News clip: The latest reading on consumer sentiment from the University of Michigan showed the index falling to a six-month low, largely on inflation fears.

Micah Loewinger: This week, bad feelings and good data from the economy have some saying the vibecession is back. From WNYC in New York, this is On the Media. I'm Micah Loewinger. Also on this week's show, Joe Biden once decried Donald Trump's tariffs on China, now, he's enacted his own, but no matter the political party, the consequences appear to be the same.

Gordon Hanson: Surprise, surprise, you raise prices on imported goods, you're raising prices for American households.

Micah Loewinger: Plus, overpromising and underdelivering is par for the course in the tech world, especially when it comes to AI.

News clip: : Latest version ChatGPT-4 can even pass the bar exam with a score in the top 10%, and it can do it all in just seconds.

Julia Angwin: That claim was debunked recently.

Micah Loewinger: It's all coming up after this.

Announcer: Listener-supported WNYC Studios.

Micah Loewinger: From WNYC in New York, this is On the Media. Brooke Gladstone is out this week, I'm Micah Loewinger. Fresh data on how Americans feel about the economy is officially out, and people are not happy.

News clip:  The latest reading on consumer sentiment from the University of Michigan showed the index falling to a six-month low, largely on inflation fears.

Micah Loewinger: A new poll this week for The Guardian found that the majority of Americans think we're in an economic recession, and they blame the Biden administration, even though the economic indicators say that we aren't in a recession.

News clip:  The consumer price index showed inflation cooling ever so slightly in April, coming in at 0.3% month over month, slightly lower than we saw in March.

News clip: Again, it's an improvement. By the way, that core rate, that is the best reading of inflation since April of 2021. There is--

News clip:  The unemployment rate remains under 4%. It's now been under 4% for 27 months straight. That's over two years. That's the longest stretch since the 1960s.

Micah Loewinger: That combination of bad feelings and good numbers has had some in the press announcing the return of the vibecession. You remember that phrase. It was originally coined in the summer of 2022 by economic analyst, Kyla Scanlon.

News clip:  The vibecession is this idea of a disconnect between consumer sentiment and economic data and why people feel bad about the economy despite the economic metrics telling them that the economy is doing okay.

Micah Loewinger: We've seen the vibecession is over-news cycle happen a couple of times. Scanlon said so herself in the summer of 2023 and again this past January.

Kyla Scanlon: It wasn't a recession; it was a vibecession, and I'm thrilled to say that it's over.

Micah Loewinger: What some financial journalists are saying, not so fast, including Jeanna Smialek, who's a reporter for the New York Times covering the Fed and the US economy. Which is it, Jeanna?

Jeanna Smialek: The vibes have been changing in fairness to everybody involved here. We did see a real improvement in consumer confidence for a little bit there as inflation was cooling. I think people were reading these very positive headlines. It didn't really seem like people were reacting to that. You saw improvements across a number of indexes that measure how people feel about the economy, and we seem to be seeing some backtracking there recently. I think that probably has less to do with the fact that inflation has gotten appreciably worse in that period and more to do with the fact that inflation has stalled out. We're not seeing the progress that we previously were, and that has been in the headlines a lot.

The other thing that has really fundamentally changed over the last couple of months for people is that as of the end of 2023, as of late last year, we were all expecting the Fed to make several interest rate cuts this year. We thought that borrowing costs, so mortgage rates, credit card rates, all those good things, that they were going to come down pretty substantially in 2024, but because inflation is proving a little bit more stubborn than anybody had expected, it seems increasingly unlikely that rates are going to come down very much if they come down at all.

That one-two punch of inflation being a little bit more stubborn and that being in the headlines in a negative way, and the fact that interest rates, which are an expense for a lot of households, are likely to stay higher longer is probably combining to make people feel less confident about the economy.

Micah Loewinger: Let's zoom out a little bit. What would you say is the good news about the economy right now?

Jeanna Smialek: There's a lot of good news about the economy right now. For one thing, unemployment is very low, and it has been very low for a really long time. We've still got joblessness under 4%, which is not at all usual for this stage in a business cycle at this point in the Fed rate hike cycle. It's surprising how resilient this labor market has been.

That just breeds all kinds of other good things. When you've got unemployment this low, you see pretty solid wage gains. We've been seeing very strong wage gains for quite a bit now. We're seeing some pickup in productivity, and it's difficult to say how real that is, but it does seem like we might be seeing productivity increases in a way that we hadn't in a long time. That could potentially be very good news for the economy because that's the kind of thing that can fuel strong growth into the future, which then in turn can help--If the economy's growing rapidly and people are spending and businesses are expanding, that helps keep unemployment low.

We do seem to be in this otherwise pretty positive cycle where consumers are spending, businesses are still expanding, maybe a more muted pace than before, but still pretty solid. People are still hiring. In general, it's a very strong economy out there.

Micah Loewinger: What do you make of the argument that people simply don't see good news for what it is? I want to play you a clip from Jared Bernstein, President Joe Biden's top economic adviser last July.

