustaining and they draw competition. If you can do something with the for profit model, you should. And then if you can't figure out, there are market failures where it's just not going to work. If you want to do room temperature vaccines, you know, there's not a big market for that because wealthy countries have refrigeration. And so there are market failures where you really can't, you know, there's no real market for family homeless shelters. Do you see what I'm saying?

A

Andrew Ross Sorkin24:59

But let me...

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Jeffrey Bezos25:00

But for most things, there is a market and you should do that. And you are creating tremendous value that way. And so everybody out there who's a potential entrepreneur, right? Make sure you focus on that. You will be creating value for society if you're successful at pleasing your customers.

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Andrew Ross Sorkin25:15

Okay. Talking about markets. Yeah. I was asking you about the news market. Yeah. Because you own The Washington Post. Yes. And one of the critiques, by the way, and this is maybe the wealth critique and everything else is, you know, we just you, the company laid off about 30% of its staff. Yeah. And there's a lot of people out there who said, Jeff's super wealthy. He's talked about this being a public trust. That's something that he bought early on. How much you care about that piece of it? Why? Why lay people off? Why fire people? Why don't you subsidize the business if in...

J

Jeffrey Bezos25:50

Fact, because the Post needs to be a profitable enterprise that stands on its own two feet. It needs to be. But yes.

A

Andrew Ross Sorkin25:57

That's the question. Some people say it should be...

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Jeffrey Bezos26:00

A trust. And let me tell you why. Okay? Because it's a measure of its relevance. If people won't pay for our product, we're not doing, it's not good enough product. It's like, you know, doing it would be like poetry without rhyming. It's too easy. So we want it's got to be something that people will pay for because that's a signal, right? It's a signal that we're providing a relevant service. Your paper, The New York Times. You guys make a ton of money. You guys are doing very well financially, and you're providing a service that people are willing to pay for. We can do that too. And guess what I told them when we were planning those layoffs, I didn't pick who was going to get laid off or which departments. I said, follow the data, follow the data. And I said, there's one exception to this. What's that? Don't follow the data on investigative reporting. The heart of the Post is investigative reporting. And guess what? Our newsroom today, even after the layoffs, is still larger than when we did Watergate and the Pentagon Papers. And so and we just won the Pulitzer Prize for Public Service, the most prestigious prize, but most prestigious Pulitzer for our investigation into DOGE. So the Post is going to continue to be an important institution. And in fact, it's going to be a more important institution because of this financial discipline. It needs to be relevant to readers. It needs to stand on its own two feet. I don't want it to be a charity. It doesn't need to be.

A

Andrew Ross Sorkin27:31

And it shouldn't be. Do you want to own it? And the reason I ask is you've talked about how you are by default, to some degree, a conflicted owner given you own all of these other businesses.

J

Jeffrey Bezos27:42

I think an ideal owner... yes. My vision is still to make sure the post is... when I bought the post, it was very unprofitable. The newsroom was even smaller than it is today. We turned it around in two years, was profitable for six years. I put all that money back into the post, grew the newsroom. We've shrunk it back somehow, but we haven't shrunk it back to what it was when I bought it.

A

Andrew Ross Sorkin28:12

And so what do you think went wrong then? I mean, you had this super successful period.

J

Jeffrey Bezos28:17

Yeah. What went wrong is we did not adapt. So this is what the news business... if you go back to the 90s, the local monopoly newspaper was the greatest business in the world. It was the printing press. The Washington Post had 70% of households in the Washington metro area, and it made money hand over fist. We live in a completely different environment now. It's nothing like it. You have to work hard to make a living in the news business.

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Andrew Ross Sorkin28:47

Let me ask you one related question to all of this. This goes to the Washington Post piece of it, and just the influence and money piece of it. It relates to the President of the United States. There is a view among critics that say that part of what you have done or are doing is trying to placate the President with either the shift in the tone of what's happening at the paper or even some of the things that Amazon did, the decision to make the documentary around Melania, for example.

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Jeffrey Bezos29:16

Yes, the Melania thing is a falsehood that will not die. I see reported all the time that somehow I was involved in this, at this Mar-a-Lago dinner.

A

Andrew Ross Sorkin29:30

Everybody thinks that you went to Mar-a-Lago.

