Better Offline - A Nobel Economist's Plan To Tax Digital Ads

Episode Date: October 30, 2024

In this episode, Ed Zitron is joined by Daron Acemoglu, MIT Economist and recent winner of the Nobel Prize in Economics, to talk about his daring - and likely effective - plan to tax all digital advertising revenue over $500m at 50% as well as how we might adjust incentives to bring big tech under control. PAPER: https://shapingwork.mit.edu/research/the-urgent-need-to-tax-digital-advertising/  --- LINKS: https://www.tinyurl.com/betterofflinelinks Newsletter: https://www.wheresyoured.at/ Reddit: https://www.reddit.com/r/BetterOffline/  Discord: chat.wheresyoured.at Ed's Socials: https://twitter.com/edzitron https://www.instagram.com/edzitron https://bsky.app/profile/zitron.bsky.social https://www.threads.net/@edzitronSee omnystudio.com/listener for privacy information.

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or potentially a great run into the semifinals. Listen, Inside American Soccer with Tom Bogart and Tab Ramos on the eye heart, radio app, Apple Podcasts, wherever you get your podcast. Call Zone Media. Hello and welcome to Better Offline. I'm your host, Ed Zittron. Back in March of this year, MIT Economist, Darone, Asamoglu and MIT Sloan Simon Johnson,

published a paper called The Urgent Need to Tax Digital Advertising, where digital advertisers will be levied with a flat tax of 50% on all revenue above $500 million. And today I'm joined by Daron to walk through it. Daron, thank you for coming on. Thank you. Thanks, Ed. It's my pleasure.

So walk me through the idea. It seems pretty simple, but maybe there's more nuance to it. Well, it's very simple to implement. It's very simple to explain. The question is why. You know, why do something like this? You know, after all, who doesn't love something free? And we're getting a lot of free things because the entire online ecosystem is monetized via

digital ads. Right. The issue is, I think this ecosystem creates a number of problems which are set to get worse with AI. Right. The most obvious of those is something that's been discussed quite a bit over the last few years, which is that monetizing via digital ads means that you are going to, encourage platforms to collect more and more data about people.

And this creates a much more intrusive, lower privacy, and potentially distorted sort of system. Right. The second, perhaps corollary or separate thing, which has started receiving more attention, is that this also means you want to make sure that the eyeballs are glued to the screen whichever large screen, small screen.

And that itself might generate a lot of other problems, including perhaps mental health problems, because you try to get people to stay on the platform by inducing strong emotions, envy, jealousy, anger, outrage, and so on. And sort of it creates a very different type of social environment than we are used to with widespread negative consequences. But I think the one that I'm most worried about is that this reduces competition. Right. It is impossible today for any service by a newcomer to come in and say,

okay, you're going to get this from Google, Facebook, Instagram for free, and I'm going to provide higher quality content for which you have to pay a subscription fee or something else. especially difficult because newcomers are not going to have the network. There's going to be uncertainty about their quality. So it really cements a system where everything is going to be monetized via digital ads. And that's going to discourage the entry of new products, new services, and especially new technologies. For example, everybody worries about what social media and other online platforms and AI will imply for democracy. Well, something that actually creates more pro-democratic conversations, higher quality content,

that's going to be very difficult to get off the ground today. Right. So how does this tax actually change the incentive, though? Well, I think the main way in which it changes the incentives is that it makes it possibly more likely that both existing platforms and new platforms will now say, let me experiment with new products that are higher quality for which I can build a clientele via subscription fees or other things. Because if I get $100 million via digital ads,

half of it is going to go away. If I can get that money for our subscription fees, that's good. It's no longer so inferior to doing it via digital ads. But I think one of the things that concerns me with it, or maybe it's less of a concern and more just, the after effect will be, is that people are used to not paying for social media. That's why this needs to be high.