Jared Bernstein: I think people have been definitely somewhat shaken up by what they've been through. I think what the president did when he got here was to say, "We have to get back to normal as quickly as possible." It may take a while for that renormalization to work into people's consciousness, but we're starting to see some of it now. I happen to think that--

Jeanna Smialek: I do think it's the case that people felt pretty good about their finances coming out of the pandemic because they had gotten a couple of one time checks and that helped people pay off debts, it helped them pay off student loans with this positive in people's life and now they've worked their way through that. I think that there are a lot of people out there who are probably benchmarking off of that as the normal, like maybe a world in which you got a stimulus check temporarily felt like it was the normal, and now we're back to a world where that's just not happening.

The pandemic disrupted economic life in a pretty serious way. Then the response to the pandemic shook up economic life in a pretty serious way, and we are still trying to figure out what normal looks like.

Micah Loewinger: The vibe stuff is honestly confusing for me. After the consumer price index data came out last week, the stock market jumped. The S&P, the Nasdaq, and the Dow all hit record highs. Is that true?

Jeanna Smialek: Yes. Stock market vibes are good. That seems pretty obvious.

Micah Loewinger: Where is the ambiguity about vibes? Who's feeling the pinch exactly?

Jeanna Smialek: I think it's a lot of the lower-income consumers who are not necessarily benefiting so much from these run-ups in asset prices.

Micah Loewinger: What about the fact that wages are up across the board? In December, the Treasury released data showing Americans in the bottom 25% of the country's income distribution have seen the most growth in real wages over the past four years, about 3.2%, or about $150 a week.

Jeanna Smialek: What you see if you look at the economic data to try and gauge how households are doing financially, is that you've got delinquencies rising for auto loans and on credit card debt, particularly among younger and lower-income households. It does seem like there's a subset of American society that's really under a lot of pressure right now financially. Those people are probably not feeling so great.

I also think that there is a real danger of attributing too much weight to the stock market. The stock market reflects how businesses are performing and what their earnings outlook is. It does not necessarily reflect how people are feeling about the broader economy. It certainly can reflect that. The stock market can go up because people are feeling better about the economy, but it can also go up because people are feeling good about what AI is going to mean for a tech company's bottom line, which has very little to do with how people are feeling about the broader economy. I think that that's an important distinction to make.

Micah Loewinger: I want to ask you about the negative sentiment data. That's based on surveys, right? Polling, which is almost always more complicated than a hard number or percentage suggests. Are there any nuances that you think have gotten lost in the coverage?

Jeanna Smialek: I think one important nuance is that how people feel about how they're doing versus how they're actually doing, there's often a disconnect there. One thing that I think has been really unique about this cycle, or really interesting about this cycle, is that you've seen people saying that they feel very bad about their economic positions and they feel very bad about the economy, but then when you ask them about their actual personal finances, they'll tell you they feel okay about those. When you ask them about their spending intentions, they'll be like, "Yes, I'm spending."

They're very optimistic about their spending outlook, and we're seeing consumers spend quite a bit. If you really felt personally bad about the economy, presumably you would be tightening the belt a little bit, and that's really not the dynamic we've been seeing at all.

Micah Loewinger: That said, not everyone is so bullish on the term "vibecession" itself. One critique that I've seen earlier this year in The Atlantic was a piece that quoted the work of economists, Ben Harris, and Aaron Sojourner at the Brookings Institution, who compared an index of the sentiment of economic coverage in a set of mainstream newspapers with what is actually happening in the economy. They found that from 1988 to 2016, changes in the two tracked pretty closely together, but at the beginning of Donald Trump's presidency, coverage got way more negative than the economic data would predict.

The Atlantic wrote, "After Joe Biden took office, the gulf widened even more. The researchers found that from 2017 to 2023, the media's negativity gap was nearly five times larger than it was during the previous three decades." What do you make of this argument that news coverage might be contributing to how people say they feel about the economy?

Jeanna Smialek: We need to not just simplistically say like, oh, the media is negative, the media negativity is creating a negative echo chamber that is making us all feel bad. I think we also have to think, did we feel bad in the first place, and is that why the news has gotten more negative? I think in this case, actually, it lines up pretty neatly with the economic story that we've been more broadly discussing, which is for the first time since the 1980s, so for the first time in really four decades, we have significant inflation.

Prior to this, I think the economic data that we were all trying to think that everything aligned with was the job market data. The job market was really the main game in town for the first 10 years of my career personally. We were all just watching what happened with every employment report. The employment reports tended to track really, really well with how everybody felt about the broader economy. Everything boiled down to the job market.

Then the inflation took off starting in 2021, but really most painfully in 2022. I think that fundamentally changed the economic conversation. I think it really changed how people feel about the economy. Part of the reason the media narrative remains pretty negative, even with a strong job market, is that we're reflecting how people feel about the inflation.

Micah Loewinger: Then there's the fact that we now have generations of people who have lived through a quick succession of larger economic hardship, the 2007/2008 financial crisis, and then the pandemic.

