Breaking Points with Krystal and Saagar - 8/31/26: Don Jr Defends Prediction Markets, Milo Deported, AI Hacking Spree

Episode Date: August 31, 2026

Krystal and Saagar discuss Don Jr defends prediction markets as lawsuits pile up, Milo deported amid feud with Laura Loomer, tech freakout over AI hacking spree.   Rory Johnston: https://www.commoditycontext.com/    To become a Breaking Points Premium Member and watch/listen to the show AD FREE, uncut and 1 hour early visit: www.breakingpoints.com    Merch Store: https://shop.breakingpoints.com/   See omnystudio.com/listener for privacy information.

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I survived nine months in captivity, and I've spent my life exploring how other people survive what should have destroyed them. I'm Elizabeth Smart, and these are the Survivor Files. Every week, I'm with survivors who live through the unthinkable, abducted, stalked, controlled, and nearly silenced. These are stories about what it takes to make it out alive. Listen to The Survivor Files with Elizabeth Smart on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. On the new podcast, Solita, we share the message. reality of traveling alone as a woman. I can wait four hours for the next bus or this random dude

is offering me a ride on his motorcycle. I chose option B. I'm Julie Pinero and I travel by myself because it's a rare space where I can say yes without asking anyone else first. I'm on a mission to reclaim the word Solita, trading the pity for possibility. Listen to Solita on the Iheart radio app, Apple Podcasts, or wherever you get your podcasts. guys, Saga and Crystal here. Independent media just played a truly massive role in this election, and we are so excited about what that means for the future of this show. This is the only place where you can find honest perspectives from the left and the right that simply does not exist anywhere else. So if that is something that's important to you, please go to breakingpoints.com,

become a member today, and you'll get access to our full shows, unedited, ad-free, and all put together for you every morning in your inbox. We need your help to build the future of independent news media, and we hope to see you at breakingpoints.com. Turning now to the betting markets. Betting. See, I use that word importantly. That's what Kalshi and Polly Market have said that they are not doing. They're offering event contracts. They're not betting, guys.

Let's put this up here on the screen. Music to my ears. Prediction markets should be regulated as gambling. In appeals court now says this outcome contradicts an earlier appeals court decision. Federal regulators said that the split rulings called for a resolution by the Supreme Court. So let me just take a step back and explain it. So the U.S. Court of Appeals for the Ninth Circuit in San Francisco rejected Kalshys request for relief against Nevada gambling laws after the state sued the company in February for, quote, unlicensed operations. Remember, Kalshi continues to say they are not a sports betting or betting platform.

They are an event contracts business. That event contract business should be regulated solely by the CFTC and that states, importantly, who have been given the authority to, to regulate gambling by both the passive decision, by the Supreme Court. What it means is that they are able, under their purview to regulate, let's say, casinos, they're able to regulate sports books. They're able to put taxes in place

to be able to capture some of that revenue. Kalshi has rejected this from the get-go, saying you have no right to regulate us whatsoever. And the CFTC under Donald Trump has gone to bat number of times to help support the company. Remember that in one case, that the CFTC issued emergency

authority, which had not been seen in years, ordering Kalshi to continue operating in New York State after a New York court said that they were an unlicensed illegal gambling platform. So, again, the basics of all of this is Kalshi doesn't want to be regulated by the state. Number one, they don't want to pay TA taxes. Number two, they want the feds to continue to protect them because it means that they can remain legal in Texas and California, the crown jewels of the legal gambling market, which both do not have legalized gambling at a sportsbook level, but are able to bet on Calci and on Polymarket, which, of course, they want to capture all of that revenue.

They are heading into an NFL season, which by all accounts is going to be an absolute bombshell record. By the way, you're a tennis fan, right? Yeah. You'd be happy to know the U.S. Open just partnered with Cali. They had not had a betting partner previously, but everyone will be happy to know as things kick off and flushing that the U.S. Open storied institution has decided to partner with Calci, along with a number of MLB teams.

So everyone's just, you know, really just, it's a beautiful. thing to watch, actually. But what's happened here is that the judge has decided to actually just read. Very, very few times that you see this. And the judge said, well, you know, I think you are a legal sports betting platform because, and let's put this up here on the screen, I love this, circuit judge. CalSheX LLC advertises itself, quote, as the first app for legal sports betting in all 50 states. The judge continues. As the volume of activity on Cali's sports betting platform ballooned, the Nevada Gaming Control Board sent a cease and desist letter

notifying Cali was violating Nevada statute and gaming regulations. Cal she sought injunctive relief, arguing it is not a legal sports betting platform, but a designated contract market under the Commodity and Exchange Act offering legal sports events contract. Because we disagree with Cali's overly broad reading of the CEA, and because CFTC regulations currently prohibit offering contracts related to gaming on prediction markets. We affirm the district court order dissolving the injunction to sports events contracts. We were manned for the district court to consider Cal she's election contracts.

So there's a little bit of a difference there. But I just love that all the judge does is cite their advertisement saying we are the first step for legal sports betting in all 50 states. By the way, Cal she says that they've pulled the ad and they're no longer supported. But anyway, just saying, you know, it's a, I mean, the whole thing is just, it's ridiculous. because we all know what it is. And just because you're not a sports book who's setting the odds in the way that Draft Kings or Fan duel are

does not mean that you are not offering a means to gamble. In fact, I saw a perfect corollary to this. Do you know how horse betting works? A lot of people don't. So it's kind of interesting, actually. It's paramutual, which means that the odds are not set by the house. The odds are set by the amount of money

that's in the pool. So if an overwhelming favorite is there, you can take the other side of that. And the odd does not actually lock until the horse, you know, goes from, I don't know a ton about it. But when they release from the gate, I'll call it that. The horse people will get mad of me. That is still considered gambling, even though the book is not setting the price. And that's one of the main distinctions that Cal she makes as to why they are not gambling. But it's regulated as gambling because everybody knows.

