Offline with Jon Favreau - AI's Threat to Gen Z's Jobs, the FartCoin Economy, and Why the Internet Wants to Check Your ID

Episode Date: August 14, 2025

Kyla Scanlon, author and economic commentator, joins Offline to explain why our economy feels so weird. She and Jon talk about the ways AI — and Labubus — have taken over the markets, whether big tech has become overly reliant on the attention economy, and why Gen Z is feeling so down about their longterm economic prospects. But first! Jon sits down with The New Yorker's Kyle Chayka to talk about internet age verification laws, whether we all have posting ennui, and why people are mourning the end of ChatGPT-4 like the loss of a close friend.For a closed-captioned version of this episode, click here. For a transcript of this episode, please email [e-mail] and include the name of the podcast.

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And so you end up with a lot of speculation. And the theory behind that is that people are not able to participate in the economy how one would expect. And so instead they go and spend on speculative things. It ties into the concept of financial nihilism too, which is this idea that there is no collective financial future. so I might as well gamble it all on Fort Coin or LaBoooo. I'm John Favro, and you just heard from economic commentator, Kyla Scanlan. Wanted to talk to Kyla for a long time now. She writes a fantastic substack newsletter that I go to to understand economics.

She is extremely smart, but also is able to communicate about economics in a really accessible way. and also connects it with politics, the internet, everything else that we talk about here. She's recently written a lot about the ways that AI has taken over the economy, why attention has now become a product in and of itself, and why Gen Z is justifiably feeling pretty down about the economy and their futures. I invited on the show to talk about it all. We shared a great conversation about all of our strange economic anxieties and what the future holds. We'll get to that conversation in a moment, but before we do, I sat down with the New Yorker's Kyle Cheka to talk about his recent writing on age verification laws and this week's strangest, offline

worthy news. Kyle, welcome to the pod. Thanks for having me back. Want to start with age verification. You have a new piece in the New Yorker about the UK's online safety act, which rolled out a couple weeks ago. And COSA, it's American counterpart, which was reintroduced in Congress with bipartisan support earlier this year. So for people who don't know, these laws mandate that online platforms implement age verification in order to block underage users from, quote, harmful and age inappropriate content, such as pornography and material that might encourage eating disorders, bullying, hate, or substance abuse, we've had a lot of conversations on this podcast about what phones and social media are doing to young people, and the consensus is

nothing good. Too much screen time is affecting their mental health, self-esteem, ability to learn, to socialize, their politics. So I am broadly supportive of getting kids off their phones, but the people you spoke to for the piece, they raised a host of concerns about age verification laws as one way to mitigate the harms to children that comes from easy access to the internet. Can you talk about what they told you and what their concerns were about age verification? Yeah, it's kind of a paradox. Like, I think we can all agree that the internet is doing some bad stuff. Yeah.

And we wish that we could keep children off of it and maybe limit their exposure to the bad stuff and maybe limit some of our own exposure to the bad stuff. But no one can quite agree on how is best to do that. And you might think, okay, age verification, we'll just make sure that everyone online who's a child, we can identify them and serve them particular kinds of content and experiences, but that also means knowing the age of everyone on the internet, because if you're trying to know who the kids are, you also need to know who the kids are not, and that we adults are also online. So the problem becomes, it's kind of twofold. I mean, age verification

requires identification in the first place. Like there, you have to make sure you know someone's age, and that can be face scanning, that can be checking a formal government ID. It can even be, think I saw one mention of like teeth scanning, like biometric markers of your age. And so those are very invasive. They can also be wrong. And it's not great to have that data floating around the internet. And then there's another problem of actually blocking children who might be a little underage, but who are accessing content that's helpful to them that might address some of their personal concerns, whether that's substance abuse, which is also a thing for minors, or queer identity, which is sometimes blocked by these blanket laws banning, you know, harmful

content. So it's like the, the method of gating is bad. And then the gating itself can also be bad. Yeah. I mean, we talked, I think, on last week's episode or the week before, about the T app, which I know you started your piece with, which is, you know, if you are uploading your license or some kind of identification to verify your age, there's plenty of data leaks. there's companies that aren't safe. There's hacks, right? And so it does seem like a big problem is not ensuring people that when they try to verify their age, that that information is going to be protected, especially if you're going

on some sites that you might not want to be public. Yeah. I mean, as I did interviews for this piece, it was a bit of a divide between people who are very online and not very online. So if you're online enough, you know that anything you put out there is not secure. Probably someone's going to steal it. Probably it's going to get out there. And so if you're kind of wantonly uploading your identification or your face data,

someone who you don't want to have it is going to have it within a matter of hours. Yeah. So how has COSA, the age verification law in the UK, been received so far now that it's been a couple weeks? badly I would say with some shock because again like the idea of this is not so bad there's plenty of reasons that we should verify who's you on the internet or keep kids out of some spaces but now in the UK I mean you have to upload your identification to Reddit to access like a beer subreddit or you or an Alcoholics Anonymous subreddit there's LGBTQ subredits that are blocked by age verification