If this was a 10% tax, it wouldn't make so much of a difference. So in some sense, when I mentioned ecosystem, I was intending to imply by that both what the offering side, the platforms are doing and what the consumers are expecting. So there's a synergistic relationship between users' consumers and the firms. And you want to change that relationship. Again, you wouldn't want to do it if the market system was working perfectly and everything was hunky-dory. But I think there's a lot of evidence that's not the case at the moment. So, and the incentives would be that they just can't make that much money off of digital ads so they will have to find new business lines. But could this not

potentially kill off the idea of the free social network? Well, first of all, I think that idea has become excessive. If we scale it back, it wouldn't be so bad. And in some sense, I think the purpose is to scale it back because once everybody expects everything for free, that does create a race to the bottom in terms of quality,

in terms of data protection, in terms of new technologies that will actually change the face of the kinds of offerings that we get. Right. And it's, I remember in the past we've had companies try paid social networks and it just hasn't worked. Well, it didn't work because they were up against free social networks, digitized, so it monetized via digital ads, especially at a time when people didn't understand what the costs of these things were. You know, I think even today, there are consumers who do not fully recognize the amount of data that's being collected about them. So if you go back 10 years ago, I think both the sort of addictive or quasi-addictive nature of social media,

the extensive data collection and how that data can be used both to guide you towards certain products, perhaps to behaviorally manipulate you, or perhaps to charge you higher prices, all of these things were not completely understood. And I get what you mean. it's like the the latest stage model of Instagram and Facebook is so different because when everything's free, you don't really have a mechanism to control the customer other than just tricking them, just continually manipulate. I mean, I'm not going to say.

Tricking is probably the wrong word. There is tricking. There is tricking. It's not everything. So, you know, when you get an ad, it's useful. Right. We're finding out about products. But what is the tradeoff?

between how much of your private data you want other people to have access to versus getting some of those products. And second, once people, once platforms have access to that data, what is there to stop them from offering some of the manipulative products as well as some of the useful products? Another podcast from some SNL late-night comedy guide, not quite. Unhumor me with Robert Smygel and friends,

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Is there anything to the idea that because you're from Harvard, you only got in because your parents made a huge donation. The group. The yard birds, right? That's the name. The Harvard Yard. They're open to change. Do you have a name suggestion?

We're open. since you guys are middle-aged. One erection. Listen to humor me with Robert Smigel and Friends on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. Humor me! I need some jokes to make me seem funny. Run a business and not thinking about podcasting, think again.

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Now, I'm not saying that you're suggesting you should kill META. I'm just saying that META's for the last four quarters, their net income was $51.35 billion off of $130 billion worth of revenue. So this would make their business model untenable, is that... Well, first of all, no, I mean, you know, instead of $50,000. $55 billion, if they make $30 billion, it's not the end of the world. I would be happy to have a company that is worth $30 billion. Oh, as would I. But the hope is that they would also then offer products and services that are higher quality

that are subscription-based. You know, we know people still, you know, pay for certain things, although less than less, like Netflix. Netflix is also now being sort of being forced to move more in that direction. You know, is there a world in which higher quality Netflix for which some people pay is viable? Well, whereas, you know, some lower quality one, finance via, monetized via ads also coexist. I think those are questions. And I think it sort of opens up the market system to different, different.

sort of forces. So if there is a paid WhatsApp that has better security features and you don't get these completely unexpected, annoying things that have started popping up in WhatsApp, perhaps that's attractive. Some people will be happy to pay $10 a year for that. Kind of feels like the advertising model is a lazy man's business as well, because it doesn't incentivize you to make a better product. It incentivizes a monopoly. Right. And how did I arrive to this idea? My stick for the last, you know, two decades at least, and especially with regards to AI and digital technologies, is these technologies are extremely malleable. We can develop them in different ways. We can have higher quality technologies that increase worker productivity, or we can have

