The state of the U.S. economy will come into full view this week as a wave of crucial economic data is set for release, including the jobs report, inflation, consumer confidence and corporate earnings. Where is the U.S. in terms of the global economic order? And how did we get to this point? Aya Ibrahim served as senior advisor on the Secretary of State’s Policy Planning Staff in the Biden-Harris administration, led President Biden’s Blueprint for an AI Bill of Rights and Digital Assets Executive Order. She is also a former senior policy advisor at the National Economic Council. Ibrahim joins WITHpod to talk about her view on what Democrats need to do now, the United States’ standing in terms of technology, finance and more.
Note: This is a rough transcript. Please excuse any typos.
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Aya Ibrahim: We have this larger problem where we have companies that are so big, right, that they tell the government what to do, as opposed to the other way around, right? What the OpenAIs all are doing, it’s not a new playbook, right? We saw the Google and Facebook 10, 15 years ago, basically say the same thing. Like, we’re American champions. You have to let us do all these things. We have to win the race with China, on and on and on. If it’s not us, it’s them. And like, this is the thing that will transform, insert, whatever.
And now, we’re seeing it with AI. And my concern is that if it is as dangerous as a nuclear weapon or any weapon, why are we rushing to sell it to whoever is willing to buy?
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Chris Hayes: Hello and welcome to “Why Is This Happening?” with me, your host, Chris Hayes.
You know, a lot has changed in the global economic order since the end of World War II. Obviously, a lot has changed. We’ve been through sort of different phases, from the rise of the manufacturing industrial boom of U.S. and allies and Japan afterwards to the sort of competition to the Cold War, to the post-Cold War age of like peak globalization and neoliberalism, to the sort of rise of China.
But throughout that, there’s been like some real constants. The biggest of which is the U.S. is at the center of the entire global economic order, based both on the sheer economic power of our production and output, and the set of interlocking institutions and policies by success of administrations that sought to sort of create a global economic order with the U.S. as the linchpin and often I think the beneficiary.
Trump clearly views that order as predatory towards the U.S. I think it’s a huge mistake. I think we get a lot more out of it than we give it to them. But he views this all sort of predatory. He wants to get rid of the order such as it is. He wants kind of more like U.S. go alone/brow beat and bully other people into doing what we tell them. And all of this is happening at this time when China is ascending to a level of global economic power, and also innovation at the most cutting-edge of technology, such that the distance between the two economies’ abilities to, you know, own the future is very much in doubt.
And at the center of that entire competition and story is the big technology of the future, at least, according to how I think both certain sectors of industry and governments think about AI in both the U.S. and China, which I think, in some ways, is the prism through which whatever succeeds the current global economic order is going to get filtered.
And so, to sort of talk about like where we are as this, I think, epoch kind of comes to a close maybe, or we transition to something new in this new frontier, I wanted to talk to Aya Ibrahim who’s got a perfect resume for this. So, she served as a senior advisor on the Secretary of State’s Planning Staff in the Biden-Harris administration. She also led President Biden’s Blueprint for AI Bill of Rights and Digital Assets Executive Order. So, she worked on that. She also served as a senior policy advisor at the National Economic Council.
Aya Ibrahim, welcome to the program.
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Aya Ibrahim: Thanks, Chris. Thanks for having me.
Chris Hayes: I guess let’s start at the sort of broad strokes thing of like, as someone who worked in the kind of deep parts of the government that deal with the global economic order, do you think, first, that the U.S. has been a beneficiary of it and that the institutions we constructed, supported and have nurtured have redounded to the benefit of Americans?
Aya Ibrahim: I mean, absolutely, right? You said after World War II, we set up this global financial order. We put ourselves at the center and at the top, and we have benefited for decades, right? So, whether it’s the fact that the dollars the global reserve currency, or the fact that U.S. treasuries are seen as a risk-free asset, even though they technically are a security, or the fact that we are the premier destination for foreign direct investment, like, this is the place people want to do business. This is the place people feel safe putting their money. And the dollar is the currency they feel safest doing business in.
We have, you know, our comparative advantages, which have shifted a bit over the last couple decades. But at the end of the day, it really comes back to we have the most liquid and dynamic and competitive capital markets. We have the most cutting-edge technology, and we have the world’s best higher education system. And all three of those things are essential for what I imagine we’re going to end up talking about, this global race to dominate in AI.
Chris Hayes: I want to stay with this just for a second because I think part of the issue is that a lot of Americans feel, and I think with some justification that, like, they’re not cut in on this deal, right? That all the things you said, which I think are true, and again, I’m kind of a left labor-liberal, social Democrat about all this, but I recognize the value of these international institutions.
But in the American story, and particularly both distributionally and geographically, it’s like, okay, maybe that’ll be true, but do the liquid capital markets help me? Does a great higher education that tons of Chinese students come to use help me? Like, what’s in it for me, and has it helped me? What’s the response to that, do you think?
Aya Ibrahim: Well, I would just take a step back, because I don’t think the issue is the capital markets discreetly, or the technology, or the higher education. Our problem in the United States is historic inequality, right?
Chris Hayes: Right.
Aya Ibrahim: It’s the distribution of these things and the difference in access. Look, to be totally honest, I don’t think that any American is going to bed being worried about who has the most compute, who has the highest number of GPUs, U.S. or China. That’s not what people are worried about. They’re worried about housing, healthcare, education, job opportunities. So, to the extent that AI is either an enabler or an obstacle to those things, that is what I think they will end up worrying about. And that’s what’s most important.
Chris Hayes: Right. Totally. And I think to your point about distribution, I think these things end up tied together, and I think both at the level of elite critique, and also how people experience it, which is like this globalization didn’t pan out for me.