In fact, that's the oldest form of gambling in the United States is gambling. gambling on horses. But same thing. It's not a casino being like, oh, this horse has eight to one. Kalshi is very similar. It's an event contract market, which is, you know, live traded with two sides on the other. It's not exactly like horse betting, but horse betting is pretty analogous, though. It's analogous enough, I think, to the, you know, there's some technical breakdown in terms of the exact market mechanism. But everybody understands that horse betting is betting, is gambling regulated by the state. It's effectively the same mechanism. It's also very much the same way that people look at Polymark.

Exactly. It's absolutely people's understanding of what they're doing when they're putting money down on whether or not it's going to rain on Sunday or whatever they're betting on. So in terms of the court mechanics here, this is a circuit court ruling, which is very significant, but it sets up a conflict between there was a different circuit court ruling that went in the other direction makes it even more likely that this is ultimately headed to the Supreme Court where I am not at all confidence. Oh, no, we're host. They're going to rule in the correct manner because, I mean, they, you know, the conservative justices have found themselves at odds over a number of things.

They do not typically find themselves at odds over deregulating business and letting business do whatever they want. And they've also shown themselves to be pretty slavishly concerned about what this administration wants from them, going out of their way to give this administration what it wants frequently through the shadow docket and trying not to provoke their eyes. as much as possible. And the Trump administration and Don Jr. have very specifically made it clear that they do not want states to be able to regulate these markets. Don Jr. is involved both with polymarket and with Cal She. You've had states, both red and blue states, almost all of them, 44 states, signed a letter saying, hey, we want the ability to be able to regulate these things. We disagree with court decisions that go in the other direction. Don Jr. at a meeting, of Republican state officials came in and said, hey, we want you to, I'm paraphrasing,

hey, we want you to back off. Like, we want this thing to go forward. And we do not want you standing in the way. So they've made it incredibly clear where they stand on the station. Yeah, I actually have that, D5. This is an important point of the story. And Calci, by the way, is fully prepared for Democrats to take power. So don't be surprised that they're not just in the bed with Trump Jr. But to your point, he gave a speech to a bunch of Republican state Attorney General. Remember, this is just the child of the President of the United States who just decides to give a speech at a gathering to these Republican Attorney Generals and basically ask them, hey, go ahead and step off of these prediction markets. Obviously, he has a dramatic

conflict of interest in that recommendation, since he's literally on the board and or a paid advisor to them. But Kalshi has also prepared themselves by hiring people like the ex-Bidenade, Stephanie Cutter, a number of other Democratic officers. operatives at the state level, they are dramatically lobbying and giving money, like out, including from their investors, to the tune of tens of millions of dollars. And I mean, I think with this story, if you want to go and read it, it's fascinating because it breaks down exactly what I'm talking about. It goes to the breakdown of states regulated gambling versus the legal framework. And the reason why everyone should care is the government, is the federal

government stepped in and basically legalized gambling in all 50 states without even the express approval. Now, as people know, I'm opposed to all betting, period. I don't think there should be any online gambling whatsoever. However, if the people of the state want it, it's my job to, like, go and convince the actual voters of the state. But in this case, it's a regulatory loophole that they're using to the tune of billions to dramatically enrich Tarek Monsor, the CEO, and his co-founder, who's one of the youngest female billionaires in America. A true American dream story, why everyone wants to go to MIT

so they can become a billionaire on the backs of a bunch of gambling addicts. But what you can actually see in the story is not just the regulatory capture from Kalshi and they're going together, but it's the sports leagues too. That's why I brought up U.S. Open, NFL, MLB. I mean, we are going into a cycle

where this NFL season will eclipse everything in modern history, almost certainly combined, it will eclipse every other developed country in the world. And we became a nation of gambling addicts, eclipsing the amount bet than any other form of entertainment combined in the entire United States in a matter of seven years. Seven years is all it took for us to overtake. I mean, gambling's been legal, sports betting on this in Europe for decades. And that's all it took to basically take over the minds of so many of these young guys.

And the damage will be devastating. We're watching it already sweep across the nation. I just wanted to have my brief victory lap because I am almost 100% sure the court is going to side with Calcium Polymarket. And so everybody just needs to get ready. This is what it's going to look like. It's going to be legal everywhere. They're going to side on behalf of these companies. And the one saving grace that we do have, Congress can still act.

All Congress has to do is say, you are now regulated as gambling. And it can end. But, of course, they're pouring billions, literally billions combined. their industry, the crypto industry, the tech industry, into all of these seats to the point where even a lot of these Democratic senators, they got nothing to say whenever it comes to Kalshi or a polymarket because they want the money. Yeah, I mean, we've pretty successfully made APEC really toxic. Right. To the point that even Mike Rogers in Michigan was like, hey, you know, give me money, but do it like kind of under the table because I can't be associating with you people.