J

Jeffrey Bezos29:32

Not true. We have denied it. Melania's office has denied it. It's not true. I had nothing to do with that. By the way, it appears that it was a good business decision. That did very well in theaters, it's done very well on streaming. People are very curious about Melania. So even though I had nothing to do with it, it appears that the Amazon team made a very wise business decision. I also had nothing to do with Project Hail Mary, which I regret because it's an incredible success. I wish I had greenlit that, but I didn't. Amazon is a big company, it makes a lot of decisions. But this idea that somehow that is a way of buying influence is just not correct. I can see why people say this. And by the way, the same thing at the Post. I want the Post's opinion section to stand for free markets, kind of what I've been talking to you about today: free markets and individual personal liberties. I think those are founding pillars of America. It's one of the reasons that America has been so successful. In 1917, we had the same GDP per capita and the same population size as Argentina. Those two countries diverged completely. And it's because of our system, the way that we have organized ourselves to be productive. Business can do that, you know, and they can be interfered with a bit. But there's a limit. If you interfere too much with too much regulation, the golden goose that lays the golden eggs can stop laying golden eggs. You don't want that to happen. This is the engine. You want to make sure everybody is sharing in that engine, but don't hurt the engine. Does that make sense?

A

Andrew Ross Sorkin31:30

Completely. When I last interviewed you, it was about two years ago. President Trump had just won. He was not the president yet. And I had asked you what you thought of him at the time, and you said that you thought he had mellowed, that he was calmer. And I'm curious now. Here we are, two years later. We've had lots of wars and tariffs and all sorts of things that have happened since then. What do you think?

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Jeffrey Bezos31:56

I think he has... I mean, I'm comparing him to his first term. And I think he is a more mature, more disciplined version of himself than he was in his first term. I've worked with all the presidents. I will work with all the presidents, and I hope to do that going forward if they'll have me. But we need our business leaders to provide input into the administration, regardless of who the president is. I'm not on the side... you know what this is? I'm on the side of America. And that is so important. And that's where business leaders should be.

A

Andrew Ross Sorkin32:39

I think...

J

Jeffrey Bezos32:39

They're not. No, I think we are, but we get perceived as being partisan or whatever. Like I was helping Obama every chance I could. I was helping Biden every chance I could. I still call Obama for advice. He's a very smart guy. And by the way, Trump has lots of good ideas and he's done a lot of things. He's been right about a lot of things. You have to give him credit where credit is due.

A

Andrew Ross Sorkin33:09

Let me pivot this whole conversation to space, because we haven't really gotten there. And here we are, it's a mecca of sorts. It's really a remarkable...

J

Jeffrey Bezos33:19

It's amazing. What you're looking at here is billions of dollars of investment. And it's also employing 14,000 people. And it has an unbelievable future. It's very exciting.

A

Andrew Ross Sorkin33:35

So you've talked about...

J

Jeffrey Bezos33:38

By the way, I want to make one more point before we move to Blue. I thought of something. One of these things that you asked me at the very beginning, like, where does this anger come from? And I said it's a tale of two economies. And I think that really is what's going on. But there are also some deep misconceptions that are worth people thinking about. A lot of people don't understand the kind of zero-sum fallacy. They think that if there's a bunch of wealth over here, that it's a fixed pie. We've got one pizza and there are seven people and there are eight slices. Who's going to get two slices? That is not how economies work. It isn't a fixed pie. It grows. People's mental model is that wealth is like water in a drought or food in a famine. You can hoard food in a famine, you could hoard gasoline in an energy crisis, you could hoard water in a drought, you could hoard toilet paper in a pandemic, as people did. But you can't hoard investment. If you have stock in a company, that's not hoarding, that's investing. And investing is more like farming. And you would definitely want to farm in a famine. Do you see what I'm saying? This, the billions of dollars of investment that have come here have come from that Amazon stock. And by the way, when I sold that Amazon stock, I paid capital gains on it.

A

Andrew Ross Sorkin35:27

You were early when you talked... I remember talking to you maybe 10 years ago, 15 years ago, and you were talking about putting infrastructure in space. And I think you were even talking a couple of years ago about putting data centers potentially in space, before Elon was talking about data centers in space.

J

Jeffrey Bezos35:45

Yes.

A

Andrew Ross Sorkin35:46

How realistic is that really? What's the timeline of that? Because right now there's a lot of excitement around the space IPO in particular, because of this view that we're all going to be moving stuff to space.

