Pod Insights a16z Podcast Why America Must Lead in AI Investment with Senator Young (R-IN) About this episode Senator Todd Young (R-IN) speaks with a16z General Partner Martin Casado about the importance of open innovation and American leadership in AI, and why we need to support AI research at all levels — from the classroom to the war room.
In this episode, we distinguish science fiction from science reality in the ever-evolving AI landscape.
Transcript Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.
0:00 Speaker 00 This isn't a particularly partisan issue. I think there's a tendency to catastrophize different technology areas as opposed to different potential outcomes. My colleagues typically don't think of an investment in the National Science Foundation as a national security investment, but it is.
0:21 Speaker 00 I think what you may have characterized in the past as fantastical, some fantastical doomsday scenarios, and there are a lot of those. And there may even be a couple that are real, and we need to hedge against.
0:34 Steph Smith? Depending on who you ask, conversations around AI range from solving the world's toughest problems to triggering an irreversible apocalypse.
0:42 Speaker 00 We're going to rapidly compress the treatment and drug development timeline. We will come up with drought-resistant, climate-change-resistant crops that'll feed the world.
0:53 Martin Casado? Do you think that Pdoom, or Pdoom is a probability that we's humanity has a catastrophic event, do you think it's greater with or without AI?
1:01 Steph Smith? But these very fears and fantasies go back as far as 1863, when English writer Samuel Butler, inspired by Darwin, wrote a newspaper article suggesting that humans would create their own successors. A, quote, "self-regulating, self-acting power that would make us the inferior race." And who could forget the murderous Hal 9000 in Stanley Kubrick's 2001: A Space Odyssey, or the dystopian crime prediction tech in Minority Report, or even Pixar's starry-eyed robot, Wally? All of which have shaped our relationship with the kind of science fiction that now in some way is becoming science reality. And as this is happening, everyone is weighing in. From the researchers building the technologies,
1:44 Steph Smith? to the funders ushering in the next wave of infrastructure, to even the consumers reimagining the ways that these tools could be used. And of course, governments too are increasingly paying attention.
1:56 Martin Casado? This is going to be another 10x expansion in value, for sure. And historically, the US captured that, right? That's like why the internet age was so great for us, right? And so is that part of the calculus? Or is the focus really on like, how do we keep this stuff from hurting us?
2:09 Speaker 00 We also need to embed the standards that we have as it relates to privacy, consumer protection, and other things into those technologies, rather than leaving it to, I'll pick on the Chinese Communist Party again.
2:21 Steph Smith? And that's why Senator Todd Young and three of his colleagues hosted the AI Insight Forum, a series of roundtable events that brought together lawmakers, business leaders, government agencies, and the greatest minds in technology to grapple with AI at this absolutely pivotal moment in its evolution. And in today's podcast, A16Z general partner Martine Casado sits down with Senator Young to discuss what they learned from the forum, where public policy meets AI, and how the United States can remain a global leader in this emerging technology, striking the right balance between innovation and regulation. Senator Young has represented Indiana in the Senate since 2016, while Martine currently sits on the board of several AI companies, like Ambient AI and Pendrop Security,
3:06 Steph Smith? but also has long been involved in the intersection of technology and the government. In fact, he started his career at the Lawrence Livermore National Laboratory, working on large-scale simulations for the Department of Defense. So as we collectively seek to distill science fiction from science reality, here are Senator Todd Young and Martine Casado.
3:28 Steph Smith? As a reminder, the content here is for informational purposes only, should not be taken as legal, business, tax, or investment advice, or be used to evaluate any investment or security, and is not directed at any investors or potential investors in any A16Z fund. Please note that A16Z and its affiliates may also maintain investments in the companies discussed in this podcast. For more details, including a link to our investments, please see a16z.com/disclosures.
3:58 Martin Casado? We're going to cover in general like how policy intersects with AI and how we're thinking about it and how do we keep the United States ahead. As part of that, you had this Senate AI Insight Forum. I thought maybe you could first just kind of describe what that was, then we can talk about what the follow-up has been.