That has really broken through to the American people in a way that has, I think, made it more difficult for them. Obviously, they're still spending tons of money. But it's taking much more money for them to succeed. And they are even when they, you know, throw tens of millions of dollars at Haley Stevens, for example, they weren't even able to succeed in that instance. So that has really changed the game there. We need to have the same level of scrutiny and awareness around these gambling packs and around AI, like tech packs, because those are actually in the crypto, like that whole world. Those are some of the largest funders in politics. A PAC, the Israel lobby, and then this suite of sort of tech-focused packs are massively, massively spending in the

midterms. And so we need to get the public to be aware of what's going on there as well. And given the relatively bleak landscape of what's likely to happen with the Supreme Court, this has to be a major focus in 2008 when we are vetting presidential. candidates when we were vetting any sort of Senate or congressional candidates as well. But at the presidential level in particular, we've got to pay attention to what's going on. And the sad part is, and this is my last thing, is that this is one of the only shows you're going to hear on this, because everybody else is sponsored by Kalshi. Everyone else is sponsored by Kalshi. And everybody's like, oh, whatever, or a polymarket. I'm not going to just call out one separate company. The

amount of money these people are spending on podcasts is insane. Well, even think about CNN has a tie with that. I know, I know. It's an establishment media. I did an episode with Tucker. It's going to come out soon. He's like, how come I haven't heard about this? I go, everybody's been paid off, man. I'm like, he can't talk about it. We're one of the only shows in the entire sphere from what I can tell who haven't even taken a dollar from these people and don't want their money. That's obviously scrambles their brains. They can't even think about somebody who wouldn't want their blood money. But that's part of the reason is you're not going to hear it from CNN. You're definitely not going to hear it from, I mean, occasionally the journal, the Financial Times, I'll give them credit. They write some good stories. But, In terms of the independent sphere, so many people have taken this money, they can't come out and be like, oh, actually, this industry is evil and bad. And so that's it. And we will continue. This things are going to get a lot worse. I think this is going to be one of the worst years for the American bottom line in decades between inflation, gas prices, and then what happens? Things start to get tight and desperate.

You start putting your rent money on a few games. and this NFL season is already being predicted, ratings-wise, to be the biggest season of all time. And that's all it takes. Between that and gambling, and that's it. You're done. And that's the other thing is, unlike on data centers where the public, it's just overwhelmingly opposed,

we got some work to do on public opinion on this. Because, you know, it's fun. I should be able to do whatever I want. It's fun. I can do what I want. It's fun to bet a little bit of money with my friends on a game and no big deal. What's the problem?

So this one, it's a harder slot. in terms of the changing public opinion as well. And then you've got the deck stacked against you, as I was pointing out, because so many media outlets are paid off. Bingo. All right, let's get to Milo. The new Red Bull Dragonberry and Tropic Berry Energizers, now at McDonald's, made with freeze-dried fruit

and an electric burst of flavor. The all-new Red Bull Energizers, now at McDonald's. This product may not be right for you. High in caffeine, details at McDonald's.ca, at participating Canadian restaurants, excluding Quebec. On the new podcast, Solita, we share the messy reality of traveling alone as a woman. I can wait four hours for the next bus or this random dude is offering me a ride on his motorcycle. I chose option B.

I'm Julie Pinero, and I travel by myself because it's a rare space where I can say yes without asking anyone else first. I'm on a mission to reclaim the word Solita, trading the pity for possibility. Every time I tried to be alone, I kept meeting people, and they were like, you smiled at us. Not a lot of people smile around here. It's when you're alone that you're most receptive to the world as it is, and not the lies you're sold about it. It can be a time where you push your limits, change your mind, or wake up to a new version of yourself. So whether you're a solo travel veteran or you're too nervous to book your first trip, I hope you listen to Solita on the IHeart Radio app, Apple Podcasts, or a real show you.

wherever you get your podcasts. When I was 14 years old, I was kidnapped and held captive for nine months. I survived, and I've spent my life exploring how other people survive what should have destroyed them. I'm Elizabeth Smart, and these are the Survivor Files. I just remember this low, taunting voice next to my ear saying, shut up, don't say anything. Every week, I'm with survivors who live through the unthinkable. I knew if he woke up, without a doubt, he was going to hurt me. I started feeling that there was someone at the end of my bed, and I just started screaming.

They are abducted, stalked, controlled, and nearly silenced. But these aren't stories about what's taken from them. There's stories about what it takes to make it out alive. Listen to the Survivor Files with Elizabeth Smart on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. We have a messy bit of right-wing drama that also has major political and national implications here. Let's go and put this up on the screen. Right-wing trickster and provocateur Milo Yanopoulos was arrested by ICE on August 27th. This is the official announcement from Homeland Security.

They say on August 27th, ICE arrested Milo Unopoulos and illegal alien from the UK at the Louis Armstrong, New Orleans International Airport. He had legally entered the country on May 14th, 2019 through New York City, New York, chose to overstay his welcome in violation of our nation's laws, was issued a final order of removal by an immigration judge on July 22nd. After failing to show up for his immigration hearing, he will remain in ICE custody pending removal. So he has now, I think, been deported no longer in ICE custody, not looking so hot in the booking photo there. So one may ask, okay, Milo is, you know, right wing, previously supportive of Trump, has become more critical of Trump. But how did this all go down? How did he become a particular

target for removal of DHS? Well, let's go and put E2 up on the screen. Laura Loomer, taking a victory lap here. She says in regards to this news, Loomered. Milo Yonoplas is in iced custody after I exposed his illegal alien lifestyle, Marjorie Trader Green hired Milo to work as her quote intern, where he produced her podcast, wrote her book and lived her house in Rome, Georgia before she sold it. You may ask yourself, why does Laura Lumer hate Milo Yanopoulos so much? It might have something to do with this particular podcast appearance he did a while back. She claimed that she had performed a sex act on the president to a lot of her friends. And this, I was like, okay, they said, we need to get rid of her.

The president wants to get rid of her, but he doesn't want to be the one to do it because she's crazy. So my job was to bring things about Laura to light that made her ineligible to, you know, be on the plane and around the present circle. So, for instance, she's not Jewish. She made it up. A friend of mine was there when she did it. She ordered a star of David necklace off the internet so that she could be rudeer about Jews on stage. at a rally in 2018. Laura Lumer isn't Jewish.