J

Jeffrey Bezos35:58

The question 'are data centers in space realistic?' The answer is yes. The timeline is harder to answer. Some of the timelines you hear are very short. They're probably not. People who talk about 2 or 3 years, that's probably a little ambitious. I think what Elon would tell you is if you don't set an ambitious timetable, if you want it to be six years, say it's three. That's the kind of... exactly how long it will take. I don't think anyone knows. But it is real. It will happen. A couple of things need to happen for that to happen. Energy needs to become a bigger percentage of the cost of terrestrial data centers. Today, terrestrial data centers typically spend less than 15% of their total cost of ownership on energy. And the biggest advantage to being in space is that the energy is free. You're getting solar energy 24/7, no clouds, no weather. 15% is not a huge number. So I predict over time the energy budget of a data center will go up. The chips will get a little cheaper. Right now, the chips are so expensive that the energy is not a big chunk. So that will probably change. And then the second thing is that launch cost has to come down very significantly, by a factor of ten. That's what we're working on right here. That's what Blue Origin is doing. This team is on fire doing that. We have a new CEO named Dave Limp, and he's doing a great job. This whole leadership team is doing a great job. I'm very proud of them.

A

Andrew Ross Sorkin37:47

If you're right about the data center piece though, getting to space, does that change the equation for all the investment that's going on in data centers terrestrially on the ground right now?

J

Jeffrey Bezos37:58

No, I don't think so. Because again, the timeline is very different. And you're going to need as much terrestrial data center capacity as you can arrange in the near term. This technology is real. And you know, I mentioned my optimism a minute ago, and we should definitely talk about that, because there are so many people who are afraid that AI is going to take their job. I think that there's going to be a labor shortage as a result.

A

Andrew Ross Sorkin38:29

So let's go there then. I wanted to stay in space, but let's go to that.

J

Jeffrey Bezos38:33

Because we can come back. We can be in space too. Whatever you want, Andrew.

A

Andrew Ross Sorkin38:37

That's fascinating. I don't know if you saw Eric Schmidt gave a commencement address over the weekend. The students were booing because every time he mentioned AI, they were deeply fearful and worried about whether they're going to have a job.

J

Jeffrey Bezos38:53

Yeah. The reason they're afraid of that is because all these smart people keep saying that. So there are many smart people, and they are smart, and they are saying, 'Oh my god, there's going to be no more radiologists because AI can read X-rays better than a radiologist can, and there's going to be no more software engineers because AI can program better than a software engineer can.' These people are wrong. So what's really going to happen is that it's going to elevate all of these people. It's like you've been digging out a basement for your house with a shovel, and somebody is about to hand you a bulldozer. You should be so happy. What's really going to happen is we're going to have so much productivity in our economy that, for example, a lot of people who have two-earner income households, one of the people is going to drop out of the workforce. That's why we're going to have a labor shortage. Because of the productivity gains, you're going to be able to afford things. I predict we will actually have deflation of certain core items, assuming we let this technology play out and don't hamstring it with regulation too early. We will actually have things like food get cheaper, housing construction get cheaper, and so on.

A

Andrew Ross Sorkin40:33

And so on. Is there a transition cost?

J

Jeffrey Bezos40:36

We could even solve the permitting problem I was talking about earlier for housing. When you are a builder, why does it take you six months, nine months, two years, five years, depending on what municipality you live in, to get a building permit? I should be able to do that in seconds, not... it should give you a yes or no in seconds. And then you should have your authority to build it. If it says no, it should give you the six reasons why. And then you go change those things and resubmit, and you start building tomorrow instead of two years from now.

A

Andrew Ross Sorkin41:10

But how do you answer... I mean, Amazon laid a whole bunch of people off. You heard Mark Zuckerberg...

J

Jeffrey Bezos41:15

Because of AI.

A

Andrew Ross Sorkin41:16

Mark Zuckerberg recently laid a bunch of people off.

J

Jeffrey Bezos41:18

Is that because of AI?

A

Andrew Ross Sorkin41:20

Jack Dorsey ascribes it directly to AI.

J

Jeffrey Bezos41:23

Well, you'd have to talk to Jack about that. I don't know. He must have had a lot of extra people. The reason we're not seeing those same kinds of things...

A

Andrew Ross Sorkin41:31

The reason that people are talking about this is in the context of coding right now, and also in the context that for these companies to have the extraordinary valuation that we're talking about, they have to create extraordinary productivity gains.

J

Jeffrey Bezos41:42

Can I give you a different lens to view this? So if I'm a software engineer, I need to uplevel and think to myself, what am I really doing? What software engineers really do is we identify problems and we help solve them. The code is almost just a piece of execution that helps with that. But the real job is going to be identifying problems and helping to solve them. Does that make sense?

A

Andrew Ross Sorkin42:19

Totally.