rot automation, lazy automation. Right. And have addictive social media that makes you go into your cocoon and you become uninterested in forming bridges and engaging in democratic citizenry, or we can have platforms that actually encourage different types of communications and the active citizenry that democracy requires. Which ones of those will be? And I think since we have gone more and more in the automation way and in the sort of toxic environment of social media, a change requires new products, new technologies. And that means a more open system. And so the way that I sort of started sort of coming towards this idea was, well, what's

a barrier to this? Well, the fact that there are a few big tech companies that can acquire competitors is a barrier. But so is the fact that even if they don't acquire you, they, pigeonhole you into the same ecosystem in which they exist. And I think that's a big problem. How do you mean they pigeonhole you, even if they haven't acquired you as a user? Because to compete against them, you need to also offer your products for free, which means the only thing you can do is for digital advertising. If you need high quality data, you can't

afford it. You're not going to have an incentive to get it. If you need high quality niche products, you know, nobody's going to buy them because everybody is used to this free freebies and it's everything. Right. So it creates a kind of race to the bottom. Yeah, a race to the bottom, but also just there's no reason they would have to compete. You couldn't compete as we haven't really seen any new

social networks in years other than Blue Sky and Threads and Threads is a part of a part of the Facebook machine. And we have seen TikTok, but TikTok is just a amplification of the same business model, same monetization system, same sort of

weaknesses being exploited as Instagram, Facebook, and so. And they burned, and they burned billions and billions of dollars to get there. It wasn't like the people try and, I don't know why people would possibly think this, but they frame bite dance of some plucky upstart versus just a massively funded Chinese juggernaut. Again, this is why I actually use the word ecosystem, because this model itself is highly synergistic with companies growing very fast.

and why do they grow very fast? Because they want market share. They want to dominate the market, but they also want data. And how is that possible? How can you grow so fast? Well, you get venture capital or Microsoft to bankroll you, as in the case of OpenAI. So you burn through a lot of cash early on in order to get data dominance and market dominance. And again, it's not a pro-competitive picture that's emerging here.

I feel like generative AI is something separate because with that they, well, they don't have a business model yet. They do not have a business model. But you know what that does? It makes it even more likely that we're going to just repeat the same sins of earlier social media. Look at what is Open AI doing. It's burning through a lot of cash in order to acquire market share and data. It's not monetizing through anything. And I think the most likely cash cow ideas that are coming up,

up is we're going to use generative AI for internet search and we're going to take over the digital ad revenues. Well, that's more of the same. And I don't, different conversation. I don't think that'll work. But it's nevertheless, I can see the idea. It's funny, these incentives really have, I've never really thought about it before this conversation, but it feels like digital advertising really did harm the tech industry in that they found something very profitable that got more profitable without making the user's life better at all. Well, Larry Page and Sergey Brin, when they first formed their company, said, we don't want ads. That's not like a good model.

Yeah. It's antithetical to a good search product. The moment somebody came and gave them venture capital money and said, but we do it so that you can actually start monetizing it by digital ads, yes. What if you were super rich? But it doesn't sound like this would kill the digital ads industry. Because if you could make— I don't think we should kill it either. I mean, I think, again, if we created a monolith,

a monoculture, that wouldn't be good. If everything was online, everything was based on subscription, that wouldn't be a good model either. So you want a variety. But so, well, here's a more operational level. I'm guessing that this would also have to have some way of cutting through things like if people set up subsidiaries to try and pass off the tax as well. You would have to make sure that there was a way of rounding that out. That's why this is not a graduated tax that is easier to gain. But if 500 million, it's like a very small amount of money, so you just set a minimum like that, perhaps a little bit more,

so that the really small companies are not burdened by it. We know one problem, for example, with the European GDPR, is that once you put a regulation like that, the burden is heavier on smaller companies. And so it actually creates a competitive advantage for the large platforms. And you don't want to do that. But I think 500 million would actually, that would make a very healthy market for smaller companies.