Aya Ibrahim: Yeah.
Chris Hayes: So maybe it’s better if we go alone, even though there’s other ways that we could construct the American economy that doesn’t just ditch and destroy these institutions that would be a fair, more equitable society.
Aya Ibrahim: Right. Well, you know, the call is coming from inside the house. You know, it is not China that has set up an unequal economic system here in the U.S. It isn’t China that slashed our social safety net. It isn’t China that is making it prohibitively expensive to go to college or buy a house. I mean, we pursued policies of scarcity and artificial scarcity at that, and that’s on us. We can’t blame anyone else for that.
The other thing that I would say is, to the extent that people feel we have given too much or given a lot, we’ve also received, you know, outsized returns, right? The United States across multilateral institutions holds a veto power. So, whether it’s in the UN Security Council or at the IMF, we have outsized a voice at the World Bank. I mean, it has been to our benefit and we’ve been able to steer international institutions in service of our priorities.
Chris Hayes: Yeah. One of the places where I think the rubber really hits the road on this, which people don’t appreciate, but when you started out in talking about the U.S. Treasury as the risk-free asset, right, throughout the 1990s, the period of what was called structural adjustment, where international creditors basically could squeeze a country and say, no, sorry, you have to cut pensions. You have to raise retirement age, cut your social safety net, all this stuff, because your budget needs to come in line. And your budget needs to come in line because, basically, you need access to dollars fundamentally, because that’s the world’s reserve currency and you don’t have enough of them.
And a tremendous amount of damage and misery was imposed on people. After the financial crisis, in the eurozone where the same thing happened to countries like Greece, they could not control their own balance sheets. Like, we never have to do that. And us never having to do that, deficits get too big. We have higher yields. There’s some crowding-out problems. But fundamentally, that premium we take for granted, Americans do not appreciate what it means to chart your own destiny in a way that go talk to people from Peru to Columbia, to Athens about what it means to be on the wrong side of that.
Aya Ibrahim: Absolutely. And thank God that we’ve never dealt with a true, you know, fiscal crisis in the way that many of our allies have, but that’s because we structured the entire international financial order around what works for us. And so, you know, I don’t want us to go down a road where, well, we’ll be just like, we’ll leave it up. This part of it isn’t working and I’m not getting what I need at home. And it’s not in either/or, right? So, it does not have to be this binary, either we get what we need at home, or we do what we need to do abroad. That is a failure of policymaking, and it’s also a failure of imagination. It is not an either/or. It doesn’t have to be.
Chris Hayes: There are a few big things, I think, currently threatening this global order. So, let’s start with one big one, which is Trump. U.S. policy is contemptuous at this moment of this order, and I wonder how much you think of this is permanent and how much is temporary? Like, how big a shock to the system is this, both Trump’s attitude towards allies, international institutions and essentially multilateral trade war that he’s launched against all and sundry?
Aya Ibrahim: Yeah. I mean, I think it’s a few things, right? So one, the first time Trump was elected, we said, this is a one-off, right? You know, this isn’t who we are. This is not what we’re about. We’ll fix it.
Chris Hayes: It was a fluke. He lost a popular vote.
Aya Ibrahim: It was a fluke, right? It was an anomaly, right? Second time is an indictment. And at a certain point, yes, allies are not going to want to negotiate with us or come to agreements because, at any point, the next administration could come in and tear it up. So, there’s that predictability or that reliability that is a little bit out the window.
The other major part of this is that this entire system is held together by belief in some level of certainty and stability in the American financial system. So, you know, you look at the dollar and it says full faith and credit of the United States government, because it has never been in question that the U.S. would pay its debts, right?
And then here comes the Trump administration, they’re playing around in the Bureau of Fiscal Services. They’re questioning the validity and the volume of debt that is outstanding. And for the first time, people are wondering, is this, otherwise, certain thing no longer certain? And we’ve started to see people move capital away from treasuries, from U.S. dollars, and they’re parking them in euros, or they’re buying gold, or they’re buying yen. We’ve started to see that shift. Really the long-term consequence of this president is he’s shown that actually one person can upend a system that has held for decades, and that to me is the biggest danger over the long run.
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Chris Hayes: More of our conversation after this quick break.
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Chris Hayes: Let me play, it’s not really the devil’s advocate, but just the sort of other side of this, and I don’t have strong feelings on this. But, you know, there’s a joke about economists predicting like seven out of the last three recessions, right? They’re always predicting a recession. And in a similar line, the end of the dollar as the global reserve currency is one of these tropes of, like, this is it. This is it. You know, people are constantly predicting that this system is going to run out of gas. And at some level, you know, you look at Rome, looks like it took them like 600 years to unravel.
Aya Ibrahim: France has had like six republics.
Chris Hayes: Yes, exactly.
Aya Ibrahim: You know, it doesn’t have to happen at once. Yeah.
Chris Hayes: The system is so big and so powerful and has interlocked so many different interests in so many different ways, that it can take a lot of abuse and break in a lot of ways, and kind of keep chugging along. In some ways, I’m surprised there hasn’t been more of freak-out, right? Like, we’ve seen a few moments when yields and spreads have gone crazy, or when people have moved against the dollar. But by and large, it’s kind of been less in some ways than you would think, given how radically Trump has acted. And I wonder how powerful you just think that, like, there is no other alternative at the moment, this is the system we have, as a kind of binding inertial force.
Aya Ibrahim: Yeah. That’s a very good question. I would question the definition of resiliency that you are applying here. Because, for example, one thing that we said throughout the Biden administration was that the United States had the best economic recovery of any of the G7 countries. Yes, we did, relative to these other countries, but where were people before the pandemic, and was it a good place? And I think that is the disconnect, right?