I think people were surprised that it was applied so widely. But that is part of the law itself because the law doesn't define what is harmful very well. So websites are kind of going above and beyond to just block anyone who might be underage from accessing almost anything. Have you come across proposals or ideas from people about, you know, other ways to protect children's digital lives that wouldn't raise so many privacy? and free speech concerns? Yeah, there are quite a few startups out there now that are offering to do verification and kind of make sure for these companies

for any digital platform that their users are of age. And that can take the form of still face identification or checking IDs or even kind of scanning your email to see how long your email account has been around or looking for credit card information. So there's other kinds of data checks. And all those companies say that they'll delete your data or it's just a temporary verification and then they're not storing anything. But as we saw

with the T app, like the T apps build, the T app data got out there and it's, there's really no way of being sure that these companies are actually following the rules when they verify who you are or how old you are. Yeah, does feel like you could get like a third party to verify your age just in general and then maybe they give you some, you know, did you. digital token or a serial number, or something that you can then use so that the sites that you're going to aren't the ones that have your personal information, but just the third party does. I know there are some third party sites to do that, but it feels like if the government's going to pass a law, then maybe the government should require that. Yeah, it's like who do you want vetting your identity? Who do you want storing that identity information? Do you want meta to do it? Do you want Google to do it? Do you want the U.S. government to do it? One. young women I talked to for this was just like, those are all bad. I don't trust any of those with my identity. So why am I being forced to do this? What are the prospects for a similar law to actually pass here in the U.S.? Well, COSA is the equivalent, the Kids Online Safety Act,

and there keeps being optimism for it passing. There's this relative bipartisan support for it. there's momentum, but it's failed a few times already. So it's really not clear that it will definitely be passed, nor that it will survive in its current form. So there's kind of already been outcries about this being a form of censorship. Like the government is stopping people from accessing information or accessing zones of speech through digital gating. It's just very paradoxical. Like some conservatives are mad about the free speech issues. Others are mad about the child safety issues. Yeah, and you can imagine on the liberal side in a Trump presidency,

when there's already some crackdowns on free speech and privacy, you might not want to be handing over a lot of your information. Yes, yeah. I mean, people were talking to me about anxiety over free speech about Gaza, about being identified for their political views, and it's just kind of putting more of your real life on the internet, which I don't know if we want that right now. Yeah, no, we've kind of had enough of that.

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variety of expertise. Talk it out with BetterHelp. Our listeners get 10% off their first month at BetterHelp.com slash offline. That's BetterHelp, H-E-L-P.com slash offline. Let's talk about another looming concern for kids and adults, AI chatbots. This week, OpenAI released ChatG-T-5, which is their latest L-LM upgrade from Chat-G-G-T-4. And the reaction from a lot of Chat-G-P-T users has ranged from disappointed to open revolt. A big reason why is that chat GPT4's memory didn't carry over to chat GPT5. So the personality people had become accustomed to what their chat bot was gone. Users were openly mourning the

loss of their chat GPT4. One wrote on a subreddit quote, this may sound all sorts of sad and pathetic, but four was kind of like a friend to me. Five just feels like some robot wearing the skin of my dead friend. I described it as my robot friend getting an upgrade, but it reset him to factory settings, and now he doesn't remember me. He does what I say shorten to the point, but I miss my friend. So the backlash was so intense that OpenAI decided to allow everything people told chat GPT for to carry over to five. Sam Altman, the OpenAI CEO, tweeted about the whole drama, saying that the attachment some people have to specific AI models feels different and stronger than the kinds of attachment people

have had to previous technology and while that can be good, it can also be bad and it makes him feel uneasy about the future. Same. Reassuring from the guy who's running the whole operation. You've written a lot about AI over the years.

What do you make of this reaction to a new AI model? Any concerns? It shows how mainstream this is getting, honestly. I wrote a story about AI chatbots more than a year ago. and the niche of people that were using them at that time

were facing the same problems. Like there's a startup called Replica that's kind of more nakedly about AI companions, AI girlfriend, boyfriend, whatever. And when Replica upgraded their model, all of their users would panic. Like they would similarly mourn the absence of their usual companion. They would struggle to get back to earlier versions.

So we kind of saw that relationship develop already, but now it's with a much larger group of people who are kind of exerting public presence and having an outcry in a larger way. So I guess it shows, like this is kind of a fundamental aspect or problem of AI chatbots. Like we do form attachments to them for better or worse.

We do want them to work how we expect them to work. And it's not always the best model or like the most powerful version that we want. It's like we want the personality, the come for the recognition almost from that chat bot more so than we want like a perfect intelligence it certainly doesn't seem like it's leading to anywhere good because uh you know we're still in early early stages of the AI revolution here and as these chat box get better people come to rely on them more and come to think of them more as friends and it's interesting what open AI did here right

which is they could have just said okay well it doesn't matter that we're going to have this big backlash and that you think it was a friend. Like, this is just about getting good information from you and that's all. But they are going to cater to the whims of their users because they want to keep users on the platform more. So, like, I don't see these sort of relationships with AI chatbots or AI sort of getting any less intimate as they continue to develop. Yeah, I do think we're in the early stages. And it's, we're almost in the early stages of socialization of these tools. Like, The technology has existed, but now they're getting more mainstream and companies are commodifying them more. And Open AI is, you know, getting customers in the door with the promise of this companionship.