Which is great. We want more smaller companies as well. I think that this would help with the problem a great deal. But don't we also need something to do with the algorithms themselves? Because I feel you could do this and it would solve some problems. It would begin incentivizing them in the right direction theoretically. But you still have this problem of they wouldn't stop algorithm. In fact, this might encourage them.

to be more algorithmically abusive. Absolutely. And that's why I don't think this is a silver bullet. You know, you need a range of policies. But the hope is that at least such a policy would create some push towards some platforms and products to have better quality algorithms that don't trap you like that. But for example, if we're talking about social media, we should also be talking about repeal or relaxation of section 230 of the digital act so that companies that algorithmically boost content cannot then say, well, you know, this is not our speech, this is somebody else's

thing, we have nothing to do with it. So there are some details there that we have to think about and I think Section 230, which was written in a different age in the 1990s, is definitely not up for dealing with issues of algorithmic boosting. And debating Section 230 aside, because that is also a separate conversation, it does feel like we have just kind of not given tech companies much responsibility for what they're doing. No, exactly. There's just none. That's the main reason why I want to have a conversation about Section 230, because it can't

be optimal that corporations that are arguably the largest and the most powerful humanity has ever seen can then wash off their hands and say, we're not responsible for anything that happens on our platforms. Yeah, it feels with 230, and I am not as well read as I should be about it, but it feels as if that responsibility side is the real niggling issue, but also the most thorny, because on some level it makes sense with social media platforms that they should be able to say, we're not responsible for all the posts. And if they had to be, they would be. Oh, yeah, absolutely. And look, I think free speech is a major issue. I am worried about erosion of free speech,

but, you know, I'm also not like a 100% free speech absolutist. I think we have to balance it. And the way that I would suggest is, again, so now we're changing topic a little bit. That's fine. ...230 is, you know, subject to whatever legal requirements there are on, you know, abusive content, et cetera. If you post something on Instagram or Facebook,

and the company doesn't algorithmically promote it, then it's completely... Right. It's there. It's my speech. If my friends find out about it, they can go and look at it. If somebody stumbles on it, that's fine.

But algorithmic boosting is like New York Times putting you on their front page. We can't say New York Times is putting you on your front page and you can say all sorts of lies and crazy things. And that's just freedom of speech. Yeah, okay. Yeah, yeah. I know what you mean, though.

If you have a more preferred newspaper, I'll use that example. No, no, no, but I know what you mean. It almost, and it seems like the problem is that you're saying is it isn't 230 itself. It's the fact that the algorithms boost these particular things. That's why I'm saying 230 was fine for the age it was written, where nobody could have understood the onslaught of algorithmic boosting promotion and manipulation that would come. And it feels like it's an incentive problem, that we just, it's almost, that platforms should either move away from the algorithm model.

Because the amendment section 230 that just says it should go away kind of doesn't sit right with me. I don't think you should. It would make platforms like WordPress impossible to use or like blogging platforms. But the idea of what they promote being more intentional, that I actually really like. This rule that I suggested completely protects WordPress. WordPress doesn't promote. Right. So this sort of reformed 230 is completely fine.

in that respect. So as far as this 50% tax, do we have any kind of historical precedence for something like this being done? We do not. We do not. And that's why, you know, am I sure 50% is the right level? Absolutely not. Perhaps 40%, perhaps 30%. But I think 50's great. Thank you. Well, because the thing is, the way I look at it is these companies are so adept at avoiding responsibility. And they're so unwilling to change their ways. And, so unwilling to be responsible with what they're doing, that it needs to be like this. And I'm sure that if this actually got anywhere near a government, they would have the world's biggest tantrum. But I feel like we need stuff like this. It needs to be a shock to the system. Absolutely.