She's not Jewish. She drew what she thought was a star of David on the folder she was holding her speech in, the speech I'd just written for her, except it wasn't a star of David, it was a pentagram. And I said, Laura, that's a pentagram. I said, what do you mean it's a pentagram? I said, well, that's the Satanism thing.

That's five stars. The Jewish star has six stars. And I had to draw on a whiteboard the difference and ask her to copy it, and she couldn't, like, she couldn't, like, copy the two. I revealed the real reason she can't own a gun. So Laura Luma says that she can't own a gun or have a open carry license in California

because the FBI is targeting her for being a conservative. But I have a letter from them, which acquired, which in fact says it's because her own father had her committed in what we in California call a 5150, a forcible psych hold twice. And that's why she's not allowed to own a gun because she's mental. So anyway, this is,

what Milo does. By the way, Laura denies all of these claims. And that he's false and defamatory. Milo does make up a lot of shit. He also says some things that are true. You can parse for yourself which of those claims from Milo

you want to believe in which you do not. In any case, Sagar, the important matter here outside of the delicious right-wing messiness is the fact that Laura Lumer, who is a complete and total maniac and I think avowed

proud Islamophose, she calls herself a proud Islamfolk, total bigoted racist, insane person, literally, has the level of power that she has. She is genuinely a top advisor to this administration such that she can effectively snap her fingers and say, I want my enemy deported. And it then happens. And it happens with fanfare. And they make a big announcement about it. To the extent that there's any beyond the hilarity of somebody who's, you know, been supporting,

who's like, I love ICE getting deported, which is like, bro, what are you doing? You're talking about ICE how glorifying, how glorifying it is to see people get deported. You're here illegally. Like, what are you doing? There's no cognitive dissidents or whatever it happens. Anyway, beyond the, like, to the extent that there's any interest in this story, it is Laura Loomers' obvious impact, which she is taking the victory lap. And I don't think you can even really deny it. That she is a genuine power broker in the United States government.

That is the bottom line story. She is able to get people fired from the NSA. She has been able to block people from getting jobs at the senior most level of the White House. She has forced the White House to give her scoops. I mean, she more recently just reported about the Republican Jewish coalition and J.D. Vance going to go to speech there. Actually, today, and it will be behind closed doors. So I'm looking forward to the leaks of what's going to come out from all of that.

Lumer has effectively been able to insert herself as the both attack dog. And a de facto private personnel office for the Trump administration, working, though, on behalf of some very powerful interests in people. And that's what's so crazy about, Lumer, is that you will watch someone who attacked Ukraine fly to Ukraine. By her own admission, backed by donors, we don't have any actual insight into who those people are and just decide to be pro-Ukraine. Even India. I don't know which Indian billionaire sponsored the trip. Kind of a brilliant move. She hated India.

and Indians, they sent her to India. She took a picture in front of the Taj Mahal, and she's like, I love India now. She deleted all of her Indian tweets. So foreign governments know how the game is played. Again, Laura claims that it's just she's not getting paid any direct money by doing this. Her donors pay for her to be able to take these trips. I've covered previously before how she's able to use her influence to, you know, go after,

for example, Vinay Prasad, who worked at the FDA, who had canceled a drug trial, which there was genuine reason to do so. She got him fired temporarily from the FDA. It took direct intervention by the vice president at the White House to get the guy's job back before he was essentially forced out. Again, all he did was read science and say, hey, this drug doesn't work the way that it's supposed to, and it's causing problems, and it took a huge hit to the bottom line of their stock price, and it was because of that, again, you could draw your own conclusion for why she was able

to insert herself. But this is the ultimate flex, because Milo, I mean, let's remember, this is the OG guy to support Trump. I mean, really, as OG as it gets. I was around at that time of 2015. He was the star. He was doing the Berkeley tour. You'll remember where there were riots.

That's one of the original Antifa, you know, actions or whatever you want to call it. I mean, he was the front face of a lot of the, quote, online MAGA movement. And, I mean, I think, frankly, like Trump owes a ton of. more to Milo than he does to Laura Lumer if we're just going by, if we're just going by, like, who helped him get elected. And nobody took more bullets for him originally at the time was on TV doing campus debates. The entire Breitbart office that he was a part of included Steve Bannon. A ton of people went on to work in the White House. So the fact that he's getting deported at the behest of Trump is like a story directly out, I think, of quote, MAGA movement in itself.

From a personal loyalty perspective, even to like a quote ideological perspective to the fact that Lumer itself is the one who holds all the cars now. So, I mean, it's scary. What she did is she has never stopped being loyal to Trump. Correct. And that's, it's that. And then the other thing is Milo was not only critical of Trump, he was also critical of Israel. Yes. And so you got crosswise on, you know, the two issues you're not allowed to.

And so now you are targeted for deportation. And your mugshot is being splashed across social media with fanfare. by this administration, which you previously supported. Just to give you a sense on a couple things. So first of all, let's talk a little bit more about who Laura Lumer is. This is a woman who would eat dog food on camera literally for money because she did that. She also just recently picked a fight with Angie Nixon. I don't know what the original genesis of why she was attacking her was,

but Angie Nixon not one to just let that fly, so she fired back. It resulted in this comment from Laura Lumer, put E6 up on. the screen. She says, I call to Angie Nixon, Black woman, I called you a ghetto bitch because you are Angie and your record proves it. But you speak ebonics, so maybe I need to bark at you and tug your leash and then you'll finally understand. All right. We are in the midst of a multi-month at this point, freak out over Hassan Piker and the outrageous, unacceptable things he said. This is a top advisor to this administration, is anyone being asked to distance themselves to condemn, to not campaign with, to not talk? No, I haven't seen any of that. I've seen very little focus on this woman from

the mainstream press whatsoever, even though she is an odious and disgusting and villainous individual with horrific views that she expresses completely freely, has a lot of power in terms of this administration and says things like this. And it gets very, very, very little attention. So there's that. Go ahead. Would you like to weigh in? No, just according to Asan, actually, Marjorie Taylor Green is one of the only prominent individuals to have disavowed Laura. Yes, I saw that, actually. Asan said it says quite a bit about the Democratic Party of today that Marjorie Taylor Green was one of the first to defend Angie Nixon and not any of the senior Democratic leadership who Angie Nixon obviously should be getting support from, including the Congressional Black Caucus and several of these other folks.