Jeanna Smialek: A quick succession of economic hardship and also a pretty fundamentally changing economy. I think some pretty large things have shifted generationally in ways that really matter. I talk to a lot of people in the millennial and Gen Z generations these days, and these two generations are not super optimistic about their home ownership prospects. I think we saw millennials starting to jump into the housing market in a pretty big way in 2020, but they've been struggling in recent years.

Talked to a lot of Gen Z, and they were never going to buy houses. Look how much they've increased in price. I just think some of those milestones that used to be a standard part of the American economic experience feel increasingly out of reach. That also bears on how people feel about the economy and their economic prospects.

Micah Loewinger: Maybe to the financially illiterate like myself, one vibe I got from the vibecession news coverage was this-- You know The New York Times Pitchbot Twitter account? I'm sure you're familiar with it.

Jeanna Smialek: I am. I am very familiar.

Micah Loewinger: [laughs]

Jeanna Smialek: They like to make fun of me, so.

Micah Loewinger: Okay. Okay. You're going to know where I'm coming from, but there is a like-- the economy's doing, and that's a problem for Joe Biden anyway. That was the sort of sense I got from a lot of the vibecession coverage. Maybe I'm totally misreading it, but there did seem to be a kind of, we're going to hold this guy's feet to the fire. I'm going to play something up that wasn't super born out in the data. Did you ever get that criticism?

Jeanna Smialek: Oh, I got a lot of that criticism, but I feel that it is perhaps misfounded. I obviously continued writing stories the way I continued writing them, which was very much in tone acknowledging the fact that people felt bad about this inflation. I think that you can't choose which data you're going to look at. I think you've got to look at all of the data. What we saw in this cycle is that it is absolutely the case, and some of the hard economic data looks really awesome.

That said, I don't think we can just completely ignore consumer confidence data because it doesn't line up. It has been really negative. It's looked really bad and it is looking worse again recently. I think you also just can't ignore when you're doing reporting and when you're talking to people out in the world and they're saying like, what is this great economy I'm hearing about? That does not comport with my lived experience at all.

I feel like we would be remiss as journalists to just ignore that. Our job is to reflect the world as people are experiencing it, not the world as six government surveys that we have decided are the only ones that matter are reporting it. It can be the case that the non-farm payroll survey looks really positive, but that can't just be the only thing we're paying attention to in this world. I don't think that would be journalism.

Micah Loewinger: Jeanna, thank you very much.

Jeanna Smialek: Thank you for having me.

Micah Loewinger: Jeanna Smialek is a reporter for The New York Times covering the Fed and the US economy. She's also the author of the book, Limitless: The Federal Reserve Takes on a New Age of Crisis. Coming up, the bizarre tariff wars playing out in Washington. This is On the Media.

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This is On the Media. I'm Micah Loewinger. With economic anxiety on the rise, former president, Donald Trump, is hoping to pin blame on current president Joe Biden.

Donald Trump: Everything is more expensive, a lot more expensive actually because of Joe Biden's reckless policies that have caused soaring energy costs and currency inflation. Inflation is destroying. They call it a country killer. Going back hundreds of years, Germany, countries that had big inflation are dead. They become dead countries.

Micah Loewinger: His messaging may be working. According to a new poll out this week from Cook Political Report, nearly 60% of Americans in swing states think Biden has at least some control over inflation, and more voters trust Trump than Biden to get their cost of living under control. Meanwhile, on the campaign trail, Trump is recycling one of his favorite bits, China. Specifically, how they're owning us when it comes to trade.

Donald Trump: China is right now our boss. They are the boss of the United States, almost like we're a subsidiary of China.

Micah Loewinger: Then last week, Biden announced a major new economic policy, trade tariffs that build on the tariffs Trump put on a slew of Chinese-made goods during his term.

News clip:  Big economic announcement from President Biden, $18 billion in new tariffs on Chinese imports.

News clip: The tariffs on electric vehicles go from 25% to 100%.

News clip:  He's slapping a 25% tariff on steel and aluminum. He's also adding a 50% tariff on semiconductors in this--

Micah Loewinger: In response this week, Trump threatened to up the ante if he's elected.

Donald Trump: I'm the one that saved the steel industry with tariffs. His is just a limited thing. I saved it with tariffs and they have to go up.

Micah Loewinger: This sudden bipartisan love of raising tariffs is remarkable because it's a total reversal of a decades-long consensus in Washington when both Republican and Democratic lawmakers agreed that lowering tariffs was the best thing for the economy. To understand how we got here, I spoke with Gordon Hanson, an economist and a co-director of the Reimagining the Economy Project at Harvard University's Kennedy School. He's done extensive research on the economic and political impacts of Trump's tariffs. Gordon, welcome to the show.

Gordon Hanson: Thanks for having me.

Micah Loewinger: Starting in 2013, you and a team of economists started publishing research on what you dubbed "The China Shock." Can you define that term?