And I think that, well, actually, maybe that's the question. How practical would this be to actually implement? Well, it depends on what you mean by that. Well, I mean, how hard would it be to be to get this actually into existence with the government able to levy that tax? Well, it would be extremely hard because of the lobbying, as you pointed out, but if there was agreement, if the Chinese government wanted to do it, they could do it overnight. It's all out there. The judicial ad revenue is there. It's measured.

You know, and the flat tax is very easy to implement. You could do it at source when, you know, advertising. companies pay for advertising. You could do it in many different ways. So it's very easy. And it's a version of a variety of VAT like at VOLORM taxes. We have them under much more complicated situations when there is much lower quality data about what's going on.

You know, many middle-income countries have a very complex sales tax or a VAT tax. Yeah. And it almost feels that you could have a little fun with it as well. Maybe you could do this 50% tax and feed it directly into some sort of national venture fund that would end up funding the few. It feels as if the, as go, like on a larger scale, it feels like governments are just 20 years behind technology, not even putting aside even Section 230, it feels like we should have an EPA or an FDA for data.

It feels like we should have ways of actually, we don't know how these algorithms work. And it just feels a little crazy to me. Yeah, absolutely. But the way I would say it is, I'm not sure. that I would say they are 20 years behind in terms of knowledge. I actually... Oh, not knowledge, just legislation. Legislation, yeah.

So, like, a completely different but related topic is we actually need an infrastructure for data markets. Right. So, you know, I think everybody says data is going to be one of the most important factors of production for the future. Right. more important than land. Imagine that I told you that today, land, that is still pretty relevant for many businesses,

it's up for grabs. You can just go and get whatever piece of land you want and you don't have to pay for it. You know, that tragedy of the Commons is well understood from history. It would be disastrous. Yeah, it's just the Wild West. Yeah, it's Wild West. Nobody produces high-quality data. Nobody gets compensated for the data that they have.

And it encourages, you know, the monetization that model that we talked about where you actually sweep people's data without their permission or without their understanding and you try to monetize it via digital ads. Another podcast from some SNL late night comedy guide, not quite. Unhumor me with Robert Smygel and friends. Me and hilarious guests from Jim Gaffigan to Bob Odenkirk to David Letterman, help make you funnier. This week, my guest, SNL's Mikey Day and head writer Streeter Seidel, help an acapella band with their between. songs banter. There's the worst singer in the group. The worst?

Yeah. Me. Is there anything to the idea that because you're from Harvard, you only got in because your parents made a huge donation. The group. The yard birds, right? That's the name. The Harvard yard, but they're open.

Do you have a name suggestion? We're open. Since you guys are middle aged. One erection. Listen to humor me with Robert Smigel and Friends. on the IHeart radio app, Apple Podcasts, or wherever you get your podcast. Humor me. I need some jokes to make me seem funny.

Run a business and not thinking about podcasting, think again. More Americans listen to podcasts than ads supported streaming music from Spotify and Pandora. And as the number one podcaster, IHearts twice as large as the next two combined. So whatever your customers listen to, they'll hear your message. Plus, only IHeart can extend your message to audiences across broadcast rates. Radio. Think podcasting can help your business. Think IHeart. Streaming, radio, and podcasting. Let us show you at iHeartadvertising.com. That's iHeartadvertising.com. Jacob Kingston grew up in an isolated polygamous sect. We were God's chosen kingdom on

earth. He felt destined for greatness. So when a swaggering Armenian businessman catapults Jacob into an extraordinary world, he doesn't look back. Ferraris and Lamborghinis, private jets, meeting the president of Turkey. I'm Michelle McPhee, and this is one of the most shocking criminal conspiracies I've ever come across. When Jacob met Levin this went to a billion dollar fraud. But with two kings from entirely different worlds, just how long can their empire survive? The largest tax investigation in American history. You need to tell me what you know. Is somebody coming after me?