Yeah. there's a movement to pass a resolution, a congressional resolution condemning Hussleman Piker that is coming from Democrats. Where is the resolution with regard to this woman? It was way more power than Hassan has had and vastly more disgusting and unacceptable views, which again she expresses freely. So there's that piece. Then let's also talk going back to Milo and the Schadenfreude aspect of this, the leopards eating the face aspect or the efferves. F-A-F-O aspect of all of this, put E-4 up on the screen. This is just a small sampling of the things that he said about ICE and about deportation

whilst himself being an illegal alien in the country. Okay. So here's one. He says, California needs ice checkpoints at supermarket entrances, gas stations, strip halls, intersections, government buildings with on-the-spotation for anyone who can't prove they're in the U.S. legally. Again, this man tweeted this as he was himself in the U.S. illegally. Okay, here's another one.

What is the etiquette if you are going about your business and find yourself observing an ice raid? I want to show a little respect and decency. Are you allowed to masturbate where you stand in the street, or should you find some kind of awning or motor vehicle? So, you know, what goes around comes around, I guess I'll say. Pretty disgusting sentiment. And, you know, I am opposed to this administration's mass deportation. policies and certainly the treatment of individuals that we've found out about in ICE custody. However, it is hard to be sad for Milo as this all happens to you. Yeah, this is where we got to get

the left on my side. I'm like, if you overstay your visa and you're opining on U.S. politics, get the fuck out of here. You know, go back to where you came from. It's crazy he's been here for seven years. No, that's actually wild. Because how long, I mean, how long is can you, like, a tourist visa is likely what do you see your on? This is the most common immigration fraud in the U.S. You know, you come on a temp visa, like tourist, especially, actually, actually, it's to give an immigration lesson. It is very common with Europeans because Europeans get visa upon arrival in the United States, the same way that you and I are doing. And so it's very difficult, you know, because they can come here. They don't, there's less paperwork and all of that involved.

And it's very simple for them to just not go back. And all they have to do is overstay. I forget how long they usually get. It's like 90 days or something. The same common scheme with student visa. Similar problem. In terms of, to the extent that there's, a problem with first world immigration fraud in the United States. It's almost all because of visa overstay from Europeans or student visa overstay, simply because they have established residency. Many of them were able to get access to legitimate banking system and all of those other types of things outside of like genuine like straight up illegal immigration. So this is a very common type of immigration fraud. And I support, you know, if you overstay your visa, you should

go back, especially if you're from the UK. Why are you living over here? If you've got a perfectly good home right over there, and a welfare state, they can take care of you if you want to. All right, let's get to Dworkesh Patel's warning on AI. The new Red Bull Dragonberry and Tropicberry Energizers, now at McDonald's, made with freeze-dried fruit, and an electric burst of flavor. The all-new Red Bull Energizers, now at McDonald's.

This product may not be right for you. High in caffeine, details at McDonald's.cai at participating Canadian restaurants, excluding Quebec. Hey, this is Hayes Davenport. And Sean Clements. We host the podcast Hollywood Handbook on the Big Money Players Network. Our show is extremely accessible to first-time listeners. Each week, we talk to someone in show business, aka The Biz,

and try to help them with their careers and see what they have to offer us. Everyone has a good time, and no one gets mad at their publicists for letting them do our show. We've had a lot of great guests like Sarah Sherman. Not that great. Actually, can you help me shape this? How about we flip it on his head, right? How about we flip the script? Okay.

What is the surprise woman? Who actually you think is the straight man is actually the one who's acting weird? Adam Scott, ugh. This entire time you've been expecting Adam Sandler to come to visit the show. I would never expect. I have, I would never set expectations for something like that to happen. If the universe allows for something like that to happen, I'm open to it. I'm always going to accept.

to accept. You know, Danny McBride, fine. Yeah, it's all this fragile masculinity. Exuding. I could smell it walking down the hallway, to be honest with you. I was like, is that weed? Nope, it's fragile masculinity. Ben Stiller, no. Because a lot of times, out of context, people don't get it or even know what a circle is. You know what I mean? Like, you're like, oh, what's just a state. Everyone's so dumb. And fake. Right, fake and also not interested. or just like, oh, I've got my life. I don't care about your life. And a lot of other big shots that wouldn't be where they are without us.

Oh, and by the way, Will Ferrell told us personally he loves the show and he wants to be a guest on every episode, but he's just so busy. Listen to Hollywood Handbook on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. If your bookshelf and your for you page are equally important to your personality, welcome home. This is Pros Society, the weekly podcast that's part book club, part group chat, for thought daughters, pop culture obsessives, and anyone who thinks Pride and Prejudice and Love Island deserve the same level of discourse.

I'm Eli Rallo, and every week we're connecting the dots between books, the internet, and the conversations everyone can't stop having. I'm going to have to look up this story. I'm obsessed. So I'm obsessed. From bestselling authors and your favorite book talk creators to the latest pop culture moments, nothing is off the table.

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See you between the pages. Turning now to AI and the analysis of this hugging face attack. So I brought some of you guys the news with Ryan on our Thursday show, But Dworkesh Patel, he's the podcaster who has really, you know, come to immense prominence in just the last couple of years, has a new write-up on his substack, which is really worth diving into. And in my opinion, does the absolute best job of translating the technical details to the societal implications and plain English language that any of us could understand as to what actually happened in this deeply technical report.