In the aggregate the United States bounced back because in the aggregate, the United States and its financial system and its economy is they’re tremendously large and they are resilient in many ways. But individual households, they were breaking, and that is why we saw so much frustration, I believe. People could not afford the things that they needed. They couldn’t afford housing or healthcare on and on.
Those two things are so in tension that it does start to crack a bit. Politically, you get to a point where people are like, we don’t want to engage with the rest of the world. We actually don’t need to be the biggest. We don’t need to be the best.
Chris Hayes: Yeah.
Aya Ibrahim: I just want the things that I need here at home. And if what you’re telling me is in order to sustain this system, we’ve got to keep going the way that we’ve been going, I don’t want it. Give me anything else.
Chris Hayes: I think you’re totally right about that. And I think, you know, that point you just made, to me, the sort of defining feature of the Biden economy, in aggregate macroeconomic terms and comparatively, it was one of the most superbly managed recoveries from crisis that I have ever seen, and that is both the Biden administration and the Congress and Powell. Inflation got very high, and honestly, some of that was probably the ARP spending, but it also —
Aya Ibrahim: Marginal. Chris, marginal.
Chris Hayes: Marginal. Yeah. Look, I don’t think it was the main cause, but there was some marginal addition.
Aya Ibrahim: Sure.
Chris Hayes: But wages at the bottom rose in real terms. There were a million different ways in which it came back faster and better than you could have dreamed in some ways.
Aya Ibrahim: Yeah.
Chris Hayes: And yet, people hated it. They freaking hated it. And we had all these debates about the vibecession, and I think really the way you square the circle is just distribution and affordability, right? Like, the aggregate numbers are really good. The necessities of life cost too much money, and people feel like they’re going behind because there’s a small group of people that have a lot of the wealth.
It’s interesting when you mean now, and I’m so curious, someone who worked in the Biden administration on economic policy, it seems like the vibecession is on shoes on the other foot now because there’s a lot of things they could brag about, macroeconomically. Again, the American macroeconomy has remained pretty remarkably stable, actually, considering all they’ve thrown at it, with the tariff stuff and all this stuff. And yet it’s the same thing, like look at the polling, people are like, this sucks. I don’t like it. He’s 22 points underwater on cost of living in the economy, and it’s kind of wild to watch the same dynamic sort of reinscribe itself.
Aya Ibrahim: Well, because the core contributors to that feeling of a lack of affordability are the same. Nobody has built any housing. It’s everyone’s number one expense. I will say, you know, throughout my entire time, it is the thing that I kept coming back to, which is housing. Housing, shelter costs, as you know, are a third of inflation. They’re a third of CPI. And we didn’t address it in a way that met the scale and scope of the problem during the Biden administration. They still haven’t done it. Now, if anything, the President and his actions are driving up the cost of housing and housing construction, whether it’s high interest rates.
Chris Hayes: Lumber, copper, steel.
Aya Ibrahim: Right. But also, immigration enforcement, right?
Chris Hayes: Right.
Aya Ibrahim: So, you have people who are not going to job sites because they’re afraid. You have financing that remains expensive because the Fed is not cutting rates, and they’re not cutting rates because there’s so much uncertainty because of, yes tariff, no tariff, you know, blue tariff, red tariff, whatever.
I think that until the fundamental needs of the American people are addressed, they’re not going to feel good, right? And we had four years of varying levels of wage gains. So, if you look at real wages, they did decline before going back up.
Chris Hayes: Yeah.
Aya Ibrahim: But four years of anything is not going to make up a 40 years of wage stagnation. It’s completely decoupled from rise in inflation, cost of living, productivity.
Chris Hayes: There’s a real generational thing about inflation, which I’m curious to hear. You know, people my age and younger came of age in what is sort of the great disinflation, right? The whole kind of post Volcker neoliberal regime really did see this remarkable, essentially 40-year run of disinflation. And this thing that had been a perennial problem in American politics and political economy, that had bedeviled administrations, you know, was just not really an issue. And then it hit 9 percent in ‘22, I guess.
I’m just curious on what your experience of that was like inside the administration, and also just generationally, again, people my age and younger have dealt with in the real world.
Aya Ibrahim: We didn’t deal with that, but I feel like we’ve dealt with every other possible crisis known to man, right?
Chris Hayes: Yes. Totally.
Aya Ibrahim: So once in a lifetime public health crisis, once in a lifetime financial crisis, except twice, right?
Chris Hayes: Right. Yeah.
Aya Ibrahim: The two largest since the Great Depression. I imagine that many of the more senior policymakers, like these are things that are shaping how they’re thinking about responses, and people remember. I mean, I love Carter for a number of reasons, but I also understand why he was so unpopular.
Chris Hayes: Yeah.
Aya Ibrahim: Right? People were miserable, economically. But interestingly enough, I mean, interest rates were pretty high during Reagan too, right?
Chris Hayes: Yeah.
Aya Ibrahim: If you want to talk about like vibes and vibes driving the economy, they were not great during the Reagan years, but everyone remembers the Reagan years so fondly, right? So that is another disconnect that I don’t totally understand, which is another generational thing.
Chris Hayes: Yeah.
Aya Ibrahim: I mean, I can’t speak to what I didn’t experience myself. But for my entire life, I’ve just watched things cost more than people are able to afford and it’s just getting worse.
Chris Hayes: Yeah. That’s interesting. So, there’s continuity there is what you’re saying, like from a generational experience.
Aya Ibrahim: Yeah.
Chris Hayes: Because to me, there’s partly that. It was interesting to me. Obviously, I’ve studied a lot of economic history and stuff. But the experience of going to get a cup of coffee and being like, wait, what? How much? Like, I’ve never really had that. I’d had it sometimes if you go to a very fancy neighborhood. But the sort of sticker shock, how much power and salience it had, I know. I’ve read my history. I know that’s true. But it was interesting to me to experience it first person viscerally, in a way that I had only read about essentially in textbooks.