Gordon Hanson: Sure. China joined the global economy in fits and starts beginning in the 1980s and in the 1990s. As its economy was moving away from decades of Mao's central planning to something that was more market-oriented, something pretty phenomenal happened. China underwent a period of about 20 years of economic growth, the likes of which we've never seen. We've seen economies grow fast. We've never seen an economy as big as China's grow that fast.

The other thing we hadn't seen was a country as big as China be as specialized as it was in a pretty narrow set of manufacturing products. This just upended global markets. If you were producing stuff that China needed to fund its global factories, so that would be iron ore, that would be copper, that would be all sorts of primary commodities that places like Australia and Canada and Brazil and South Africa and Indonesia were producing, it was boom times. This was just an unbelievable windfall. If you were producing the stuff that China was also producing, textiles and furniture and clothing and simple electronics, it was a nightmare scenario. All of a sudden, the world market was flooded with goods that were the basis for your livelihood.

In the US, regional economies tended to be pretty specialized in a handful of products. Martinsville, Virginia, for instance, had a half of its working-age population employed in manufacturing that produced basically two things, textiles, mainly sweatshirts, and furniture. The growth of China overnight meant just complete upheaval in economies like Martinsville's and other places in the United States that had been dedicated to producing manufactured products.

Micah Loewinger: Then enter Donald Trump in 2017.

Donald Trump: I'll bring back our jobs from China, from Mexico, from Japan, from so many places. I'll bring back our jobs and I'll bring back our money.

Gordon Hanson: When Trump was campaigning on a message of America first and countering the era of hyper-globalization, it resonated in parts of the world that felt like they'd been punched in the gut by the global economy. His prescription was, well, China has flooded the market with US goods, let's put taxes on Chinese imports, and that's going to save those regions that had been part of the US manufacturing base.

Micah Loewinger: He put tariffs on solar panels and washing machines, then steel and aluminum, and then a 25% tariff on all kinds of goods from China. How did China respond?

Gordon Hanson: China responded by putting tariffs on the goods that the US exports to China. The complicated thing here is that a lot of what the US exports to China are services and intellectual property and stuff that's very hard to tax at the border. We don't export a lot of physical goods to China outside of agriculture and minerals. What that meant was China was left with a pretty narrow set of options of what to hit with countervailing duties, and that primarily fell on the agricultural goods that are produced in the American heartland.

Micah Loewinger: When you were watching this trade war escalate beginning in 2017, as an economist, what was going through your mind?

Gordon Hanson: As a public citizen, I was concerned that the US was embarking on a set of wrong-handed economic policies. As an economist, I was fascinated because the US had spent the better part of five decades dismantling trade barriers, slowly moving towards an ever more globalized world. From one day to the next, basically, Trump had upended that situation and moved us towards much higher trade barriers, and that meant a reduction in international trade. We were just waiting for the data to come out so that we could begin to track what was the impact of Trump's trade protection.

Micah Loewinger: Did the trade war help American workers?

Gordon Hanson: It did not. We took a very close look at the data. This is work I did with Anna Beck, David Otter, and David Dorn tracking all the goods that the US imports from all countries in the world at a highly disaggregated level. Then we match those goods to where they were produced in the United States to say, well, if the US now has increased tariffs on, say, sweatshirts, are the places that were producing sweatshirts now going to start producing them again?

We tracked this from 2018 when the tariffs really started to bite through 2019 and all the way out to 2022, which at the time was as far as we could push the data. What we found in terms of impacts on US manufacturing employment was a big nothing. There was really no change in employment in response to those tariffs.

Micah Loewinger: Do we have any good data on how these Trump and now Biden tariffs have impacted the price of goods?

Gordon Hanson: Here's the wild thing about the Trump tariffs. The first evidence we saw of their impacts was really shocking. It showed that tariffs led for a one-to-one increase in prices as those goods were entering the United States. That meant that a 25% tariff would mean that prices were 25% higher. We first documented that in looking at wholesale prices of goods. As those goods went from wholesalers to retailers, the retailers ate part of that margin. The price increases that were passed on to American consumers weren't the full 25%, but they were a pretty good chunk of it. Surprise, surprise, you raise prices on imported goods, you're raising prices for American households.

Micah Loewinger: In the conclusion of your paper, you write that, "The net effect of import tariffs, retaliatory tariffs, and farm subsidies on employment in locations exposed to the trade war was at best a wash. It may have been mildly negative, but residents of tariff-protected locations became less likely to identify as Democrats and more likely to vote for Trump." Why do you think that happened?

Gordon Hanson: Well, again, it was effective messaging. The workers in America's heartland in the Midwestern states that had been part of America's manufacturing base going back decades felt betrayed when, in the 1990s, President Clinton signed the North American Free Trade Agreement.

President Clinton: The United States must seek nothing less than a new trading system that benefits all nations through robust commerce but that protects our middle class and gives other nations a chance to grow one.