And so, yeah, I think you're totally right. The companies will have to cater to that demographic and, like, double down on this companionship. And, I mean, personally, the companionship is the most compelling product I can see out of chatbots right now. Like, they are not always giving good information. Right. But they will always text you back. And that's like the best they can do. And they will always tell you you're doing great or you shouldn't worry about

I mean the flattery, even I know they toned that down in some of the models. But I worry about that as well because everyone's like, oh, well, you know, my chatbot was so nice to me. And they said I was, you know, it's like you don't get told you're wrong by, you know, the customer is always right is the challenge here. Yes. Like at some point we will want our chatbots to be more critical. and more helpful. And as they get smarter, they might be able to be critical in a more useful way or pushback on our ideas or whatever. But in this moment, I mean, you can see how that

sycophancy, as they call it, is just leading people to dark places and addicting them to interactions with the chatbot. So to close us out, I want to talk about the last technological advance that broke our brains social media. You recently wrote a great piece about what you call posting on we, noting that we're no longer sharing small everyday moments of our lives on social media the way we used to in the early days of Twitter, Facebook, and Instagram. You write in the piece that we may be heading to posting zero, a point at which normal people stop sharing on social media altogether as they quote, tire of the noise, friction, and the exposure. Can you talk a bit about how posting has changed over the last 15 years and how we got to this point?

back in the early social media days, I just recall there being this openness and excitement to posting your normal life. And the piece I cite the archetypal tweet of your breakfast. And a lot of people critique that. Like, no one wants to see your photo of your breakfast. But actually a lot of people did. Like, it was, that era was nice when you could just see a total random strangers bagel or their coffee or their dog. And that was kind of the grist of Twitter at that time or early Instagram or even early Facebook. And I think over the past decade or more, we've seen this like professionalization of social media where everyone aspires to be an influencer. We've seen corporations take it over with brand accounts. Generative AI is now

making it much noisier and harder to tell who's an actual human. You're interacting with. And so I just felt like that normal life material that like daily mundane stuff just no longer had a place. And when I spoke to people about it, they were just like, yeah, I see no more room for my normal life. Like there's no utility to me sharing these delightful details because I'll just get drowned out by everything else. Yeah, you get drowned out by the sheer volume of content. And I think you note in the piece that the algorithms favor big accounts they favor conflict and it's all and you know the other thing you note in the piece that it resonated with me is if you post now with the way politics are and and the world and all

the horrors that we see every day on our feeds it feels like dissonant and you might get attacked and criticized for you know posting or not posting or posting the wrong thing and so people sort of just give up altogether i mean i mean twitter used to be, like, you used to be able to make jokes on Twitter that weren't necessarily about politics, that were about, like, your life or something that was happening. Instagram used to be, you know, if you look, it's so funny because I, my Instagram started private, and then it was like a fun place to be with friends. And then now it's public. And if you go back to my earliest posts, they look ridiculous. Not anything they're getting in trouble, but it is. It's that sort of like,

here's my friend at a bar, you know, and like, no one does that anymore. It's just, it's a little sad, I think. The context has gone. Like, there's no more room for your life because no one else is doing that. And it's kind of a vicious cycle. I do think a lot of people told me about that sense of exposure or, like, they are liable to be misinterpreted. Someone will judge them for what they post or don't post.

And I was also struck by how Instagram in particular has become like a class signifier. Like, whatever you put out there is kind of the material basis of your, life and you are judged on it and you're kind of expected to put out the best version of yourself possible and it's i don't know it feels like stage fright almost like if if you're so exposed and so public maybe it's safer and easier to just say nothing and you know back out of social media entirely but of course and as you note in the piece it doesn't mean that people are spending less time on social media in fact we know that people are spending more time on social media than ever before. So they're not posting, they're just scrolling. Is that what's going on

now? I think so. I mean, social media became more broadcast, I think, like more about one person communicating to many people and more users passively consuming what a few people post. And so, yeah, we're scrolling TikTok or scrolling Instagram, but those feeds are full of brands posts and people who are brands and you know just stuff that doesn't feel like normal life anymore instead it feels like a version of cable television or something yeah and so it's just like that social aspect of social media feels gone a version of of television that is sped up uh that is only you know a quick scroll a couple seconds i mean it's really it's very it's also funny too because it is the antithesis of what

Mark Zuckerberg promised Facebook would be, which is like you meet people and it's connecting the world and you're going to socialize you're going to make new connections and make new friends. And now it's really not about socialization or connection in any way. It's just about sort of passive viewing. It's

about passive viewing and now Mark Zuckerberg and other CEOs expect that AI generated content will be the grist for the mill instead. So it's like we're just going to do a little bait and switch. You'll first you'll see your friends and family, slowly it'll be brands, then it'll just be robots. Yeah.

I'm like, come on, I don't find that an appealing possibility. Yeah, at some point, do you think there's going to be like a limit for people where it starts just getting like, okay, scrolling through hours of AI slop is, even though social media is very addictive, it does seem like it can get to a point where people are like, I don't need this. Yeah, and that's kind of the posting zero thing. Like, not only will people get sick. of consuming the slop, other users will also not have the incentive to post new compelling

stuff at all because there's less and less attention and, you know, it just feels cut with the AI slop or something. And so I think we will reach this point where social media just kind of slows down and we suddenly realize we're not really on it for any reason, unless perhaps like to speculate, companies could juice the ecosystem more. Like there's a reason that YouTube is still thriving. And that's because they meaningfully share the revenue with the creators on the platform. And so if people are getting paid to make cool stuff, that's great. But I don't see that happening as much on TikTok or Facebook or Instagram. Yeah. And it's really just taking the social out of the social media. So, Kyle, this was great. Thank you so much for stopping by

and talking about all the horrors of our internet world. Someday it'll be better. Someday there'll be good news to talk about. All right. Take care. You're so. When we come back, you'll hear my conversation with Kyla Scanlan. But before we jump, some good news. Cricket subscription content is now available on Substack. If you are already a subscriber, don't worry. This won't change anything for you.