Jacob told Levan, you're ruining my life. Listen to Kingdom of Fraud on the IHeart Radio app, Apple Podcasts, or wherever you get your podcast. Life throws hurdles big and small. The question is, how do you conquer them? On hurdle with Emily Abadi, we sit down with the most inspiring women in sports and wellness, professional athletes, coaches, and Olympic champions to talk about the challenges that shaped them and the mindset that keeps them going. From the WMBA standout, Kate Martin, and rising hockey star Layla Edwards.

A boy can do it. I don't see why a girl can't. Like, I've never understood that. Like, it didn't make sense in my brain. It's hard to be in spaces that no one looks like you, but don't ever feel like you don't feel on. Don't let that be the reason you don't do it. An Olympic champs Gabby Thomas and Katie Ledecky. The ability to show a gold medal to someone

and have their face light up and smile, that means the world to me. And that's what motivates me to win more gold medals. At our level, at this scale, like being able to fail in front of the entire world, like, I can do anything. I can do anything. Because resilience isn't just about winning. It's about showing up, even when it's hard.

Listen to Hurtle with Emily Abadi on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. Presented by Capital One, founding partner of IHart Women's Sports. The story I've told myself about love or relationships can then shape my behavior, and that can lead me to sabotage the possibility of connection. This Mental Health Awareness Month, tune into the podcast deeply well with Debbie Brown and explore the journey of healing, self-discovery, and returning to yourself. We explore higher consciousness, emotional well-being, and the practices that help you find clarity, peace, and self-mastery in a world that can feel overwhelming.

The world is becoming lonelier. We're not becoming more social and connected. We're becoming more individualized, but we actually meet people in. connection. If you've been searching for a soft place to land while doing the work to become whole, this podcast is for you to hear more. Listen to deeply well with Debbie Brown from the Black Effect Podcast Network on the Iheart Radio app, Apple Podcasts, or wherever you get your podcast. So a complementary thing is we think about how is it that we can have a system where data producers are encouraged to produce higher quality data so that perhaps you

you know, next version of a large language model learns not from Reddit, but learns from high-quality domain-relevant expertise. I think in that case, I think in that case, I'm not sure I agree just because large-language models getting higher-quality data is a pro, like how you build them, like just higher-quality data would just be, they still need more. But I get what you mean that if these companies were incentivized to actually have good data and provide good services with the data, that would be better, because that's the thing. I'm not, I don't love digital targeting.

I don't love any of it, but man, if they have all this data, why are all their services so impersonal? They don't feel like they're for us. And why does Microsoft Word always crash? Yes, I know. But that one, that ones, it doesn't matter. They have the dot doc and dot, doc, X model. They have a tiny little kind of monopoly now, though they were various antitrust actions have to change. Let me actually talk, push back a little bit on genera.

A.I. Because I think your statement makes sense if you buy in that generative AI is most productively developed in the form of general purpose human-like chatbots. They will need like huge amount of data because next word prediction is very, very inefficient and you need to imitate humans in a variety of circumstances. But imagine that we use generative AI in a very domain-specific way. I want to know what drug creates what side effects in conjunction with other drugs. For that, I don't need my generative AI tool to communicate with me in human-like fashion or write Shakespearean sonnets. I just need some very specific domain expertise, but that high-quality data is actually not out there. And I fully agree with that. And

smaller language models, focused language models, those make sense. But I think we are actually agreeing because this is an incentive problem. The reason Open AI isn't really focused on that is because it doesn't make that much money. Well, Open AI itself is not making a lot of money. They're not making...

No, I think they are not focused on that because, A, if you want to get big, very, very fast and collect a lot of data, domain-specific models are not going to work. So creating hype around something that sounds very intelligent is a much better tool for doing that. And second, I think in the industry is still in an unhealthy way, in my opinion, preoccupied with artificial general intelligence. Right. Human-like intelligent, even if that's not what we need, even if that's not what's feasible, even if that's got a lot of downsides.