Aya Ibrahim: Right. I mean, I remember very clearly my mom, who supports everything that I do, like, you know, go be great, but doesn’t really ask a ton of questions about the actual jobs. But she calls me and she’s like, do you know how much tomato paste costs at the grocery store today? And I was like, no, that’s generally not a thing I track. She said, today, it’s $1.25. I used to buy three for a dollar. And at that point, I was like, we are in trouble, because if my mom is calling to ask what we’re doing about —
Chris Hayes: Her daughter in the White House, she’d be like, what are you doing?
Aya Ibrahim: What are you doing about tomato paste, specifically? You know, it is incredibly salient because if I can’t put a roof over my head, if I cannot feed my children, literally nothing else matters. Nothing else matters.
Chris Hayes: Can I play an unfair game of counterfactual history with you here?
Aya Ibrahim: I mean, is it history before I was born?
Chris Hayes: No. I mean the Biden administration.
Aya Ibrahim: Sure.
Chris Hayes: You know, one of the things that’s so maddening, one of the reasons that I think inflation bedevils so many, you know, elected administrations, and this is a comparative problem across the world is because it is hard. It is often not in the control of particularly the fiscal authority, right?
Aya Ibrahim: Right.
Chris Hayes: You know, monetary policy can bring inflation down, but often at some real painful cost. I do wonder sometimes if there’s a universe in which the Biden administration basically declares war on high prices, in a bunch of ways that maybe are like economically counterproductive. Like, under emergency authority and this statute; you know, COVID supply crunch; we’re imposing wage caps and price caps, or we try some sort of price cap regime, and let the Supreme Court strike it down, or let the Republicans rail against it.
But I just wonder if there’s a universe outside the box thinking of we’re going to just try some stuff that they haven’t been doing since the 1960s and ‘70s, and maybe it gets struck down the court and maybe people drag us for it, but it sure looks like we’re trying our best to bring high prices down.
Aya Ibrahim: There were definitely calls for us to be more creative. I always lean to team creativity. Let’s try, and then if it doesn’t work, it doesn’t work. But there is inherently always a risk aversion, and I think that that is not specific to the Biden administration or the Biden White House. It’s just the nature of the beast. It’s interesting that, you know, the last time we had price controls I think was Nixon, right?
Chris Hayes: Yeah.
Aya Ibrahim: So, Republicans have been more forward-leaning in some ways. When we did the CARES Act during the Trump administration, we had a foreclosure moratorium. We had an eviction moratorium. I don’t know that that necessarily would’ve been included if it was just Democrats —
Chris Hayes: Interesting.
Aya Ibrahim: — who were pushing this forward. Because of all of the unfair characterizations of Democrats as being anti-business, you know, anti this or that, there is a lot of hesitation. But if we’ve learned anything from the Trump administration, it’s like decide what is important to you and the outcomes you’re driving towards and go.
Chris Hayes: That’s such a good point. I mean, one place where that’s so clear right now, the President has unilaterally hiked taxes by trillions of dollars. Like, that’s not an untrue statement.
Aya Ibrahim: Oh, the tariff policy.
Chris Hayes: Yeah.
Aya Ibrahim: Yeah.
Chris Hayes: He has unilaterally hiked taxes by himself. Again, if you scored it in a 10-year CBO window, $2 trillion to $3 trillion, it’s looking like wherever we end up with the level, it’s going to be in around the $200 billion a year. A Democratic president that was just like, I’m raising everyone taxes by my magic wand here at the White House by $200 billion. People would lose their minds.
Aya Ibrahim: Yeah.
Chris Hayes: And I do think in some ways, that point you made about the way the different coalitions are coded, gives him more latitude to do this.
Aya Ibrahim: Yeah. You know, I think that that’s exactly right. I know there were a lot of feelings about how the Biden economy was covered and whether, you know, the media was being fair or not fair. I think at the end of the day, people want to see you do something.
Chris Hayes: Yeah.
Aya Ibrahim: Like visibly, they want to watch you exercise power. I voted for you. I gave you a mandate, go do something. I don’t know that what he’s doing is what people were hoping or asking for. I doubt it for many. I do think that many people voted not whatever we’ve been doing, the other thing, right? It didn’t matter what the other thing was.
Chris Hayes: Yeah, the other thing.
Aya Ibrahim: Yeah. In this instance, it was Trump. But, you know, we also had tariffs during the Biden administration, right? But there were entire interagency processes to decide what makes the most sense, and we made them narrow and we made them targeted, and we had all these justifications. Whereas here, he just said, these other countries are ripping us off. I get it, maybe I’ll do it if I was them too. But, you know, they’re ripping us off and it stops today, and here’s a blanket policy.
Some of it is he and his advisors maybe not feeling like they have to answer to the American people, which is a whole other can of worms and a huge, huge problem. Democrats overexplain. We overexplain all the time, right?
Chris Hayes: Yeah.
Aya Ibrahim: Instead of just saying, we’re doing this thing because we think it’s the right thing, or here is the outcome we’re driving towards, we become obsessed with process and doing it the right way. I just don’t understand the value of a process that gets you to a bad outcome.
Chris Hayes: I am hearing from you what has been a theme in former Democratic staffers that I’ve been talking to, as they watch Trump, which is envy. Envy at —
Aya Ibrahim: I mean, I’d like to think I’m one of a kind.