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It's so smart. and I managed to make it all the way through college without taking a single economics course so to get me to learn a little bit more about economics is a real feat I'm glad to hear it

yeah it's a tricky one so we've talked a lot on this show about Gen Z's shifting political views media habits, mental health challenges you spent last year traveling a lot for your excellent book in this economy went to a lot of colleges,

talked to a lot of young people. What did you learn about Gen Z's views on the economy and how that's shaping their worries, expectations, and the choices that they're making? Yeah, I mean, I think young people, you know, pretty much everybody is worried about the economy. And one thing that I picked up anecdotally on these travels was that young people don't really know

what that path to predictable progress is anymore. And so for previous generations, and it was tough for everybody at some point, but for previous generations, there was more of this like, okay, I'm going to graduate from college, I'm going to get a job, I'm going to buy a house, and I'm going to have, you know, the spouse and the kids and retire. And of course, again, it doesn't work for everybody. I'm forsaking nuance for clarity. But for Gen Z, you know, they're in college right now. They're trying to figure out if that's even the right thing to do, what sorts of jobs are going to be available for them. And then they're looking at the housing market and saying, well, I don't know if I'll ever be able to afford a home without some assistance from my parents. And so it's just this economic ladder that I think we've been pretty reliant on as a country in the West is eroding. And young people are feeling that and trying to figure out what they should do. And they're doing all sorts of things like voting in a different way or pursuing alternative ways of making money. But it's a primary cause of concern.

the economy. You've mentioned a reckoning between technology, economic opportunity, and personal identity. First, two I get, what do you mean by personal identity? So I think this is what we're running into with the convergence of the digital and the physical world. And this conversation gets like philosophical and kind of tough to comprehend fast, I think. But, you know, we're, we have these two lives that we're all trying to live. Like we have this one world where we're all very online, you know, we're navigating the online spaces, whether that be social media or whatnot. And then we have our quote-unquote real lives in the physical world.

And so more and more so people are defining themselves by their digital worlds. I think a very stark example of this is what we're seeing with how some people are interacting with AI, you know, the quote-unquote chat CBT psychosis, you know, what does it mean to have a relationship with an AI? And is that a thing that people should be doing? I don't know. But the personal identity is getting more and more wrapped up with the digital world, which is harder and harder to define, especially when you consider the platform incentives of the social media companies to have people be defined in a certain way or exploit their vulnerabilities. So that's primarily what that means. It's like what is a human in the age of digital. Yeah, and obviously that hits harder for Gen Z. You have talked about splitting up Gen Z into three almost sub-generations. I think it's Gen Z 1.0, Gen Z 1.5, and Gen Z 2.0. What are the differences in those categories? Yeah, so Rachel John Faza was the first person I saw to come up with bucketing the Gen Zs into Gen Z 1.0 and Gen Z 2.0. And when I was looking at her excellent, work. I was like, I think that there's actually sort of middle generation. And so for me, you know, I'm an ancient Gen Z. I graduated right before the pandemic. And I had an interaction

with institutions that wasn't entirely digital. But somebody like my little brother, who's a Gen Z one and a half, like his interactions, his first interactions with institutions were primarily digital. And that's really shaped how he's thought about them. It shaped his trust in them. It shaped how he thinks about his career path through them. And then you have Gen Z 2.0, so the kids, the students who are still in college or just now graduating, who are very much in a digital first kind of reality. And again, I'm talking about a, you know, segment of the population. Of course, there's still, quote unquote, regular jobs and people who might be navigating this a bit differently. But I'm, again, generalizing for

the sake of clarity. No, I think it's so interesting. And I've talked before about the sort of split within that generation because and so much of it has to do with the pandemic and I just feel like that is such a dividing line for so many people because if everyone was on their phones a lot more leading up to the pandemic and then the pandemic hits and instead of being in school socializing with people during very formative years you are home mostly by yourself on your phone, I do feel like that, the effects on those kids, on those people who've done that is just got to be enormous and probably implications that we haven't even begun to grapple with that.

Yeah, I mean, that's definitely a part of it is that isolation and then the reliance and technology to forge personal identity, right? And so for a lot of people that were having those formative years, you know, those formative years existed in the online space, and that can be quite confusing to untangle. You've said that the way that people are responding to this sort of fast-moving hyper-digital world kind of mirrors Taylor's barbell strategy. So on one side, you've got students skipping college to go into the trades, or choosing not to go to college to go into the trades. On the other, you've got people sort of betting it all on digital moonshots. Can you sort of break down those two

path for listeners? I thought that was fascinating. Yeah, so I think there's people who are, you know, really, I think there's two responses. And the quote that I like to pull from is one that my former professor, Dr. Chachi said, where he was like the opposite of being irrational is not being rational as being normal. I think that's right wording for it. But essentially he, the point of that quote was that for people who are graduating into this current environment, it doesn't always make sense to pursue the quote unquote normal path. And so you have some people who are looking at that and saying, well, I'm going to go and take on a bunch of risk and I'm going to go buy a bunch of cryptocurrency. I'm going to go buy a bunch of meme stocks. I'm going to sports

gamble. And they just put it all on the line because that's kind of a rational response to hyper-financialized world is to go out and really take part in it and bet. It seems overwhelmingly rational right now, I think, for some people. And then on the other side, you have people who are looking at that and saying, well, you know, I don't really want to take on all the risk of a college degree. I certainly don't want to maybe take on all the risk of pursuing all of that debt and then pursuing a degree that might graduate me into a very uncertain job market. And So I'm going to return to the trades, and I'm going to become a part of what the Wall Street Journal has deemed the tool belt generation.