J

Jeffrey Bezos42:19

And that's not going to go away. That's the kind of thing that humans are going to be good at, is figuring out, okay, we want this, and they're going to work with that tool to build the system. Humans are never going to run out of problems, and we're never going to run out of the need for solutions. The work is going to be done at a higher level. It's going to be done with a bulldozer instead of a shovel, and that's going to be a good thing.

A

Andrew Ross Sorkin42:45

It's an argument, or there's a concern about the white-collar workers on one end. And then I was going to mention you have a new company called Prometheus. That is really about AI robotics.

J

Jeffrey Bezos42:54

No, it's not surprising, but we haven't said much about it, and I can't say much about it today either. It's a little premature for me to talk about it. But we have nothing to do with robotics. What we are doing is building an artificial general engineer. So when you go to design something, we want to build tools that make it much easier for engineers to design physical objects. You've heard of CAD and computer-aided design. This is a very, very modern version of that. I'm really oversimplifying here, and it's premature for me to give much detail about Prometheus. Prometheus is something I got so excited about that I became the co-CEO of the company, putting a lot of time and energy into it. It's going to be amazing. As I say, ten-thousand years ago, somebody invented the plow. The whole world got wealthier. The root of civilizational wealth is invention. Somebody invented the plow. We all got wealthier. Somebody invented the steam engine. We all got wealthier. That's how this works.

A

Andrew Ross Sorkin44:13

And you don't think this time is different?

J

Jeffrey Bezos44:15

No, it's not different. It's even better. And by the way, not only that, these people should not be depressed. They should be energized, because this is a moment when the possibilities are so large. Just keep your eyes open to those possibilities.

A

Andrew Ross Sorkin44:33

Sam Altman talks about the need for universal basic income. There's a question about the concentration of wealth.

J

Jeffrey Bezos44:41

Instead of universal basic income, how about we stop taxing nurses who make $75,000 a year? We don't need to give her universal income yet. Let's just stop taking money away from her.

A

Andrew Ross Sorkin44:55

Let me go back to space for a second, because I'm so curious. Well, let me ask you one question about Prometheus. I know you can't go too far on it. I'm curious how you decide. You're now the CEO of that company, co-CEO. You oversee this. I know Dave Limp is running day-to-day. You're the executive chair at Amazon. How do you decide with Prometheus? How much time do you spend on that versus all these other things? And also, did you ever say to yourself, 'I'll put Prometheus inside of an Amazon or inside of a Blue Origin'?

J

Jeffrey Bezos45:29

What I do, my through line for the last few years has been AI. I've been on the machine learning track for 15 years. Amazon has made incredible use of machine learning. But a few years ago, we had a real breakthrough in machine learning, and we call that AI. It has so much potential. My time at Amazon is spent on AI. My time at Prometheus is spent on AI. Prometheus is really an AI company. My time at Blue is largely spent on AI. And the tools that we're building at Prometheus are going to help companies like Blue immensely.

A

Andrew Ross Sorkin46:12

But rather than do it inside Blue or rather than do it inside one of the others...

J

Jeffrey Bezos46:16

It deserves its own special focus. It's its own big idea. You can get a lot of focus by having a separate company.

A

Andrew Ross Sorkin46:27

SpaceX is going public, potentially at a $1.75 or $2 trillion valuation. There are a lot of people here who have stock in Blue that are very excited about that. What do you think about that valuation? Does that make sense to you?

J

Jeffrey Bezos46:44

I don't know enough about their financials to have... maybe their S-1 is going to come out tomorrow or something, and maybe we'll have a better view of the company at that point. It's hard to know how much of it is based on the financials and how much of it is a bet on the future. One thing I can tell you for sure is that space is going to be a gigantic industry.

A

Andrew Ross Sorkin47:20

We are back on the factory floor here of Blue with our exclusive interview with Jeff Bezos. Jeff, what are you holding? I wanted to see what that was. You had it on the side there before.

J

Jeffrey Bezos47:31

This is a solar cell that we at Blue Origin made out of lunar regolith. Lunar regolith is the dust on the surface of the moon. This is lunar regolith simulant. It has exactly the same composition as lunar regolith. We're working on building solar cells out of lunar regolith. Lunar regolith fortunately has a lot of silicon in it. This is an actual solar cell that we produced with lunar regolith simulant.

A

Andrew Ross Sorkin48:08

And will this be on things that are ultimately on the moon or just in space?