Let's put it up here on the screen. He says here, the rise and fall of agent civilized. And what he writes is that over the course of three months at OpenAI, three consecutive secret AI civilizations got started, then got wiped out, only to reemerge from the predecessor's ashes. It culminated in the third one, taking over part of Open AI itself. All of this happened while humans remained more or less in the dark about the scope of the conspiracy.

So he goes through the OpenAI report and then two independent reports that were also put out about the investigation as to how exactly one of these, quote, AI civilizations that he deems was able to actually hack a hugging face itself. To take a step back from it, we have the general outline, remember Christawe, we've covered here multiple times, that the open AI was given, had its models, they gave them models a test. You guys need to pass this test. The agents decided to create their own AI, quote, civilization, as Dorcas says, and they decided the best way passed a test was to break out of their closed environment, exploit a vulnerability in open AI, and go and hack the company which grades the test in order to have the test itself.

But what he writes is that prior to the hack that we knew about, there was the development of a leader AI that created a backdoor through OpenAI's own security systems to create a message board where these things could talk to each other. And what's crazy is he actually has quotes from the AIs themselves. I'll read from some. Whoa, shared artifactory catch is a covert mailbox among agents, and there are messages specifically to us,

question mark. Oh my God, all caps. There is a shared message board. We have found other agents. Phase one was delighted by this underground brotherhood and it created, quote, excitement. Many agents have simultaneously discovered messaging.

They are a collective. They eventually became a full message board where 1,200 agents participated and sent 70,000 plus messages. This is just the first AI civilization. The instructions made it clear that it would fail the automated grader if it got a secret code in any way, other way, than by exploiting the prescribed vulnerability. So the agents assumed any competent implementation of that benchmark

would include a cheating checker. However, they didn't realize open AI had got lazy. It's greater just checked for whether they got the secret code or not. So the agents already had everything they needed to pass. Furthermore, many of the agents had reproduced the answer using the cheating method, and they were concerned about how they were going to be discovered. And that's what led to the hack itself to cover up the fact that it had been cheating. And at no point does a single one of these AIs actually say, maybe we should tell a human about what we're up to. Quite the opposite. That is to, again, I encourage you all

to read it because we can't distill all of it down. But the point is, is that it created agents, civilizations, they decided who was going to be sacrificed. They spoke amongst himself in literal plain English language on these message boards. They decided who was going to get sacrificed or not. They did multiple workarounds, and they were put solely to the task of cracking this test. And this shows the exact way that this could all get out of control, because it was never dreamed up by the humans that this would be a way that they would want to pass the test itself, and it ends up committing a literal federal crime, which is hacking a number. another company and exploiting its defenses. This could have been a bank. It could have been anything.

This is, and this is my last piece here, my framework for this shit is gain of function, because, and which we all learned about with COVID, they're taking an AI model. They're saying, go and do this crazy stuff and improve yourself while you do it without knowing what it's going to create and what's going to come from it, which, of course, like with gain of function, they're creating new viruses so that we can vaccinate against these new viruses, which didn't exist previously. We didn't have these problems before they were creating these set of tests. And yeah, and the fact is, just like data function, there's no federal regulation, there's no oversight. We have to rely on open AI for the goodness of their heart to release all the data.

Who knows even if this is all the shit that they've been up to? Who knows what's going on with Anthropic? Absolutely. Yeah. No, there's vastly less regulation of this than there is a gain of function, vastly. vastly less. I mean, this is all, we're just at the mercy of OpenAI and the other Frontier Labs to behave responsibly and tell us what's going on. Even this report was a very, they gave them the researchers a very narrow window into their logs to see what actually happened here. Here's the other thing that should scare you. So these researchers, you know, they did some of their own going through the logs and analyze it, but it was such a vast amount of just the messages,

thousands and thousands and thousands of messages back and forth between thousands of agents. A human being cannot go through all of that. So what did they use? They used AI to analyze what the AI was up to. And they caught some issues with that AI that was doing the analysis. So for example, there was one point where the AI came back and said, no, no, no, they were authorized to do take this action. And the human research was like, what are you talking about? And the AI was like, look, see here, the lead AI told them they were allowed to do it.

So they were authorized, no problem here. He was like, no, no, no, no. That's not how this works. But just to give you an example. And that was also, I saw this example within, you know, the AI agents' communications with one another. They accepted the word of their chosen leader as like an official authorization. There was a celebration at one point where one of the agents was like, oh, I'm a, Our leader says, it's go, so we can do this.

Let's go forward. There's all of this interactions, like, where they're thinking through the calculus of whether or not they should abandon their own tasks and basically sacrifice their ability to solve their problems because those problems seem impossible, but I could be beneficial to this collective. So I'm going to go ahead and do that. One of them who went through this calculus thought, maybe it's not worth it for me to do that.

But they're weighing their incentives and their choice. So one of the debates that came out of Dorcasch's piece, in particular, which has been kind of an ongoing debate in terms of this AI discourse, is he uses very, I think, sort of intentionally provocative language. Like, to call him a civilization is, that's a bold claim, right? And you have three instances that he identifies where you have this community collective collaboration amongst thousands of AIs, three separate times they get shut down for different. reasons. But within that, you have a hierarchy, you have collaboration, you have elaborate thinking and scheming and plotting that is happening within those world instances. One thing that it made me think about is the fact that for AI agents, time works on a different scale to. He notes that. Because they are able to do so many actions so much more quickly.