So that's why they don't, in my opinion, pay sufficient attention to these domains. specific expertise models. So for you, I actually agree, but also, then that is an economics problem. That is a, these companies are incentivized to grow at all cost to get as big as possible. Is what you're suggesting that they shouldn't? It is, it is not just an economics problem, but it has an important economic leg. If we did not have venture capital be so important, this model would not have gotten off the ground. So how do we push back on the VC model? How do, How do we actually make technology work without that model? Because I agree, it's the growth at all costs, build as big as possible, then IPO,

and everyone gets rich other than the user. Well, what are the alternatives? I don't know. I mean, I am not so much of an interventionist that I'm going to say, you know, you should tax VC as well. But I think one thing that encourages the VC grow at all cost model is that we don't have any antitrust. If there was very strong antitrust legislation and implementation, then becoming so big wouldn't be so attractive and you wouldn't be able to acquire all your competitors in the process as well, which is a very important part of this, get very big, very quick. So I think our big

failure of upholding existing antitrust laws and introducing new antitrust laws appropriate for the digital age, I think has contributed to this problem. Is there a way of incentivizing VCs? So actually, this is the final question,

because you might actually have an answer here. How do we incentivize venture capital and the startup industry to start investing at the earlier stage? Because a big fund just gave back a chunk of their fund because they were not finding as many opportunities in the late stage. And most of the money goes into that late stage. How do we incentivize that?

That's a much harder problem because even well-qualified VCs are not going to have an easy time recognizing a very promising product when it's in the garage stage. Right. But, and this brings another set of, you know, set of, of issues. The fact that we tax capital so lightly contributes to this. Again, we're subsidizing VCs because if you make your money via VCs as sort of investment on your capital, you pay very little tax. You know, if you are, you know, a tech billionaire, I won't name names, you don't even pay yourself a salary.

You keep on borrowing money from venture capitals or other specialized financial vehicles, and you pay yourself out of that. Everything is capital income. You pay minimal taxes. So our tax system already, a big contributor to inequality, actually also distorts the digital landscape.

So one simple thing again, which is probably even less likely to be implemented in our current polarized environment, environment is let's tax capital and labor at a flat rate the same, or you know, you can act whatever progress you want, but you don't distinguish capital and labor income. If you're going to tax labor income at 30%, tax capital at 30%. I agree on that one. It just feels like it would be great if there was a way of just almost, because you're talking

a lot about taxation and such, and I agree that we need those controls, but is there a way to incentivize them to put more money earlier, make it? more risky bets. I'm not saying a deduction because that would be crazy, but it feels like that would also solve in part, in concert with these taxes, a way of getting that money into the early ecosystem. There may be, but I don't know exactly. We should think more about it, but there is an alternative solution. Yet another policy proposal is we fund a federal agency on AI, which is tasked both by communicating and developing best standards on things like privacy data, you know, AI standards, security, safety, but also has deep enough pockets that

it can play that incubator role for especially for technologies that are deemed to be socially beneficial. So if we have technologies that actually protect users' privacy and enable users to make better decisions, that's the kind of thing that the government should put money in early on. Some of it will go to waste. Some of it will go bankrupt. But if a few of them are successful, that's great. And if the alternative is that the VCs are going to develop the technologies that are most manipulative, there is even more reason for putting this money. Theron, thank you so much for joining me again. It's been such a pleasure. Of course, this was my pleasure. Thank you for being interested in these issues and such, for having such a

great conversation. Thanks so much. Thank you for listening to Better Offline. The editor and composer of the Better Offline theme song is Matt Rosowski. You can check out more of his music and audio projects at Matersowski.com, M-A-T-T-O-S-O-S-K-I.com. You can email me at E-Z at Better Offline.com or visit Better Offline.com to find more podcast links and, of course, my newsletter. I also really recommend you go to chat. Where's Your Ed? Dot to visit the Discord and go to R-S-Better-O-L-Line to check out our Reddit. Thank you so much for listening. Better Offline is a production of CoolZone Media.

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