Gordon Hanson: Between Clinton signing the North American Free Trade Agreement and Donald Trump coming into power, the China shock happened. First, NAFTA was a symbolic betrayal of American workers. Then the China trade shock was an actual economic storm that really upended the regions that had been manufacturing centers for much of the last 60 or 70 years. They were waiting for somebody to come and say, we're on your side. Trump provided that message.

Micah Loewinger: This is the part I don't totally understand. Was it that Democrats didn't adequately communicate the downsides of free trade, that it could potentially really hurt American workers, or is it that they earnestly believed that opening up trade with more countries like China and Mexico would deliver prosperity for American workers?

Gordon Hanson: To understand how we got to the point that democratic presidents were advocating for free trade, kind of important to go back to where the push for globalization came from.

Coming out of World War II, the world was a mess. We created a set of institutions that would help countries trade with each other and help create global prosperity. For decades, the community of trading nations was pretty much high-income countries. It was the US, it was Europe, it was Canada, it was Japan. When those countries traded with each other, it tended to be like for like, the US sending pickup trucks to the rest of the world and importing small sedans from Japan or luxury sedans from Germany. We had a sense that globalization wasn't going to be that disruptive.

In the 1980s and 1990s as President Clinton was now beginning to sign new free trade agreements-- It wasn't just democratic presidents, the North American Free Trade Agreement, though it was signed by Clinton, it was first conceived of by President Bush. We were now envisaging expanding trade with low-income countries, countries we hadn't traded with substantially before. Then China comes onto the scene. We now have not just low-income countries but really big low-income countries. We didn't have mechanisms in place that would help workers adjust to the very real changes in the global marketplace that occurred as countries like China came onto the scene and began expanding their exports in rapid course.

Micah Loewinger: Our listeners are already hearing a lot of technical economic terms coming up in the campaign. Trump, for instance, likes to talk about things like trade deficits and currency devaluation.

Donald Trump: Joe Biden has run up record trade deficits, also known as losses. China's killing us. They're devaluing their currency to a level that you wouldn't believe. It makes it impossible for our companies to compete.

Micah Loewinger: Biden is talking about things like intellectual property protection.

Joe Biden: China is stealing intellectual property. China is conditioning being able to do business in China based on whether or not you have 51% Chinese ownership.

Micah Loewinger: What do you think news consumers and voters need to know about these terms in order to understand the campaign rhetoric and make an informed decision?

Gordon Hanson: If you're talking to me about trade deficits, you aren't talking to me about good jobs. I would avoid fancy arguments that are taking us towards esoteric policy tools and away from the primary challenge that we face, which is higher incomes for American workers who didn't go to college.

Micah Loewinger: I feel like you have a bone to pick with trade deficits. Do you want to just explain why you think there's too much focus on trade deficits?

Gordon Hanson: What is a trade deficit? A trade deficit is when we buy more from other people than they buy from us. Full stop. It means our imports are greater than our exports. Now it might make sense to say, well, the reason that's happening is because the people we're trading with are not letting our goods in and we're letting their goods in. As attractive as that reasoning sounds, is wrong. Trade deficits aren't about trade barriers. They aren't about tariffs. Trade deficits are about your savings and investment being different from my savings and investment.

The US doesn't save very much and it invests a lot more than it saves. As a consequence, we need to borrow from the rest of the world in order to do so. That borrowing takes the form of a trade deficit. That trade deficit becomes this big attractive target that people like Donald Trump can come along and say, "I'm going to solve it with tariffs." Lo and behold, what has happened to US trade deficits since Trump's tariffs went into effect in 2018? They've gotten bigger.

Micah Loewinger: This time is going to be different, Gordon.

[laughter]

Gordon Hanson: I'll take the other side of that bet.

Micah Loewinger: Gordon, thank you very much.

Gordon Hanson: My pleasure, Micah. This has been really enjoyable for me.

Micah Loewinger: Gordon Hanson is an economist and the co-director of the Reimagining the Economy Project at Harvard University's Kennedy School. Coming up, tech journalists are feeding the AI hype machine. Maybe they should not do that. This is On the Media.

This is On the Media. I'm Micah Loewinger. Last week, OpenAI released a demo of its latest technology. Its text-based software, ChatGPT-4o. Which responds to prompts and now has a new voice. A few actually, but this one called Sky got the most attention.

Sky: You've got me on the edge of my, well, I don't really have a seat, but you get the idea. What's the big news?

Micah Loewinger: People online said the demo reminded them of a 2013 film about a man who falls in love with his AI voice assistant performed by Scarlett Johansson.

[music]

Scarlett Johansson: Good morning, Theodore.

Theodore: Good morning.

Scarlett Johansson: You have a meeting in five minutes. You want to try getting out of bed? Get up.

Theodore: [chuckles] You're too funny.

Micah Loewinger: Within hours of the demo's release, OpenAI's CEO, Sam Altman, tweeted the word Her, the name of that very film, which by the way, he has publicly described as an inspiration for his work. Then, days later--

News clip:  The actor says she turned down the offer to be the voice of the artificial intelligence system and that they made one that sounded just like her.