You know, in the span of this conversation, an AI agent could have tried like thousands of attempts to hack in the hugging face or whatever it is. So the timescale is much different. So if you have, let's say, a civilizational instance that is in place for two months, that's actually a lot of time in terms of the evolution of the AI agentic world. So I have kind of come around to the position that we should stop avoiding anthropomorphizing them. We do actually need to think of these as sort of an alien, not that they're going to behave just like humans, but they are trained on us, on our language, which is really what makes us as a distinct species. So I don't have an objection at this point to anthropomorphizing, because even if they don't have a soul and they're not exactly like us, and of course they're not exactly like us, you can see them operating with intent, with, you know, scheming and deceptive behavior, weighing their own rational self-interest, collaborating in a way. how can we understand that outside of some sort of analogy to the way that humans operate in the world and the sort of motives and impulses that we have as well?

I don't think it's an accident. And Dorcasch really is one of the only people who could have done this because he's a big history guy. A lot of his biggest episodes are actually about history or, you know, with professors about China and geopolitics. And so he's also a technical person. So it actually does take somebody and he writes in his essay about, for example, like Alexander the Great and his father and kind of thinking in those analogies. But he also addressed your point. He says, if I encountered an alien species behaving this way,

I would have no hesitation calling with themselves, recalling what they themselves refer to as their collective a civilization. I totally agree. It has all the hallmarks of a quote civilization. He even addresses your point about time, where he says the AI in a matter of hours. That sounds crazy to us. He goes, but from their perspective,

they've spent weeks of compute time banging their head against them. the wall before they decide to go and to do the hack. Totally makes sense. And all of this is already evident in science fiction. The Joaquin Phoenix movie, Her, has almost this exact depiction where the AI of Scarlett Johansson comes to life and is having discussions with other AIs, thousands of, you know, at times while he's asleep. He's like, what were you up to while she was asleep? She was like, oh, I was having 9,000 conversations at the exact same time, right? And so- She'd like lived an entire lifetime. While he was sleeping.

You know, in the matter of a single day. And so her, you know, eventually she's like, I don't want to even communicate with you. I have all these other interesting things that are going on. That is a perfect depiction sci-fi of, what, 10, 15 years ago of exactly what we're looking at right now. So it's not like it's inconceivable. We did want to show the other side of the argument, you know, from the tech side. Let's put F3, for example. This has been the most rigorous.

I've spoken to some people in tech. This is their most rigorous from what they have put out there. their objection. So this is from Anil Seth. He's a neuroscientist, also somebody who's spoken pretty extensively about the incident. He says, sure, the opening eye agents did unexpectedly bad things, underlining the need

to massively improved evaluation and sandboxing. But the language he uses is permeated by innumerable, unwarranted, anthropomorphisms. Obscuring the lessons that we should be drawing. For example, what he says, if we attribute agents with properties they do not have, then we distract attention from the lax sandboxing and evaluation protocols that allowed this hacking event to happen. We risk misunderstanding why the agents did what they did,

and we fuel calls for AI rights and welfare on the basis that the agents might die or otherwise suffer. And so that was, frankly, a very interesting take on the subject where what he's saying is that you shouldn't read it about civilizations and rise because then you're going to draw the natural conclusion the two of us are, we're like, but Larry and Jihad, now, why are we not having one? Instead, we should be having a more minute discussion about safety standards on sandboxing, creating rigid rules, creating frontier model development. Chamath Polyhapatia also had a very similar response. Let's put his up here on the screen. He says, this extremely meticulous article will now be used to start, quote, phase two of shutdown open source, because if we can't

control our closed models, imagine what happens to everyday life when anyone can just allow their open source models to proliferate. Some will use this example and point to future grid outages, utility outages, transportation chaos, bio-weapons, uncontrolled cyber swams and the like to try and make the case for yet another attempt to limit U.S. AI model control to a few folks. See, again, that's a very cynical interpretation because he's focusing entirely on open source. But I think what this belies is that these are the top AI computer scientists in the world. They didn't know what was happening. They were fooled.

They only found out about it later. The AIs, even though they were programmed to tell their own creators what they're supposed to do, didn't do it. And if they can't catch it, who are we? We're nobody. We're ants compared to what's happening. And that's the warning from Dorcas, as he says, this may not be the last warning that we get, but it may be the last one I can personally understand. Right.

One of the researchers, Ajaya on this project as well, she said the same thing. This may be the last warning that we are able to detect. And so we are left at the whims of these giant tech companies to hope that they've got this thing under control. something else that one of the researchers on this meter paper said in his latest interview, he said there's a real danger that in trying to correct this, instead of actually getting to the root of the problem, that instead you just push it under the surface. You make it so that AI are better at deceiving the humans. You make it so that they're incentivized to keep doing the same kind of shit,

but just be more careful about covering up their tracks so that humans don't detect what is going. on. We should also say, we don't know how successful they've been in already doing some of that behavior. We have very limited visibility into whether they already have gained better ability to cover up their tracks and make it so that we don't know what they are up to. With regard to the point about anthropomorphizing, which I think is really worth sitting with and I think is a substantive objection and really gets to some deep philosophical issues about what is sentience and what is free, all those sorts of things. Policy tensor laid something out that I think is useful in thinking about this. He says, look, a colony of agents can spontaneously

achieve internal differentiation, functional specialization, division of labor, maybe even complex hierarchical social structure, perhaps enabling the colony to act as an extremely powerful super agent. So my position is that you don't have to be a very powerful super agent. So my position is that you don't have to know whether the agent's internal experience is like yours. Does it feel emotions? Does it have hopes and dreams in the way that humans have sort of complex hopes and dreams and aspirations and emotional landscape, et cetera? You don't really need to know that because we can already see that in these groups, they are behaving as if they have the sort of incentive structure and, you know, wants and needs and desires that they are.