4:13 Speaker 00 Sure. Well, Martine, thank you so much for having me. This is a great event. I understand your speakers shared some great information today. For those who may not be familiar with how Congress typically does its business, when we're really following the normal processes, we work through the committee process. So if we had gone the traditional route and trying to address artificial intelligence issues, that would have meant that a number of committees of jurisdiction would have started to hold hearings on artificial intelligence in a very public way. Members of their staff would have prepared members hours before each given briefing, and we would have learned what we could from those experts who briefed us over the course of two or three hours. But oftentimes, members aren't able to dive deeply into the
4:57 Speaker 00 essence of various policy issues when we take that approach. So instead, Senator Schumer, working with three other senators, decided to deviate from the process. Instead, we held first three briefings and then nine, as you mentioned, AI Insight Forums. These were roundtable events, long tables full of talented innovators, entrepreneurs, policymakers, and others. No cameras were present, as is typically the case in our hearings. So there's a lot of candid conversation on dedicated topics. We held Insight Forums on national security, alignment, innovation, and other topics. And members were invited to witness these guided conversations, take extensive notes. And then after that, we have a lot
5:40 Speaker 00 of work product that we can deal with, recommendations, policy concerns, and other things that will lead to actual committee hearings and legislation being proposed, as is traditionally done. So those were really constructive. Members gave a lot of positive feedback about it. We learned a lot in the process.
5:57 Martin Casado? What are your key takeaways, having said so then?
6:00 Speaker 00 Well, two, really. I would say the first is just a general sense that this isn't a particularly partisan issue. I would say one could probably detect slight differences in approaches when it comes to regulation versus innovation, as you consult with members on either side of the aisle. But as it related to this topic, I think, and this gets into the second issue... There was a general embrace by my colleagues after they heard from some of the world's best minds that we needed to regulate, but it would have to be a light-touch approach. We had to be very careful not to go overboard and constrain what is, right now, sort of leading-edge industry and the United States is in the lead. We want to keep it that way.
6:40 Martin Casado? Yeah. Do you think we can expect some legislation framework come out of this? Is there a timeframe, or is this still kind of too early?
6:47 Speaker 00 Well, I think we can. My hope is that we can expect all kinds of legislative efforts, not just this year, but in coming years. I don't think we have to rush to do everything at once. We need to get clarity on a lot more of people's concerns. But more importantly, what they perceive to be their opportunities is as the technology evolves, as we learn more about the technology, as new versions are released. So, sort of a wait-and-see approach. I do, however, think that there will be some things we agree on now. We agree that there needs to be some resident expertise within the White House on an ongoing basis that other departments of government look to when it comes to issues surrounding artificial intelligence. I think we need to revamp our human resources approach
7:32 Speaker 00 so that we embed more expertise in every agency of government. We can dialogue with businesses, consumers, and others about things within a department's field that touch on artificial intelligence. And then there'll be some things, as you heard about earlier today, that deal with national security where we're already behind.
7:50 Martin Casado? Yeah.
7:51 Speaker 00 We need to make some key investments in people and platforms. And so, all of those things are among the things that I think in coming months will be addressed through the committees of jurisdiction in a bipartisan way, if politics doesn't get in the way. And as it relates to most of this, I don't think it will.
8:07 Martin Casado? This is a bit of a personal story. So, like, I did my undergrad in Flagstaff, Arizona, like, small Arizona town. And at the university, which is not a notable university, there was a lot of investment from DOD in supercomputing. And they bought supercomputers, and I worked on them as a researcher. And that led me to a job in Lawrence Livermore National Labs. And then at Lawrence Livermore National Labs, I worked in the weapons program. I worked on these, like, huge supercomputers with a bunch of other people that came from similar paths. And I remember thinking at the time, isn't it amazing that we live in this country where people understand those new technologies that are like very powerful and they invest all the way down to Flagstaff, Arizona.
8:40 Speaker 00 Yes.
8:40 Martin Casado? To stay ahead and find the people that are very interested in doing that. And it feels to me, having gone through that and then having gone through also the intelligence community, which also embraced like the internet and like a lot of the network technologies, it feels to me like we're in a bit of a doctrine shift now that when new technologies come, like we kind of are more afraid of them than wanting to get ahead of them. And so like, I just wanted to ask you, is my perception correct that there has been a bit of a doctrine shift in the United States where we kind of worry about the implications of technologies before we're able to actually harness them and become leaders in them? Or is that maybe just like a perspective from the outside?
9:17 Speaker 00 I think it may be fair. I think this is one of the reasons these AI insight forums were helpful to sort of keep certain colleagues honest that might have been ready to move forward aggressively and with various regulatory actions. I can't promise that won't happen in certain discrete areas, but I think there's a tendency to catastrophize different technology areas as opposed to different potential outcomes. Historically, one of the many reasons that we've been a dynamic country and created a favorable regulatory atmosphere for our technology developing businesses is we have laws that reflect our values. We apply those laws to technologies only if they run afoul of certain prohibited behaviors that normally don't even mention the technology, right?