Micah Loewinger: Johansson said Altman approached her eight months ago, and she turned down his offer to lend her likeness to the software. He approached her again just two days before the release of the demo.

News clip:  She said, "I was shocked, angered, and in disbelief that Mr. Altman would pursue a voice that sounded so eerily similar to mine that my closest friends and news outlets could not tell the difference."

Micah Loewinger: In response to requests from Johansson's lawyer, OpenAI has said they're discontinuing the voice they called Sky, but the company maintains they hired a voice actor for the job before approaching Johansson and made no attempt to emulate the actor. The debacle emphasized how these large language models often rely on human labor and data, often taken without permission. Despite its problems, so many AI boosters in Silicon Valley and members of the press say that artificial intelligence holds the keys to a shining future.

Narrator: We may look on our time as the moment civilization was transformed as it was by fire, agriculture, and electricity.

Sam Harnett: Oh, man. When the AI coverage started, I thought, here we go again. This is the same old story.

Micah Loewinger: Sam Harnett is the author of a 2020 paper titled Words Matter: How Tech Media Helped Write Gig Companies Into Existence.

Sam Harnett: I wrote it because I was really disappointed with the coverage I was seeing and some of the coverage I ended up doing.

Micah Loewinger: Today, Sam hosts a podcast called Ways of Knowing, but back in 2015, he was a tech reporter for KQED in San Francisco, filing stories for Marketplace and NPR.

Sam Harnett: I was a young reporter. You got to do these quick stories, and before you know it, you're using all these words like startup or tech or platform. I started thinking, these words themselves are misleading, like rideshare for an Uber? What are you sharing? You're paying someone to drive you around. You're not sharing anything. [chuckles]

Micah Loewinger: These euphemisms were pushed by the tech industry and quickly adopted by the press during the early days of the gig economy. In his paper, Sam listed off several styles of media tropes that defined that era. Like the first-person review. He points to a Time Magazine cover story titled, Baby, You Can Drive My Car, and Do My Errands, and Rent My Stuff.

Sam Harnett: In those experiential first-person stories, they're not critical at all. It's all about how you're engaging with this thing and what it's like. Even when they are critical, you're still giving them a lot of free advertising by casting it as a totally new thing.

Micah Loewinger: Yes, but on the consumer side, you could see where your car was before it got to you. You could see who the driver was. You could know how much it was going to cost. You didn't have to give cash to a stranger in a car. That's innovation. No?

Sam Harnett: Well, you look at Uber and Lyft, they were using GPS and phones. GPS had been around for decades. Phones were relatively new, but Uber and Lyft didn't invent the phones. Really, the innovation seemed to be ignoring local transportation laws and ignoring labor laws, and it was all being cast as techno-utopianism. This inevitable future of work.

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News clip:  It's a mass transit revolution sparked by the universal ride-sharing company that goes by only a block letter U on its windshield. Of course, we're talking about Uber.

News clip:  I hope and that all regulators will take the time to understand that most of these drivers greatly value the freedom and flexibility to be able to work whenever and wherever they want.

News clip:  The industry wants those drivers to stay independent contractors. That's cheaper for those companies. It's also at the core of their business.

News clip:  What Uber does, this is the future. It is the sharing economy. The marketplace will win, but we've got to support them.

Sam Harnett: Really, it was the passive work. I think it was talking to a lot of taxi drivers and realizing that this is work that has no social safety net. This is work that has no overtime. There's no guaranteed minimum wage. Work that's undoing protections that were hard-fought 100 years ago.

Micah Loewinger: Meanwhile, some outlets focused on what Sam Harnett calls the outlier worker profile. CNBC wrote about 38-year-old, David Feldman, who "quit the rat race" and left his finance job to make six figures picking up gigs on Fiverr, a site that connects customers with freelancers. The Washington Post ran a story titled Uber’s Remarkable Growth Could End the Era of Poorly Paid Cab Drivers, which cited these claims from the company.

News clip: The people that drive their taxis barely break even, whereas someone who drives an Uber can make a net $90,000 a year.

News clip:  The median pay for Uber drivers in New York City, $90,000 a year for a 40-hour work week.

News clip: Wow. That is the same as a post-secondary science teacher and a financial analyst here. That's a lot of money

Micah Loewinger: Claims that landed Uber in court.

News clip:  The Federal Trade Commission will send nearly $20 million in checks to Uber drivers. This is all part of a settlement with the ride-hailing company. The FTC found Uber exaggerated the yearly and hourly income drivers that they could make in certain cities.

Micah Loewinger: Instead of pressing Silicon Valley executives on how these companies were, say, misleading workers, many journalists did uncritical interviews.

Guy Raz: They were threatening to sue you, right?

John Zimmer: They were threatening to shut us down.

Micah Loewinger: Host, Guy Raz, in 2018 interviewing Lyft CEO, John Zimmer for NPR's podcast, How I Built This.

John Zimmer: The opportunity was massive and the regulatory obstacles were just as massive.

Guy Raz: How long did it take for you to overcome those initial regulatory challenges? Was it months, years?