Chris Hayes: Well, you’re articulating it better maybe than most. But I do think it’s actually a common feeling, and I’ve talked to different people. I’ve talked to people that worked in the digital sphere. I’ve talked to people who worked in foreign policy. I’ve talked to people who worked in Treasury, where it’s like, oh, man, if we could have just been doing this, screw it.
Like, the amount of times I wanted to do that, the amount of times that I was in interagency process meetings that lasted months. And again, part of this is process exists for a reason and you see that all the time, because actually it does matter.
And second of all, the courts are giving them tons of latitude that a Democratic president wouldn’t get. So, you saw on the student loan stuff, it’s not like the door swings both ways. It doesn’t. But all that said, it does seem to me there’s a process-obsessed, risk aversion culture to Democratic policymaking that is kind of an issue. What do you think?
Aya Ibrahim: Yes. Yeah. And part of the challenge is there’s many of the same folks over and over again. And so, the risk aversion, if this is the thing you want to keep doing, you may not be as inclined to put yourself out there or push for a policy that may not work or may get struck down. And so, we’re negotiating with ourselves before we even get anything out the door.
I mean, it’s frustrating across the board, but it’s frustrating particularly in a moment of crisis, right? So, we did the American Rescue Plan and, I mean, the largest expansion of social safety net in 50 years. We had the childcare stabilization fund in there. We had rental assistance. We had support for homeowners, for small business owners. I mean, it had everything in it, and we showed that government can deliver. And then we turned around and stopped, right?
One example, I worked on the Emergency Rental Assistance Program, like the implementation. And one of the things that was raised was, well, how do we get this information to the right set of people? And so, I remember suggesting, well, because we know if you are on Medicaid and if you are a TANF or SNAP recipient, then you likely already qualify for Emergency Rental Assistance. We could not get that data, right? So, the agency says, we can’t give that to you. Basically, that data is firewalled. So, what we had to do was give them information that they could then pass on to recipients, or pass on to states that administer these programs, that they would then pass on to recipients.
And watching DOGE and the Trump administration —
Chris Hayes: Wow. Yeah.
Aya Ibrahim: — basically destroy all of those firewalls, I mean, it’s, one, super distressing because the reason that they’re doing it is to weaponize the data. So now, they’re taking information from the IRS to be able to hunt down folks who are undocumented, after we told them, hey, you should pay taxes because that will be helpful to you as you navigate, you know, potential pathways to becoming documented, right?
Chris Hayes: And we won’t hold it against you, crucially. Like, pay us the taxes. We want the money, but we’re not going to use this against you.
Aya Ibrahim: Exactly. And to me, I mean, so much of this is really disheartening. It’s frustrating. It’s heartbreaking. But I have a lot of grief around this point, specifically, because there was a window where, again, we showed people that government can show up for you when you need it most. And we said, don’t worry, we’re not going to come after you even if, you know, you got a little bit more than you were supposed to. We are in a crisis. It’s a state of emergency. The most important thing is that we get it to everyone who needs it, as opposed to trying to figure out a way to make sure that on the front end, no one maybe is on the fence in terms of eligibility or whatever. Like, we didn’t let that get in the way of showing up.
And now, I mean, in many communities, people are just not going to trust us again, and I don’t know how to rebuild that trust.
Chris Hayes: Why? Say why was that trust broken.
Aya Ibrahim: Yeah. I think that trust was broken because, you know, in the instance of data sharing, we told people who are undocumented, we’re not going to hold this against you. But the data exists, right? So, to the extent that the government is collecting data anywhere —
Chris Hayes: Oh, I see what you’re saying.
Aya Ibrahim: — and there are communities that inherently are suspicious of the government. But we said, it’s okay. Like, we’re doing this so we can help you. And now, this administration very clearly said, well, we’re going to use this to hurt you.
Chris Hayes: What you’re saying is so important because it precisely captures the problem that presents itself in so many different areas, which is this, you guys want to go access this data for good reasons, that would cut through the bureaucracy and get people the help they need. And there’s bureaucracy and red tape that stops you from doing that. In some cases, it might even be like statutes, or lawyers who read the statute a certain way, that means you can’t get the data.
Then the Trump people come in and they knocked down all those walls to use it for really malicious ends. And in that moment, you’re like, oh, right, that’s why those walls were there.
Aya Ibrahim: Right.
Chris Hayes: But it’s sort of the worst of both worlds. This is what I sort of feel about all this stuff is that somehow this stuff stopped a lot of people from doing good things, but managed not to stop bad people from doing bad things. Like, you wanted it the very least to do both, right?
If there’s some bureaucratic impediment, if there’s a roadblock, if there’s red tape, it can be a real pain, but at least it’s there. The fire code stops people from building buildings that are going to go up in flames. And it can be a real pain in the ass when you’re going through innovation to, like, dot every I and cross every T. But, at least, in like New York City, you actually have some confidence to like, this is pretty serious. This is enforced pretty much across the board, and it actually means, in the aggregate, people are not going to build buildings that fall down or light on fire. But to have it be like you have bureaucratic red tape, and then the second the worst possible person to wield power is in power, they can rush over it, is a really difficult thing to swallow.
Aya Ibrahim: Yeah, it sucks. I mean, some of it is the self-policing that we do, right? Because out of respect for norms and we want to be the adults in the room and on and on, some of it is that the courts will treat what we do differently than —
Chris Hayes: That’s a huge part.
Aya Ibrahim: — it would a different administration. That’s a huge part of it.
Chris Hayes: And again, to be clear on that, just one second, like —
Aya Ibrahim: Yeah.
Chris Hayes: — dozens of district court judges have been like, you can’t do this, particularly with data. The only reason that they’ve sort of been able to wriggle out a lot of this is Supreme Court is like, you can do whatever you want. But, I mean, they have been stopped by the lower courts across the board on a million things they’re trying to do.