10:02 Speaker 00 And if we can take, at least for the most part, a tech agnostic approach as it relates to AI development and adoption, I think that that would be more helpful. So no special carve outs, no special benefits, except when explicitly there's rare instances where there's a compelling argument that we need to.
10:21 Martin Casado? I went to, you know, one of these AI meetings and there was a lot of concern around AI and I listened to the concern and I'm like, wait, that's not AI, that's like all computers. I was like, that's not AI, that's the internet. Someone that's been in these things for a very long time. And so I've gotten this sense that maybe there's a response to the prior battle. Like people felt like we didn't get it right with the internet and therefore they're trying to like. Use that consternation now but for a different technology.
10:48 Speaker 00 Well, I think that's absolutely happening. It's happening with respect to data right now.
10:52 Martin Casado? Well, let me tell you what the dangerous. So having been through the rise of the internet very closely, there were things that were very unique to the internet, right? Things like asymmetric attack, right? The more that you invested in the internet, the more vulnerable you were. And if you're dealing with a terrorist threat, that's a big deal because they didn't have infrastructure to take down. We did. So that was a very particular thing that impacted defense. There's other things like exponential growth. Things can get out of control and it's everywhere. There was these huge implications. I will say they actually don't exist with AI, but somehow people are imbuing AI with it. And so I'm just wondering if there's maybe like a lack of like literacy or maybe people feel like they've kind of didn't really do it on the previous one. This is being applied now. And if that's the case, what can we do to educate or kind of get ahead of it?
11:33 Speaker 00 Well, this is helpful. You're in the right town, right? But to the extent some of you have not been visiting with members of the Senate, members of the House, who will soon be playing with live rounds, as we said in the Marine Corps, right? Will be considering actual bills. We'll be developing bills and we'll be voting on them. And there will still be some members who haven't done extensive homework and carry superficial views of what constitutes artificial intelligence technology. And we need all of you to disabuse them of this being an extension of social media. This is very different. And data, we're going to have to think about data perhaps in a different way. So I do think that some are either confused. There are others who are just probably using the opportunity
12:16 Speaker 00 of this legislative effort, which is ahead of us, to try and pass bills that they had prepared two decades ago.
12:23 Martin Casado? Yeah, exactly. Right? Sounds like now's my time.
12:25 Speaker 00 I've done it in other contexts, but if we do it in this context, it could be quite damaging.
12:30 Martin Casado? And how much has the economic reality hit the calculus when it comes to these discussions? Because none of us really know the future. I will tell you, when economics change this much, right? When the marginal cost of creation goes to zero, this is going to be another 10x expansion in value for sure. And historically, the US captured that, right? That's like why the internet age was so great for us, right? And so is that part of the calculus? Or is the focus really on how do we keep this stuff from hurting us?
12:54 Speaker 00 We tried to make this part of the calculus. In fact, we spent at least half of the time, perhaps we should have spent even more, on the AI insight forums discussing the upsides. It's not as though we had to address the upsides. The upsides are going to be a result of innovators and entrepreneurs and investors. We understand that. But I thought it was very important for us to focus on that, to provide some balance to the staff members and my colleagues who were present. So constantly reminding people of that, I think, is going to be very important. There are, I think, what you may have characterized in the past as fantastical, some fantastical doomsday scenarios, and there are a lot of those. And there may even be a couple that are real, and we need to hedge against, right? And we need to take those seriously.
13:39 Speaker 00 But we cannot become so fixated on those that we lose the forest from the trees. And we can do this. It'll be complicated, it'll be challenging. We won't get it all right in the beginning. And we shouldn't try and tackle everything in the beginning, which is a bit of a concern. But I think we'll get it.
13:53 Martin Casado? It'd be great for you to talk about, on the positive side, your takeaways from the discussions on how AI can benefit America that's not just strictly economic, from innovation or a tech or a daily life.
14:07 Speaker 00 It's very difficult for us to quantify some of these things. I could sound very specific and learned by just throwing out figures. Within X years, we'll solve cancer. But no, we're going to rapidly compress the treatment and drug development timeline, something I've heard from our pharmaceutical makers. We will come up with drought-resistant, climate-change-resistant crops. They'll feed the world, become more productive, drive down the cost of food. We'll develop the ability to have tailored, personalized tutor services and mental health services, vastly expanding the workforce in those areas, leveraging technology so that we'll have mental health providers in areas. That we don't. We can clean up the environment in all sorts of creative ways.