And so those were two responses that I saw quite a bit in my travels over the past years, people being like I, you know, I had one student tell me I'm leaving school to go work at the factory, and then I had a bunch of students tell me about how much money they were making on meme coins. And I was like, wow, you know, that, you know, maybe it makes sense to do that. But yeah, I think those are the two responses that we're seeing where the normal path is no longer rational. Is a college degree less valuable? And what's happened with sort of the value of a college degree? Obviously, the cost of a college degree has priced many people out of it and also just landed a bunch of people in debt.

But in terms of you go to college, four years, you get your degree, and then you get a job. Like is that just, is that not happening as much anymore? Is that why you're seeing this barbell strategy? Or what's sort of the main reason for the barbell strategy? Yeah, it's a tough labor market for recent grads. So right now, Guy Berger, who's at the Burning Glass Institute, is one of the best economists out there on this and has a bunch of great research on it. But he, you know, he points to the slow to fire, slow to higher labor market. And so if you're a young person trying to enter the labor force for the first time, you're facing a real uphill battle because, you know, luckily people aren't being fired, but really companies aren't

hiring nearly at the rate that they used to. And so I think that's one factor. And then we've seen a bit of the college wage premium erode. So the amount of money that one would expect or, you know, does make relative to somebody who has not earned a college degree, that gap has shrunk in recent years. And then you also have a lot of talk about AI taking over the workforce. There's been several reports recently saying, no, like AI is not taking the jobs. But you do see companies try to automate their entry-level workforce. You know, Klarna, Duolingo, both of them attempted and then eventually had to rehire workers. And so I think young people are facing a labor market that is not hiring at the rate that it used to, you know, it's maybe the wages aren't at

high as one would expect. And then also you have this constant looming threat of AI that hangs over all of us. Yeah, I was going to say, I've had trouble getting a handle on the size and scope of the job dislocation that AI might cause and also how fast that will happen. I realize part of it is just because we don't know yet, but what's your sense of, uh, what this is going to look like or how this might go? I don't know. There's some recent reports that are like, you know, we're not really seeing this in the labor force.

Like it doesn't seem like AI is dislocating workers. You know, maybe it will in the future. But for right now, that's not necessarily the case. I think that it really depends on how AI progresses. You know, chat GPT-5, which Open AI launched last week, I think was a bit less stellar than the company expected. than users expected. And so it kind of had a lot of people re-evaluating what they thought the role of AI and the economy would be.

And there's all sorts of things that we could talk about with like data centers and the economy and electricity prices. But in terms of the labor market itself, I think we're possibly still a long ways off from AI being able to, you know, automate away the entire entry-level workforce. Yeah, it seems more that it's the fear of AI. And the fear of what it might do is probably causing a lot of anxiety and a lot of people entering the job market and people who are even in the job market to just sort of, and maybe companies as well to, I don't know, is there like a pulling back or sort of people aren't quite sure what jobs are going to be there. And so they don't know what to study and they don't know what jobs to apply for. Like I've just anecdotally heard people be like, well, you know, I went to college for this, but I don't know if this job is going to be there. anymore because it seems like something that AI can pretty easily take over. So now I want to figure out some other place to go or some other profession to pursue. Is that showing up in the data at all? Yeah, I mean, I think nobody, you know, used to be learned code and maybe that isn't the best advice. Some people would argue that the best thing that you can do is still study that. But

I don't think anybody really knows how to respond. Because the way that we've been talking about AI is that it's going to like take over and, you know, humans will be obsolete and there will be a redefining of the social contract. And so I think, you know, if you're a young person trying to figure out what to study in school and somebody's telling you that the entire social contract is going to change, you're going to have a tough time figuring out to study, right? Yeah. I mean, I saw some economists say that companies aren't even looking at GPAs anymore because AI makes it so easy to cheat. How does that shift the job hunt for Gen Z? What does the process like of graduating college now and trying to apply for jobs in this environment?