Aya Ibrahim: Right. But has it actually stopped them?
Chris Hayes: Right. Yeah.
Aya Ibrahim: And it may have stopped some action, but the overall trajectory, the momentum is still forward. And one of the things that we’re not hearing about, so the terrible things that are coming up in court cases are being reported on. I mean, it’s very likely just the tip of the iceberg because the government is very large, right? And it is thousands of people making a series of decisions every day, that sometimes ladder up to one big decision, but sometimes just remain dozens of decisions made every day.
There is no oversight of that decision-making at that level. And I’m not saying they necessarily should be policing everyone working in the government —
Chris Hayes: Right.
Aya Ibrahim: — at every level. But I’ll also say there’s a lot of damage and hollowing out of capacity and administrative ability that’s happening every day that we are not privy to, and we won’t know until a change in administration.
The flip side of what you’re saying is that if we build something, right, if you build an ICE, or you build up an ICE, you build a deportation machine, you build the CBP One app, whatever it might be, anything that you build, the next administration can wield in whatever way they want. So, it feels that you almost can’t do policy with the assumption that you will have responsible actors —
Chris Hayes: Yeah.
Aya Ibrahim: — regardless of administration. I mean, to the extent that was a norm or an expectation, I feel that has been shattered. And if it hasn’t yet, then I don’t really know who will.
Chris Hayes: I mean, the biggest threat right now, or the biggest kind of variable in, you know, possibly altering or destroying the existing global economic order here in the U.S. is U.S. policymaking under Donald Trump and what it’s doing in the short term, what it’s doing in the long term, what it even pretends for like the possibility of trust in the full faith and credit, or us as reliable partners and all that stuff. So that’s one huge part of it.
The other predates Trump, which is just the rise of China as, you know, possible alternate global hegemon, largest economy in the world. And again, that’s one of those things that has been predicted hundreds of times in my life. And before it was China, it was Japan. Back in the 1980s, you can go rent the “Rising Sun” movie based on the Michael Crichton book which —
Aya Ibrahim: Gen Xers want everyone to know all of their cultural references. It’s crazy.
Chris Hayes: Every generation wants that, to be fair, but, yes, we do.
Aya Ibrahim: No. There’s something very specific about Gen X.
Chris Hayes: You’re getting back this amazing period —
Aya Ibrahim: Nobody understands us. Nobody gets us.
Chris Hayes: That’s probably true, actually.
Aya Ibrahim: See what I mean?
Chris Hayes: It’s a weird movie. But point being that, like, there was a huge period of time where it’s like the Japanese are going to supplant America. And they’re making all these cars, and they bought Rockefeller Center. And then it was like, no, that was completely wrong prediction.
And then there’s some people who think the China hype is the same thing. And then there’s others who are like, no, this is going to be China century. And I’m curious where you come down on that, and how much of that was a conversation inside policymaking in the Biden administration from NEC and State and stuff like that.
Aya Ibrahim: Yeah. It’s difficult to predict with any certainty, one way or the other. I mean, the American economy and the United States as a country, it is so unique, right? The natural resources that we have, we have 330 million people, remains the number one destination for the world’s talents, the hardest workers, the best and brightest.
It is hard to imagine it being fully displaced. And even though, you know, we’re not this manufacturing superpower in the way we might have been decades ago, the pivot into services, well, we dominate that. We dominate software. We dominate technology. And so, there’s just been like a rejiggering of the composition of our economic strength. And that’s all well and good, right? Like, the kids don’t yearn for the mines. I don’t want to go work in a factory, and we have transitioned to doing what we’re best at doing.
China, similarly, has found the things that they’re very good at doing and doing at scale, right? I think the question is not China or the U.S. completely, either one or the other. I think it’s across a number of sectors, a number of issues, right? One may dominate in solar panels, for example. The exercise to me seems one where we need to figure out, okay, what are the arenas, or the technologies, or the services that we want to remain dominant in, right? What are the things that the United States needs to remain number one in? And what are some things where, you know, maybe that’s not the fight that we need to fight, and I think solar panels is a good example of that.
If we cannot produce solar panels at the same price point that they can, but at least the Biden administration and those who believe in climate change, have these climate goals, the Net Zero 2050. We’re going to need a lot of people to have a lot of solar panels, and we’re not going to be the ones making them. So, is that the fight that we want to fight? That is how I think about it.
Chris Hayes: Yeah.
Aya Ibrahim: And I would also just note, you know, a lot of things did hold steady from the first Trump administration to the Biden administration, right? A lot of the posture around China and, you know, the strategic competition, and it’s like the great power competition, if you will. So that thinking didn’t totally change. I don’t know what direction he’s going to take in now. Maybe they do a deal, maybe they don’t.
Chris Hayes: Yeah.
Aya Ibrahim: I don’t even know that it is worth trying to predict.
Chris Hayes: No. I mean, I think that’s impossible. But, I mean, the point about, you know, there is a tendency, I think, in the journalism on this, sort of reduce it to like the Olympics, and like we’re going to win more medals, or they’re going to win more medals.
Aya Ibrahim: Yeah, like absolutes. Yeah.
Chris Hayes: Yeah. That’s not the way things work, and also not the way that necessarily global trade works. Like, to your point about solar panels, it’s like one country’s income is in another country’s price, and vice versa. They can make things cheaper, which means maybe we don’t have solar manufacturing as our thing, but also means maybe we have a lot cheaper solar. You know, how does that net out?
It does seem to me, though, that the place where this does come to a head is on AI, right? Now, I was talking to someone, a very smart person who’s working on some stuff on AI, who said, and he’s not the only person to say this, but it struck me, he’s like, imagine the nuclear arms race, but it was just a bunch of private companies —
Aya Ibrahim: Yeah.