14:51 Speaker 00 Ways that our artificial intelligence technologies will illuminate some of the solutions to hard challenges. We'll have ways of reading health records so that we can discern probabilities of getting certain types of infections, certain prophylactic measures we can take to extend, improve, and save people's lives. We don't have the benefit of those AI sort of insights. We can decrease the rate at which mistakes are made within a medical healthcare context. So, I mean, it goes on and on. And this is what we should be talking about. I'm sitting on a commission right now pertaining to synthetic biology.
15:31 Speaker 00 And so much of advanced biology these days really involves the use of artificial intelligence or technologies. And so I have charged the commission with educating me and members on specific things, innovations from material science to medicine to environmental health that I can start touting because that's going to be very powerful for my constituents and also for colleagues.
15:54 Martin Casado? As an outsider, it feels to me like the general discourse is getting more sane. And so I've actually gotten a lot of faith in the process.
16:01 Speaker 00 Well, I tend to make people feel that way.
16:04 Martin Casado? With you, but I mean in general. I just meant the national discourse. But the national discourse, it does feel like...
16:09 Speaker 00 I saw you meant in this conversation.
16:11 Martin Casado? Also this one too. Yeah, yeah, yeah, yeah. But I know, I think like people are becoming much more reasonable about it and so forth. And I just feel like you're one of the people that's really been advocating for AI research. I think it's the right thing to do. Thank you very much for doing that. Is your job getting easier in my right? Or has it shifted noticeably since it started, say, two years ago?
16:29 Speaker 00 I would say we were able to foresee the need for more research dollars as it relates to artificial intelligence. Myself, Senator Schumer, who helped get signed into law the CHIPS and Science Act. We made a massive allocation for additional federal research through places like the National Science Foundation and Department of Energy. It wasn't easy to get that included with the CHIPS piece, but arguably that will even be more consequential towards our economic security and our national security in the longer run than will the CHIPS piece. So that authorization will allow us to now appropriate money, if members of Congress can be persuaded, for AI. And so I feel like half of that hard work is done.
17:11 Speaker 00 And we've got a lot more work to do, but I think the job's getting easier because we passed the CHIPS Act. And it's not just the authorization of research, but we've already made the argument, very recently, that something that falls outside of the direct DoD context, as most of the CHIPS and Science Act does, is indeed a national security investment. So we've got the institutional muscle memory used to that notion. That is a historical and modern history. My colleagues typically don't think of an investment in the National Science Foundation as a national security investment, but it is. And then, we also were able to make the case to my colleagues that by making these sorts of critical investments in research and in next-generation technologies, as we did through
17:55 Speaker 00 the CHIPS and Science Act, it's going to lead to a lot of economic growth. And we were able to personalize that argument state by state. So that's the very same argument that we have for this situation: artificial intelligence.
18:06 Martin Casado? So this is going to be repeating a little bit, and I apologize. I just think this is so important. So many of the DC insiders here understand the CHIPS Act and why it's important. A lot of people here that come from the Investment Committee or founders or whatever probably don't understand the implication. My view, it is literally one of the most significant pieces of legislation in 50 years on innovation. It's a huge, huge, huge benefit. It was the right thing to do. And so, if you could just take just a couple minutes to describe at the highest level for those that are not insiders what it is, I think it's so important to get this message out.
18:34 Speaker 00 So the CHIPS and Science Act was, at once, it was a $53 billion investment in both research and incentives for the semiconductor industry. The incentives would be to reshore some of our manufacturing capacity so that our supply chains would not be as vulnerable to interruption as they, of course, were during the global pandemic. And they could be, God forbid, there was a geopolitical effort to interrupt those supply chains, say, by the Chinese Communist Party, making aggressive actions towards Taiwan. It was also a national security effort because, of course, we need microprocessors and we
19:13 Speaker 00 need our own radiation-hardened, domestically manufactured microprocessors to go into nuclear weapons, to go into our radar systems, and all manner of other things. So that was the microprocessor piece. And we have been in the process now where some of that money is starting to flow, over $200 billion of private capital has been invested. And we're not even at $1 billion, even close to it, of federal monies that has been released. So it's paying handsome dividends. The market is responding and we're becoming less risky in our supply chains. The idea was not to become independent of other countries. And then there's this whole other end science piece, which for the purposes of this conversation,
19:55 Speaker 00 big investments in research, which I mentioned earlier. Not just in artificial intelligence, but that research can also flow to hypersonics, quantum computing, synthetic biology, autonomous systems, and other areas, far upstream, of course, but a bit more applied research than the curiosity-driven research that most people tend to associate with the NSF.