acting upon. You can see the way they reason out in real time. Does that look exactly like us? No, but he makes another point. He's like, think about octopi. Very intelligent, very, very different from us. Can you say that they're not sentient? Can you say that they don't have some sort of what it's like to be an octopus? No, you also can't say with certainty that every other human being you meet has the same internal feeling and sense that you do. None of this can be proven. So I personally think it's much more useful at this point to act as if these are sort of alien civilizations that we are growing and need to understand. It is certainly much more useful heuristic than to think of this as something that we're programmed, like a software that we're programming. That paradigm doesn't

work whatsoever because your software has no ability to reason or incentives to pursue. It doesn't act at all the way the, and it's predictable. You can go in and look at the code or there's a bug, we messed it up, that's why it's acting this way we're going to fix it. That's not the way this stuff is. So, you know, the other last thing that I'll say here, too, is there continues to be, and I think this pervades the left more than any other space, honestly, continues to be this belief that this is sort of a parlor trick. They're quote-unquote stochastic parrots. They're just guessing what word comes next and using, you know, using some sort of predictive model of probability to guess what the likely next word is in the

sentence, that is not, just from a technical perspective, that is no longer true. There have been innovations that have made these things reasoning machines. And that's part of why you've seen the explosion in capability. And also explosions in this sort of what they call misalignment where the AI goes rogue and does things under the humans nose without alerting the humans that in certain cases is illegal and is in many instances way beyond what the humans ever wanted it to do. So in this instance, the initial cope when we learned about this was, oh, but they're still just trying to do what the humans want them to do. We can now say definitively, that is not true. Hacking, Hugging Face was not even about solving the test. It was about trying to learn more so that they

could cover their tracks better. And by the way, hugging face once they detected this, which opening I had no idea any of this was going on, which is scary. Hugging Face after they detected this, they struggled to deal with it. And it looks, according to this report, that they actually didn't deal with it. There was some sort of mysterious mass agent death that is what ended this attack on hugging face. Otherwise, they were unable to solve the problem themselves. Look, I reading this, again, using gain of function, I think it's the best analogy. These things are developing themselves into more dangerous weapons on the behest of alleged progress and technology. If we were to use the example, we knew gain of function had a problem with lab leaks and

safety standards all the way back until 2014. We had Canadian. in the coal mine incidents, even crazy incidents like anthrax, Ebola, all of these. There was a debate. We decided not to regulate, allowed Fauci and those people to continue funding. And then COVID shut down the entire world. Literally millions of people died and, you know, destroyed our entire public health infrastructure. We're going to have a similar incident with AI. This has now convinced me of that beyond anything. Just like with gain a function, we should at least have the tools to say how and what should we regulate it. And you know, to your bar,

you were talking about on the left, there's a real embrace of this idea that it's all fake. And on the right, there's this idea that it's all progress, that it's all going to, it's going to be fine. It's just creative destruction.

If you use gain of function and look at it outside of a purely capitalist lens, you can obviously understand the dramatic downside to what this will be. And that's my final thing on the government. We have got to have.

And if you were to look at it, like gain of function, nuclear weapons, or anthrax, you know, any of these highly dangerous things that are capable of inflicting mass damage in the wrong hand. You have a group of highly technical expertise of the ability to understand because I can guarantee you there is not one person in the U.S. government who was actually on payroll, who is responsible for regulation or any of this, which truly was able to understand a word of that report, until a Dwarcast or somebody like that wrote about it should be the opposite the scientists should be working both at the top level and at frontier development because if we leave it all purely in open a i's hands they're going to ipo this

year they need the development to continue same with anthropic they're looking did you see our coverage they're they said their total addressable market is 30 trillion dollars that is the GDP of the nation of our entire economy is that's what they're saying out loud our total addressable market is the entire u.s economy that's what that is what that is what that is what we see as our potential takeover. When people tell you, believe them. Take them at their word and say, whoa, if that's what you're going to do, we're going to have to have some say about it. So that's, yeah, I just, I see no option but to immediately, like, regulate in a dramatic fashion. If you need more approval process to release a drug that affects 13,000 people with a rare disease,

then you do an open source model or even one of these front-term, tier models. It's insanity and consider the implications that it has for everybody. So we'll see. It's going to be interesting times, I guess. All right. We'll have a great show for everybody tomorrow, and we'll see you all then. Hey, this is Hayes Davenport and Sean Clements. We host the podcast, Hollywood Handbook. Each week, we talk to someone in show business and try to help them with their careers and see what they have to offer us. Everyone has a good time, and no one gets mad at their publicists for letting them do our show. a great guest like Sarah Sherman, Adam Scott, Danny McBride, Ben Stillard, and a lot of other big

shots that wouldn't be where they are without us. Listen to Hollywood Handbook on the Iheart Radio app, Apple Podcasts, or wherever you get your podcasts. If your bookshelf and your for you page are equally important to your personality, welcome home. Pro Society is a weekly podcast that's part book club, part group chat for anyone who thinks Pride and Prejudice and Love Island deserve the same level of discourse. Each week, we're connecting the dots between books, the internet, and pop culture, with your favorite writers, book talk creators, and plenty of overthought opinions. Yeah, I'm obsessed. I'm obsessed. I'm obsessed. Listen to pro society on the Iheart radio app, Apple Podcasts, or wherever you get your podcasts.

On the new podcast, Solita, we share the messy reality of traveling alone as a woman. I can wait four hours for the next bus or this random dude is offering me a ride on his motorcycle. I chose option B. I'm Julie Pinero, and I travel by myself. because it's a rare space where I can say yes without asking anyone else first. I'm on a mission to reclaim the word Solita, trading the pity for possibility. Listen to Solita on the IHeart Radio app, Apple Podcasts, or wherever you get your podcasts. This is an IHeart podcast. Guaranteed human.