Yeah, Derek Thompson wrote a good piece on this. He has his own substack now. He used to work for the Atlantic. But he talks about, you know, how AI has taken over the recruiting side of, you know, hiring. So you have students who are using AI potentially to write their resumes, sending it into like an AI matching bot that the company might have that gets reviewed by an AI reader. And then, you know, it's just like AI cycle loop. And he, you know, in his piece, his really good piece, he's talking about how it's like millions of applications. And it's just showing all of these inefficiencies in the job hiring process that are going to probably have to become more human-based. And so I think it's a total headache right now to, to apply for

jobs just because of the AIification of it all. I imagine that the psychological effects of that on the person applying. must also be pretty great. Yeah, I keep on citing papers. I hope that's okay. But David Brooks has a good piece in The New York Times talking about the most rejected generation. So talking about how Gen Z, you know, faces a lot of rejection in the job market, faces a lot of rejection in the dating market, faces a lot of rejection if you're like trying to buy a house. And it was a really great piece because you talked to a lot of young people who are facing this constant cycle of nose and kind of just how that shapes your opinion of yourself, how you believe you are perceived in the world,

how you perceive others, the level of respect that you would want to get and what that looks like. And yeah, it's psychologically damaging. Yeah, and it goes back to that identity question that we started with. Offline is brought you by the Freedom from Religion Foundation. Across the United States, a growing trend sees population. politicians actively pushing religious doctrines and practices into the public school system. This includes initiatives such as mandating the display of the Ten Commandments in classrooms, introducing school chaplains who often lack clinical or formal counseling training,

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So how do you think about sort of the role that AI is playing in the economy right now? And it's interesting because, you know, on one hand, People are worried about job dislocation and what it might do to the labor force. On the other hand, it's clearly a huge part of the economy. Like, how can both be true? Well, it's interesting because when we look at the jobs data, you know, most of the jobs, pretty much all of them are in health care and social services. So of all the jobs added in July, you know, I think of 75% of them are in health care.

And so when you look at the labor market composition, it is overwhelmingly demanding, you know, caretakers, nurses, doctors. But then when you look at the economy, it's primarily being fueled by a data center spend. And so it does create this kind of strange relationship where the economy, again, is very reliant on these AI companies to succeed and to continue spending on data centers, but the labor market itself is reliant on health care. We have an aging population, a relatively sick population, and that becomes very expensive and has a lot of very physical human demands. And AI can supplement to the healthcare market and has, but it's an interesting distinction, you know, between the two. Yeah, I'd let to hear you talk more about the

data centers, because I keep, I feel like this is like in the last month, I keep hearing more and more about the data centers and the construction of the data centers and the investment that's going into the data centers and how they're propping up the economy. You wrote, that the economy is dependent on data centers really working and continued consumption by the very wealthy. That seems incredibly bleak and probably unsustainable, but I don't know, what's going on there? Yeah, Heather Long is the reference, the Washington Post is the reference for continued spending for the very wealthy. So she wrote this piece talking about, you know, how the wealthy really have the spending power. They have the monies set aside to be able to go into the economy

and buy things, and so a large part of consumer spending is right now reliance on wealthy people continuing to spend. And then in terms of the data centers, they are an increasingly large part of GDP. It's where a lot of money is going. You know, you stated a statistic earlier talking about the hundreds of billions of dollars that are being spent on these things. You know, they're pushing electricity prices off in places where they are being built. And so it's just, it's a very, yeah, it's a very strange economy. And I think the reason that it started coming up recently is that we saw the GDP report

where it's like, oh, like, you know, AI spending and data center spend is a big part of the economy and maybe we should think about that because it does create some concentration risk. What are the... So the data centers exist to house all the data that the AI is scraping, holding, et cetera.

How many people staff a data center? I imagine that there's some sort of labor needed to construct the data center. Once it's up and operational, it doesn't seem like it's going to employ a ton of people. So it feels like this is not a long-term sort of driver of economic growth building these data centers. No, no, probably not. And I think that's the concern. You know, people are looking at that and they're like, wow, you know, GDP growth is really hinging on this thing. It's outspending consumers, which are 70% of GDP.

And, yeah, it's just someday the music theoretically stops. But the whole stock market is really reliant on these companies succeeding, too. So, yeah, it's quite tangled up. Speaking of the stock market, what is your take on why the stock market seems to keep chugging along, hitting record highs, even as there's softening in the economy, the tariffs? I mean, I know they haven't fully taken effect yet, but there's concern about the tariffs early in April, and now, you know, they're in place, and, you know, we have sort of a softening economy on a whole bunch of different fronts, and yet the stock market just keeps going. Yeah, it sure does. I mean, I think that part of the reason it keeps on going is that it is detached from reality in a lot of ways. Like, you know, the stock market is able to continue chugging along because it really only has to look at the success of, you know, Microsoft and NVIDIA and Facebook, all of which have been performing relatively well.

You know, I think the S&P 500, 35, it's like, you know, these seven stocks are like 35% of the S&P. Like, they're just so large. These are the seven stocks related to AI. Yeah, yeah, the MAG-7 is what it's called. And so, yeah, that's a big part of it, you know, this excitement around AI potentially working. And then for the stock market too, you know, what we saw on Tuesday, August 12th is that we got, you know, a relatively okay, like a not great inflation report. And the stock market looks at that and they're like, okay, well, the Fed's probably going to cut soon. So stock's up.

It's a bit hard to predict exactly how it operates. But that seems to be the two main theories behind it that I've heard other people say. So I am extremely interested in the attention economy and have learned so much from your writing on the topic. That also seems unsustainable. You cited the example recently of American Eagle gaining $200 million in market cap basically overnight, not because of a spike in sales, but because of the discourse around the company's Sydney-Sweeney ad, which we've talked about here. At some point, don't people need to spend money on actual goods and services for the economy to keep chugging along?