Chris Hayes: — and how insane that would be. Everyone is just like, well, we’re trying to build our bomb. We’re trying to build our bomb. And there’s a few startups over in these other countries that are trying to build their bomb and I was like —
Aya Ibrahim: Can I sell you some enriched uranium? You’re interested?
Chris Hayes: Yes. Exactly.
Aya Ibrahim: Yeah.
Chris Hayes: And that metaphor really stuck with me when you think about the power of what’s happening here. And I’m curious, you were on this AI task force, I guess, or council, I don’t know, one of those sort of efficient government bodies. How are you guys in the Biden administration thinking about AI in terms of strategic competition, in terms of safety, and in terms of regulation?
Aya Ibrahim: So, I’d say, as it’s true in any administration, there’s like many schools of thought. So, I worked on the Blueprint for an AI Bill of Rights and it centered on five things that should hold true, regardless of the AI or automated system. The system should be safe and effective. There should be data privacy. You share protections against algorithm bias and discrimination. You should know when an AI system is being used in making a decision for you, and there should always be a human fallback. And that was a perspective on AI and automated systems that centered people, and the ways in which technology interacts with people.
Obviously, there are geopolitical considerations, national security ones. There’s like an economic competition piece to it too. But the first thing out of the gate from the Biden administration on this was a document that said here is how we protect people, and here is how government can think about protecting people, which I think is an apt way of looking at it, that comparison to the nuclear arms race.
I don’t think that it is specific to AI, right? We have this larger problem where we have companies that are so big, right, that they tell government what to do as opposed to the other way around, right? What the OpenAIs all are doing, it’s not a new playbook, right? We saw the Googles and Facebook 10, 15 years ago basically say the same thing. Like, we’re American champions. You have to let us do all these things. We have to win the race with China, on and on and on. If it’s not us, it’s them. And like, this is the thing that will transform, insert, whatever.
And now, we’re seeing it with AI. And my concern is that if it is as dangerous as a nuclear weapon or any weapon, why are we rushing to sell it to whoever is willing to buy? That, to me, feels inconsistent.
Chris Hayes: Do you think it’s that dangerous? Do you think it’s a fair metaphor?
Aya Ibrahim: I think you can do a lot of both good and a lot of bad with models that are much simpler and much smaller, right? And those will become increasingly available to people. We’re not regulating at that scale because we’re so taken by the largest models and the largest players, and the most cutting-edge chips.
You know, we’re seeing what people can do with commercial drones. Like, it doesn’t actually take —
Chris Hayes: Yeah.
Aya Ibrahim: — the most sophisticated version of a technology for you to do harm, if your goal is to do harm. I think, given the fact that the United States and China are, I mean, the United States continues to lead and has a leading edge. If we’re going to use the nuclear weapon model or example analogue, the USSR and the United States came together at the point when they were both the biggest powers in this space and said, okay, here are going to be the rules of the world for everybody else.
Chris Hayes: Yes, exactly.
Aya Ibrahim: So, if there was a moment to do it, it would be right now. But if you do that, then there’s a lot less money to be made, because then it is controlled and regulated in a way that those who have the most to gain from its proliferation don’t want to see.
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Chris Hayes: We’ll be right back after we take this quick break.
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Chris Hayes: One of the things, I think, that’s so key to understanding that, now, I think instantly iconic image of all the tech CEOs at Trump’s inauguration is that this is what it’s all about. And they have their guy, David Sacks, in there. And the President just unveiled yesterday their AI vision, and you know, I’ve read parts of it in summaries. I mean, you know, the sort of America First Plus, we’re not going to really regulate you guys, it’s basically the kind of major takeaway.
And, you know, they think this is it for them. This is the next jackpot, and it’s the next iteration of tech, and that it’s outrageous. I mean, Marc Andreessen said this on a podcast, the Biden administration telling him, and I don’t know whether it’s true or not that, like, you know, we’re going to tell you which technologies you can and can’t develop. And the Biden folks using the same metaphor of, like, there were certain areas of physics that were not in the public domain during the Cold War, and we’re going to take things out of the public domain, whether he’s accurate in that characterization. But their view is, like, screw you, we will lead and the government is just there to support us in this arms race, basically.
Aya Ibrahim: Yeah. And then when the bubble bursts, then what? Like, who’s going to clean up that mess? Frankly, the math doesn’t math for me on any of this.
Chris Hayes: You’re saying the CapEx expenditures and the —
Aya Ibrahim: Yeah, just the sheer volume of money going into this ecosystem. And it’s like forward momentum that’s driving them, but what are the returns? If OpenAI enters into an agreement with, you know, an Oracle for data centers, at some amount of money over some number of years, but that amount of money exceeds any revenue that they’ve made. And you know, I don’t have access to anybody’s books. So maybe there are numbers that I’m not seeing that would make it make sense.
But at a certain point, this stuff has to become commercially viable, unless you are banking on it being seen as a national security imperative or priority, in which case then an entirely new set of coffers is unlocked for you. Because now, this is a matter of global preeminence or national security and safety. And then it’s a different conversation then they’re making products and they’re trying to make money off the products.
Chris Hayes: That’s interesting.
Aya Ibrahim: You know, they want you to make it easier for them to make money off the products, whether it’s rolling back permitting so that they’re able to build data centers more quickly or, you know, telling states that they can’t regulate the AI at the state level.
Chris Hayes: I have a whole thesis on AI that I’m sort of working on an essay on. So, I’m not going to sort of bore you or the listeners with it here. I’ll sort of develop it further. But I guess my question is how do you understand the stakes of this kind of great power competition with AI? Like, A, do you think it’s real? Do you think it matters who has the edge between the U.S. and China? And B, what is the result you think you want to see to get back to the sort of like human-centered version of it? How should we think in a human-centered way about what we want the outcome of this AI race to be?