John Zimmer: I'd say at least a year. Probably for that first year.

Sam Harnett: They cast the people running these companies as heroes who overcome adversity.

Micah Loewinger: Sam Harnett.

Sam Harnett: Who create a thing that the listener want to succeed. It's astonishing how the tech industry keeps finding ways to get lots of media coverage that ends up turning into lots of investment and lots of power. Speed is imperative, and if they can get up and running quickly enough and if their business model can become a thing that's regularly used by consumers and embedded in society, then they become too big to regulate.

Paris Marx: I think we see it with a lot of new technologies, whether it's the gig economy, whether it was with crypto a few years ago, whether it's AI.

Micah Loewinger: Paris Marx is the host of a podcast called Tech Won't Save Us, and the writer behind the Disconnect newsletter.

Paris Marx: We often see these very rapid embraces of whatever the next new thing from the tech industry is and less of a desire to really question the promises that the companies are making about them.

Micah Loewinger: Marx agrees that some of the same media tropes that Sam Harnett identified are recurring now with AI, like the first-person review.

Paris Marx: After ChatGPT was released in November of 2022, the companies were selling that we were potentially even closer to computers matching human-level intelligence. One of the things that we saw a lot of media organizations doing was actually going onto ChatGPT and having conversations with it, and there's a really striking example of this that was published in The New York Times by Kevin Roose, their tech journalist, and he basically had this two-hour conversation with this chatbot, which he said wanted it to be called Sydney. It had its own name. It was telling him that it wanted to be alive and was ultimately asking Roose to leave his wife and have a relationship with the chatbot.

The way that it was written, it was ascribing intentionality to this chatbot. It was thinking. It was having these responses. It was feeling certain things when actually we know that these chatbots are not doing anything of the sort. The science fiction author, Ted Chiang, basically called these chatbots autocomplete on steroids. We're used to using autocomplete on our phones when we're texting people, it's suggesting the next word, and this is just taking it to a new level.

Micah Loewinger: The fact that a nascent chatbot with millions of dollars of funding behind it would say such outrageous things, is that not in and of itself newsworthy, even if the chatbot's own claims about its human-like intelligence were just outright wrong?

Paris Marx: I think it definitely can be, but then the question is, how do you frame it and how do you explain it to the public? This was February of 2023. ChatGPT was released at the end of November of 2022, so we were still really early in the public's getting to know what this technology was. It really misleads people as to what is going on there.

Micah Loewinger: Another trope that Harnett lays out in his paper is his discussion of the founder interview. Today, we've seen so many fawning conversations with tech leaders who are at the forefront of artificial intelligence.

Paris Marx: Absolutely. One of the ones that really stands out, of course, is an interview that Sundar Pichai, the CEO of Google, did with 60 minutes back in April of 2023, and in this interview, Sundar was talking about how these AIs were a black box and we don't know what goes on in there.

Sundar Pichai: Let me put it this way. I don't think we fully understand how a human mind works either.

Paris Marx: One of the biggest problems there was not just what Sundar Pichai was saying, but that the hosts of the program who interviewing him and conducting this were not really pushing back on any of these narratives that he was putting out there.

Scott Pelley: Of the AI issues we talked about, the most mysterious is called emergent properties.

Micah Loewinger: Scott Pelley of 60 minutes.

Scott Pelley: Some AI systems are teaching themselves skills that they weren't expected to have. For example, one Google AI program adapted on its own, after it was prompted in the language of Bangladesh, which it was not trained to know.

Micah Loewinger: After the piece came out, AI researcher Margaret Mitchell, who previously co-led Google's AI ethics team, posted on X saying that, according to Google's own public documents, the chatbot had actually been trained on Bengali texts, meaning this was not evidence of emergent properties. Here's another exaggeration that made its way into a TV news piece.

News Presenter 2: The latest version ChatGPT-4 can even pass the bar exam with a score in the top 10%, and it can do it all in just seconds.

Micah Loewinger: ChatGPT-4 scored in the 90th percentile on the bar exam. Was that legit?

Julia Angwin: Yes, so that claim was debunked recently.

Micah Loewinger: Julia Angwin is the founder of Proof News. She recently wrote an op-ed for the New York Times, titled Press Pause on the Silicon Valley Hype Machine.

Julia Angwin: An MIT researcher basically reran the test and found that it actually scored in the 48th percentile. The difference was that when you're talking about percentiles, you have to say, who are the other people in that cohort that you're comparing with? Apparently, OpenAI was comparing to a cohort of people who had previously failed the exam multiple times. [chuckles]

Micah Loewinger: OpenAI compared its product to a group that took the bar in February, they tend to fail more than people who take it in July.

Julia Angwin: When you put it compared to a cohort of people who had passed it at the regular rate, then you got to this 48 percentile. The problem is that paper comes out, it's peer-reviewed, and it's like goes to the academic process that comes out like a year later than the claim.

Micah Loewinger: Tell me about Devin. This was a red-hot product from a new startup that claims to be an AI software engineer. Can it do what its creators claim it can do?