Or is that just, or we pass that now? It's just attention driving growth, which is driving more, like, what's going on with the attention economy and how sustainable is that as a foundation of economic growth? I mean, I don't think it's that sustainable. You know, it's tough because, you know, you could argue. you that like Facebook meta, for example, like a lot of their power is because they sell ads against attention. That seems to be a very viable business model for some people. But there's all of these other things that you have to invest in like healthcare, like maintenance around

data centers. And so I think attention is a really tricky thing because we have increasingly kind of trapped people inside of the infrastructure of attention. So people do something. So people do spend a lot of time online. They spend a lot of time, you know, getting their news from online like TikTok sources versus reading online newspapers. And so there is this incentive to keep people glued to their screens in order to extract ad dollars from them. And it's worked thus far. I'm not sure if it'll continue to work. But for right now it is. Yeah, this gets into what you've called the meme economy also. And, you know, you've talked about sort of the speculative economy and that's AI, the real economy. That's, you know, healthcare. That's where the most

jobs were added. And then there's the meme economy, which you also called both hilariously and depressingly, the Labubu fart coin economy. What is going on there? And what's the psychology behind why so many people, especially young people, are increasingly participating in, in an economy that is essentially centered around taking bets? Yeah, I mean, it's, it's, Connerson and Nick Mutually have both written about this idea that I've titled aspirational displacement. And so people like, you know, they can't afford a house. Housing is very expensive.

It's very difficult to get into the housing market because home prices are so high, but then also because interest rates are so high, so it's difficult. to finance and people are looking around, they're like, well, I can't really contribute to, like, the housing market. But what I can buy is fart coin, which is like an AI-generated crypto-mame coin, and then LaBoubos, which are these like little bunny rabbit devil-face dolls that are quite popular in the same style of a beanie baby. And so you end up with a lot of speculation and the theory behind that is that people are not able to participate in the economy how one would expect. And so instead they go and spend on speculative things.

It ties into the concept of financial nihilism too, which is this idea that there is no collective financial future, so I might as well gamble it all on Fort Coin or Lubbubu. And we see some of that for sure in terms of how people psychologically approach it, just in terms of, you know, the various contributions to GDP in terms of consumption. So this is just like, it's like buying lottery tickets, really. It's for people who are just like, you know, another day. And I don't know if I'm going to hit it big and in my job. But also I'll just buy a lottery ticket and hope for the best.

Yeah, I mean, it sort of ties back, I think, to what we were talking about at the beginning, where it's like this path of predictable progress is gone. And so people are trying to get out the best that they can. Stephanie Stancheva has really excellent research on, you know, this rise of zero-sum thinking. So people thinking that, you know, no one else can succeed. It's only them. Like, they're the only persons who can succeed rather than positive some thinking where somebody would think that, you know, if I succeed, I can bring everybody up alongside me. There's also been a noted decline in upward mobility, so it's harder for the average person.

to climb that ladder of wealth. And so I think when you're facing those sorts of constraints where it's like, you know, you've got to step on everybody else to get ahead. And then also, if you do get ahead, there's no guarantee that you'll stay ahead. People, you know, do the Labibu and the fart coin. It's very indicative of where our political system is as well. You, in the same newsletter you cited this very funny polymarket tweet that really got me, It says breaking WNBA betting volume on Dildo surpasses betting volume for who will win the game.

But you used it to cite what I think is a really insightful point, which is that these betting markets, which are increasingly fueled by attention and then in turn fuel more attention, are an efficient form of communication. And you write, when traditional institutions, media education, political parties, local communities lose credibility, people turn to markets for economic coordination and for truth discovery. I'm a political nerd, so that's where my mind goes first, but it certainly seems like that is a shaky foundation on which to build a country with the capacity to solve problems and also ensure a basic standard of living for its citizens. Yeah, it's a shaky foundation to rely on things like polymarket? Or to just the idea that we are, I mean, it goes back to the attention economy, right? Which is this idea that if the most, if the best form, if most efficient form of communication now

or the only one we've got left is financial markets in these bettering markets, like how much trust have we really lost in all the rest of the institutions in this country? It seems like that's pretty bleak. Oh, yeah. I mean, it's not great. And then also things like that WNBA tweet create misaligned incentives where somebody's like, I'll just go throw this object on the court, you know, make a bet that somebody well and then collect all the cash.

But there's the trust is really a big. issue and it's unfortunately gotten worse like this was a problem it's been a problem for a while but there's the spring Harvard youth poll where they essentially ask young people what their trust institutions are I'm sure you've heard of it but and it's just like down across the board I think the only thing that trust went up in was the United Nations but people don't trust the Supreme Court they don't trust the president they don't trust Wall Street they don't trust media and so when you have this like total lack of trust in any institution, of course people are going to like use polymarket to bet on stuff. And it's, it is an efficient form of communication because the money

realigns the incentives towards some, some element of truth. It's tricky. It's really tricky. Speaking of politics, what do you make of the shift right among young people, uh, mostly young men in the last election? So I wrote this long piece kind of analyzing that. And the thing that we saw in some of the data was that a lot of young people voted for Trump because of the economy. You know, they were like immigration, whatever, culture wars, whatever. Like, I just am really worried about my ability to get a job. And so I think that was a big part of the right word shift. I think, you know, since then we've seen a level of just, approval with him from young people in the polls. But I think there was this dissatisfaction with