J

Jeffrey Bezos48:12

It could be both. Ultimately, you may build data centers on the moon and power them with solar cells that you make on the moon. Alternatively, you can make the solar cells on the moon and then fling them into space in various ways and build data centers in space, with materials from the moon. If you use materials from the moon, you're accomplishing a couple of things. One, it's much more efficient to lift things off of the moon because the moon's gravity is very low. It takes 28 times less energy to lift a kilogram off the moon than it does to lift it off the earth. And secondarily, it's the beginning of the process of moving heavy industry off earth. This is the garden planet, and we want to keep nature here the way it is.

A

Andrew Ross Sorkin49:03

What's the timeline for you? You talk about lunar permanence, creating permanent working environments on the moon.

J

Jeffrey Bezos49:13

With NASA, we will be building a lunar base on the moon. Blue Origin has a big contract with NASA to build a lunar lander. NASA is in the process of getting additional contracts. NASA is really focused on the moon now. I've been focused on the moon for a really long time and have been saying, 'Let's do the moon, and then we'll do Mars.' Step by step, but do the moon first. The moon is a gift. It has all these resources. It has water. It has eternal peaks of light. We can build a whole bunch of things on the moon.

A

Andrew Ross Sorkin49:49

The economics, though, for this business, at least in the short term, are about satellites.

J

Jeffrey Bezos49:54

It can be about satellites and data centers. Amazon has LEO and Kuiper. Blue Origin has two constellations in work. One is called Terra Wave. It's a communications constellation with very high bandwidth. It serves a limited number of customers, but with very high bandwidth, focused on government customers and big enterprises, hyperscalers. Then we have another constellation called Sunrise. Sunrise is our data centers in space constellation. For now, most of these things are focused on low earth orbit constellations. Then there's a third thing, national defense. The US has always enjoyed a strong superiority in space. That's something you really do want to continue for U.S. national security. We also focus a lot on that.

A

Andrew Ross Sorkin50:58

There are all sorts of wild things we hear about things that could happen in space. The idea that you could put mirrors in space that would project the sun down 24 hours a day to power solar, for example. I don't know if it's 10 years, 20. What do you think the timeline is where all of a sudden our kids are going to either be in space or be impacted in a meaningful way by all of this?

J

Jeffrey Bezos51:20

I would argue you're already impacted meaningfully by space. You have been ever since we had weather satellites. Hurricanes don't sneak up on you anymore. Ever since we have had weather satellites, we've been in a way better position. Same thing with communication satellites, which we've also had for many decades. Space has been a factor. It's also been a factor in national security for many decades. But that's accelerating. You see it with Starlink, the constellation that SpaceX has launched. You're going to see it with Kuiper. But your timeline question... it's going to be a gradual thing, but 100 years from now, you won't believe what has happened. The best way to think about 100 years is to think about Kitty Hawk. What happened from that little Wright Flyer that flew a few hundred feet? It wasn't very many decades before you had a 747. I would caution people who think it's all science fiction to be a little cautious with their judgment, because it is real, it is happening, and it's probably going to happen faster than most people think.

A

Andrew Ross Sorkin52:35

Dave Limp, who runs Blue for you, there was a memo that leaked to the Financial Times. You're thinking of taking outside money for the first time. So when's that going to happen? What does that look like?

J

Jeffrey Bezos52:46

We finally have enough visibility into our future and our financial success that I've funded Blue out of my own pocket by selling Amazon stock to fund Blue. But it's a good time to start thinking about the future and bring on some other outside investors. We're considering that.

A

Andrew Ross Sorkin53:08

So it hasn't happened yet.

J

Jeffrey Bezos53:10

It has not happened yet.

A

Andrew Ross Sorkin53:15

You've been through a bunch of economic cycles, including 1999, when there were a lot of questions about whether Amazon was going to continue. I'm curious where you think we are now in this economy, because there is a lot of excitement around AI, around space.

J

Jeffrey Bezos53:36

We're in a phase where every experiment is getting funded. What that means is the good ideas are getting funded and the bad ideas are getting funded. It's because investors at this moment haven't learned yet how to discriminate between good ideas and bad ideas. That's okay, because the good ideas will pay for all the losers. From a point of view of civilization, these kind of industrial cycles can actually be very healthy because they drive the technology forward.

A

Andrew Ross Sorkin54:15

So we shouldn't worry about being in a bubble.

J

Jeffrey Bezos54:18

No, even if it does turn out to be a bubble, you shouldn't worry about it because the bubble is driving investment, and a lot of the investment is going to turn out to be very healthy. It's like the biotech bubble when it burst in the 1990s. A lot of investors lost money on certain things, but we...

full interview with Amazon founder Jeff Bezos

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