20:19 Martin Casado? Yeah, that's great.
20:20 Speaker 00 Yeah.
20:21 Martin Casado? So a number of investors are kind of like these kind of free markets solve everything and like kind of almost libertarian event. I am not that. I worked at Livermore, I worked for DOE, I've done two more efforts. I'm a huge believer in the government, I'm a huge believer in actually national institutions and involvement. That said, there's been an ongoing dialogue with what is the right roles between kind of private and public partnerships for things like AI? What is the right balance? So I'd love your view on how we can work together on this.
20:47 Speaker 00 Yes.
20:48 Martin Casado? Where the government stops, you know, where the free markets pick up. Like, how do you think about that as we go forward?
20:53 Speaker 00 Well, I look to history. I look at what we did in the space race. I look at the innovations that have occurred through our DOE labs, like the one you worked at, like the one that developed fracking technology before the frackers claimed it their own, right? So many innovations have been earned off of the toil of our researchers in our DOE labs through our land-grant colleges and the other constellation of research agencies. So we need to keep making those investments. Over the years, the federal government started to pull back from research that wasn't curiosity-driven, wasn't... Basic research, theoretical sort of research as opposed to more applied. We need some more applied research. I think that's one of the lessons we've learned in recent history.
21:38 Speaker 00 Beyond that, we need clear rules of the road, clear regulations. Those regulations ought to typically be, and I use my words very carefully here because there are exceptions to everything, but they typically should be technology agnostic so that we don't favor or constrain different types of technologies within the market. That's investors, that's business people, that's consumers. And then we're going to have to work with our partners and allies on development of standards for some of these, what I'll call, platform technologies. There aren't many. Artificial intelligence and synthetic biology are the ones that really come to mind. So there's a diplomatic component that if we want our values embedded in this and follow-on
22:20 Speaker 00 generation AI technologies, we better develop and design those technologies here, but we also need to embed the standards that we have as it relates to privacy, consumer protection, and other things into those technologies rather than leaving it to, I'll pick on the Chinese Communist Party again.
22:39 Martin Casado? Yep, perfect. Okay, so we have the last minute. So I only thought it was fair because when I was at the Insight Forum, you asked me this question. So I'm going to ask you two questions that you asked me. The first one...
22:48 Speaker 00 It may be a hard question.
22:49 Martin Casado? It's not. What would you give the chances of P doom?
22:53 Speaker 00 The probability of P doom?
22:55 Martin Casado? The probability of P doom.
22:58 Speaker 00 This is colored by my optimism, right? But low. You didn't ask me to make it quantitative, qualitative. Yeah, low but not nonexistent. Which is how most of the doomsday scenarios are. They're low probability, high cost, and we need to hedge against them. But let me say this, the first step in hedging against them is to really seek to understand them, to study them a lot better so that before you take more costly action, constraining the opportunity cost for humanity ahead, we really know what we're talking about.
23:32 Martin Casado? I love it. One last very quick question with my flair. Do you think that P-doom, or P-doom is a probability that we as humanity has a catastrophic event? Do you think it's greater with or without AI?
23:43 Speaker 00 I think in the short run, you'll see I'm not pandering here.
23:45 Martin Casado? No, I love it. This is great.
23:46 Speaker 00 Here's what we're probably gonna have. We're gonna have in the short run, some unsteadiness.
23:51 Martin Casado? Yeah.
23:51 Speaker 00 Right?
23:51 Martin Casado? Yeah.
23:52 Speaker 00 Because we're trying to learn countermeasures. We're trying to figure out how systems work. We're trying to figure all sorts of things. And then, in the long run, I think we can actually push the risk down.
24:03 Martin Casado? Awesome. Thank you so much. You are wonderful. Thank you so much, everybody.
24:12 Steph Smith? Now, if you have made it this far, don't forget that you can get an inside look into A16Z's American Dynamism Summit at a16z.com/ADSummit. There, you can catch several of the exclusive stage talks, featuring policymakers like Deputy Secretary of Defense Kathleen Hicks, or Governor Westmore of Maryland. Plus, both founders from companies like Anduril and Coinbase, and funders like Mark Cuban. All building toward American dynamism. Again, you can find all of the above at a16z.com/ADSummit. And we'll include a link in the show notes.
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