Aya Ibrahim: Well, it’s like what do we want this technology to do, right? We want to have the biggest and the most advanced version of it, but to what end? Like, what do we want it to do? Is it just the thing that we want to have to have, or do we have very clear goals or outcomes that we’re driving towards that require this technology? So that’s on the one end.
And then in terms of what people actually need, can we use AI to make healthcare cheaper? Like, if that’s actually a thing and it’s viable, I want to see more of that. I want to see AI if it can be helpful with education, or if it can make housing cheaper, right? We have been constructing housing the same way for a hundred years. There’s been no innovation in the way that we build homes. Can AI help us with that?
I mean, there feels to me so many tangible problems that if this technology is the fix, like if it can solve people’s or humanities’ biggest problems, it would seem like not being able to house people should be up there, not being able to provide them healthcare, not being able to feed them, but that’s not where the attention is. Again, I don’t know the numbers off the top of my head, but I’d imagine that investment in the largest companies relative to, I don’t know, a startup looking at how to use AI for improved agricultural outputs is anywhere close.
Chris Hayes: Right. But even with that, the thing that I keep coming back to, when you talk about healthcare which is a great example, and there are real use cases there. Then there’s actually a fair amount of money being, you know, invested in that direction, to the degree there’s return, or what it’s doing, I can’t say definitively.
But, again, that’s one of those places or housing where, again, someone’s price is another person’s income. If we could automate housing more, we could build probably housing faster and cheaper, and we would also maybe put a bunch of construction workers out of jobs. If we could automate a lot of like medical procedures or routine diagnostics, we would probably make things cheaper and also there’d be fewer jobs in that area.
Aya Ibrahim: Maybe. Right.
Chris Hayes: Maybe. Yeah.
Aya Ibrahim: It’s just a question. I think starting with a view that technology should be viewed as a complement and not a substitute, right? So, it is a way to increase capacity. It is a way to give additional bandwidth. You can do more with less. It does not have to be the case that you displace all of these workers. And if you’re looking to supercharge housing supply, you are going to need to hire a bunch of new people who are not currently in the, you know, construction workforce anyway.
Chris Hayes: Right.
Aya Ibrahim: So, you could see it as a complement. On the displacement of workers because I know that is the hot topic, AI and labor, AI and workers. To me, sure, it’s about the technology, but it’s not about the technology, because whether it’s a new technology or it’s a bad trade deal, like what protections do or don’t exist for workers? What recourse do they have or not have?
Chris Hayes: Right.
Aya Ibrahim: And technology and the debates that we have in tech policy, it’s like time is a flat circle. It’s a forcing mechanism for us to deal with issues we keep kicking the can down the road on.
Chris Hayes: Do you have some list in your head or some way you think about, okay, like I think about this a lot, and actually, my list is so short because I feel so at a loss. So, if you feel that way too, I’m in the same place. But trying to think of like, okay, if we get to the other side of this catastrophe, this national catastrophe, what is happening in the country right now, and we have people that I think are good faith and who share my values back in power, here’s what I want to see happen, or here’s what has to happen to fix the system, or shore it up, or reform it in such a way that we’re not back here again.
Like, as someone who worked, you know, inside the National Economic Council and State, and has been inside of an administration, do you think about that these days? And do you have a list? Is there like some, like, we have to make sure we do this, if we get back in?
Aya Ibrahim: So, in terms of policy, it’s two things at the top of my list, which is housing and childcare. Some of this is, to the extent that people have what they need, then there is more capacity on their end to do the kind of civic engagement and advocacy that we want to have in a healthy democracy and would push us to, you know, move on other issues that are important and relevant, and give us the political capital or urgency to do so. So, there’s that.
In terms of, you know, government as a structure or organization, I think that there are big questions that we should be thinking about. So, on the topic of economic security, for example, there are a bunch of functions that are spread across multiple agencies. You know, Japan set up a ministry, or they set up a bureau just for economic security within their ministry, I think, for like econ trade and maybe investment. Do we want to set up something that basically encompasses all of the economic security work, and tools, and policymaking under one place? Do we want that to be separate? Is it under state? Is it under commerce? I think there are like basic government design questions.
And to bring it back to people, it really has been six, seven months of targeting and terrorizing, and just awful treatment of public servants, right? People who made the decision, they’re going to come into government, come into these agencies and they’re going to take a job that pays them less than what they would make in the private sector, to hopefully make a difference, make people’s lives better, make government work better.
Morale has been decimated. And so, whatever it is that we do when we come back, it cannot be put everything back where it was. We tried that before and it doesn’t work. And there’s a lot of work to be done to restore trust and faith, not just with the American people, but with those who were serving in government, because how do you convince people to come back in when the thing that you were supposed to have, given all of the trade-offs on pay and work-life balance, is you would have some safety, some stability, some security, and that has been ripped away. So, there’s going to be a rebuilding of the workforce piece too, like organizational restructuring, all of that.
But above all else, I want us to be super creative and super bold, right? If we were going to think about these agencies and build one today, you know, what would that look like? I don’t think that we need to be constrained by how things have been. We’ve done that for too long and it doesn’t work, including these people aren’t.
Chris Hayes: Aya Ibrahim served as a senior advisor on the Secretary of State’s Policy Planning Staff in the Biden-Harris administration. Also, she’s a former senior policy advisor at the National Economic Council and led President Biden’s Blueprint for an AI Bill of Rights and Digital Assets Executive Order. That was great, Aya. Thank you so much.
Aya Ibrahim: Yeah. Thank you.
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