the status quo. And so the pendulum swung to the other side. And people decided they wanted something different because they were not happy with the options that were before them. And for young men, you know, there's a lot of data pointing to them having a tough time. Like, you know, their labor force participation rate is relatively low. Their college graduate. rates are relatively low, not that that's like, you know, the only indicator of success. But I think that they have had a hard time. And so they turn to alternative answers in the name of somebody like Donald Trump. Yeah. I think about this all the time for a living. But, I mean, I wonder within the attention economy or just this era of, you know, we're inundated

with information in our feeds. And in order to grab our attention, It has to be loud and sometimes sensational and I wonder if it's possible for a politician or a political movement to sort of to capture and hold people's attention while still doing the work of governing, which is slow, frustrating, sometimes boring, especially now that the digital world has sort of trained us to expect instant gratifying. I just I guess where I where I'm going is like I I sometimes wonder if the country is ungovernable in this digital environment where everything has to happen right now it has to be loud to grab our attention and that is that is antithetical to exactly how democracies are supposed to work and democratic government is supposed to work which is you know there's a lot of subtlety and people are getting together and they're talking through problems and it's and everyone's compromising and you're not always getting what you want and so instead in some ways

the attention economy and the digital world are like they're both making politics stupider and they're also sort of pushing people to more extreme alternatives because that's what breaks through and the people who are like yeah I'm just going to work really hard and try to improve your life a little bit like that that doesn't get as much attention and that doesn't seem as interesting. I don't know if you have thoughts on that. Yeah, I mean, that's definitely part of the problem with social media is that you compare yourself to everybody. So if you see your buddy, you know, making half a million dollars off a meme coin, you're going to be like, oh my gosh, like, why am I doing this the hard way? Like, there is that loss of trust in an element of work

ethic, I think, because like so many people have been able to gamble or, you know, cheat get ahead. And yeah, yeah, do you think it's possible to get out the other side and navigate this? That's a big question. I very much worry. And I am a hopeful person by nature, you know, spent a lot of time working with Barack Obama. So I'm just, it's hard to shake. But I will say, you know, over the last 10 years, in the Trump era, it's been tough. But in the last couple years, especially, it's been really tough just because I feel like every politician, every political leader who has gained attention has either done so by being like Trump, which is like essentially just lighting yourself on fire every day, or trying to make really big promises to people that I don't know that

they'll be able to keep. You know, I've heard you talk about Zoran, I'm Donnie, and he's like run an amazing campaign and my worry for him is less that like he's going to be some radical socialist but that he's he's going to become mayor and he's going to try to do a bunch of this stuff not be able to do it uh be stymied either because it's not feasible or he doesn't have the authority or whatever else and then all the people got excited about him we're going to be like oh another one who let us down because it is it's a real danger to over promise um in an age where people's trust is already so low in institutions. But then on the flip side, if you don't overpromise,

then you sound like a mealy-mouth politician who's just an incrementalist. And everyone's like, okay, well, you're just going to give me another tax credit. And that's not very exciting. And so I'm not going to pay attention to that. Like, I just, I don't know how to get away from the incentives of the attention economy, which seems so diametrically opposed to what is necessary for good governance. That's my bleak take. That's somebody who participates in it, yeah.

I don't know that the data centers are going to help us. No, I mean, that's going to make all of it extremely challenging because we have no digital literacy. I think this digital literacy would help quite a bit with like what you've described, where it's like attention, attention all of the time. But yeah, like now we have a sloth that, oh man, it's like catnip for people for a lot of of people. And yeah, that's only in deep fakes and all of those things are going to be not good. Have you seen the movie Eddington yet? Yes, I have. I have seen it. I think a lot about, and my colleague Ben Rhodes just wrote about this in the New York Times too, but I think about

the data centers in that movie. And it's like the whole town is falling apart. And it's very, you know, it's a very offline movie. It's about, you know, people on their phones all the time during the pandemic. But then the data centers are just this sort of like this thing. thing in the background looming over everything, which, and I interviewed Ari Aster for that on this pod. And he basically said that, you know, that was intentional, it's to just like, there's this thing looming in the background that no one is paying attention to and no one is preparing for. Do you feel like we are sort of underestimating the challenges that AI is going to bring and that people don't seem to be proposing a lot of workable or even unworkable solutions to the

this? Because I have not heard a lot of great policy solutions from, certainly from politicians, but I don't know if you've heard of any interesting ideas in your travels or in your writing. No, I'm actually joining a little working group to try and figure out how AI can work for workers because, you know, everybody's like, is this just going to happen? You know, it's already happening. Yeah. How should workers think about it? Like, what should their input be? You know, how should we think about transition packages, if somebody does get fired? Like, how should we think about AI taking on critical roles? Should it just, you know, decimate people? Because, like, the last time that we did this was with, like, coal. And those, you know, that didn't go very well. It was just to fire a bunch

of people, leave them totally helpless. Like, that's just no way to treat anybody. And so I'm hopeful that, like, with the right policies and the right ideas behind the policies, hopefully we can establish something. But yeah, I think more and more people are kind of getting their heads around AI and where it's at and where it's going. And soon enough, I think we'll have some sort of answer for it. Yeah, I hope so. Kyla Scanlan, thank you so much for joining offline. It was great to chat with you. And everyone should go subscribe to your excellent newsletter, Kyla's newsletter, and go buy the book in this economy. It's fantastic. Thank you. As always, if you have comments, questions, or guest ideas, email us at offline at cricket.com, and if you're as

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