Julia Angwin: Devin is from this company called Cognition, which raised about $21 million from investors and came out with what they called an AI software engineer that they said could do programming tasks on its own. The public couldn't really get access to Devin, so there wasn't anything to go on, except these videos of Devin's supposedly completing tasks.

Speaker: I'm going to ask Devin to benchmark the performance of Llama and a couple of different API providers. From now on, Devin is in the driver's seat.

Julia Angwin: The press wrote about it as if it was totally real. Wire did a-- forget chatbots, AI agents are the future with the headline, Bloomberg data breathless article about how these programmers are basically writing code that would destroy their own jobs. There was a software developer named Carl Brown, who decided to actually test the claim.

Carl Brown: I have been so professional for 35 years.

Micah Loewinger: Here's Carl Brown on his YouTube channel, Internet of Bugs.

Carl Brown: For the record, personally, I think generative AI is cool. I use GitHub Copilot on a regular basis. I use ChatGPT, Llama 2, [unintelligible 00:43:44] Fusion, all that kind of stuff is cool, but lying about what these tools can do does everyone a disservice.

Julia Angwin: He took one of these videos where Devin was aiming to complete a task, and he tried to replicate exactly what was happening. He did the task in 36 minutes. The timestamp in the video show that it took Devin more than six hours to do the task. What Carl says is that--

Carl Brown: Devin is generating its own errors, and then debugging and fixing the errors that it made itself.

Julia Angwin: The company basically acknowledged it actually, in tweets. They didn't respond to my inquiries, but they basically said, "Yes, we're still trying to make it better," but it was one of these things where it was a classic example of like, journalists shouldn't believe just a video that claims to show something happening without actually taking a minute to even carefully watch the video or ask to have access to the tool themselves.

Micah Loewinger: If I started a company and raised millions of dollars in funding, I would be under a lot of pressure to prove to the public that it works, and you'd think that people who cover Silicon Valley understand that dynamic.

Julia Angwin: Totally. I will tell you that after my piece ran in the New York Times questioning whether we should believe all this AI hype, a reporter at Wired did an entire piece, basically trashing my piece. The title of it was, "We should believe the AI hype." [laughs]

Micah Loewinger: Really?

Julia Angwin: Yes.

Micah Loewinger: What was their argument?

Julia Angwin: Basically, that in the future, I will be proven wrong, because it will all get better. That's the company's argument too, which is like don't believe your lying eyes, believe the future that I'm holding up in front of you. I think for journalists, I don't think our role is to call the future, I think our role is to assess the present and the recent past.

Micah Loewinger: The recent past tells us that big tech is very good at generating hype in the press and using venture capital to grow really fast and influence regulators. I'm not predicting this will happen with AI, it's already happening.

Sam Altman: My worst fears are that we caused significant-- We, the field, the technology, the industry cause significant harm to the world.

Micah Loewinger: Here's Sam Altman, CEO of OpenAI, testifying before Congress last May, and discussing why he thinks AI needs to be regulated.

Sam Altman: I think if this technology goes wrong, it can go quite wrong. We want to be vocal about that. We want to work with the government to prevent that from happening.

Micah Loewinger: Just a month later, Time Magazine revealed that OpenAI had secretly lobbied the EU to go easy on the company when regulators were drafting what's now the largest set of AI guardrails.

Paris Marx: Because he is treated as the high priest of this AI moment because he had these compelling narratives that were being backed up by a lot of reporting.

Micah Loewinger: Paris Marx.

Paris Marx: He was basically able to convince European Union officials to reduce the regulations on his company and his types of products specifically, and that carried through to when the AI Act was finally passed.

Micah Loewinger: All this while technology companies push the public along a path that they and members of the press say is inevitable.

Paris Marx: We know that generative AI, the ChatGPTs, the image generators, things like that, are much more computationally intensive than the types of tools that we were using previously, so they require a lot more computing power. As a result of that, Amazon and Microsoft and Google are in the process of doing a major build-out of large hyperscale data centers around the world in order to power what they hope will be this major demand for these generative AI tools into the future. That obviously requires a lot of energy and a lot of water to power it.

Sam Altman: I think we have paths now to a massive energy transition away from burning carbon.

Paris Marx: In this interview in January with Bloomberg, Altman, actually directly engaged with that when he was asked about it.

Interviewer: Does this frighten you guys because the world hasn't been that versatile when it comes to supply, but AI, as you have pointed out, it's not going to take its time until we start generating enough power?

Sam Altman: It motivates us to go invest more in fusion and invest more in new storage.

Paris Marx: He said that we're actually going to need an energy breakthrough in nuclear technologies in order to power the vision of AI that he has. He didn't hesitate and say, well, if we don't arrive at it, then maybe we won't be able to roll out this vision of AI that I hope to see, but rather that we're just going to have to power it with other energy sources, those often being fossil energy sources, and that would require us to geoengineer the planet in order to keep it cooler than it would otherwise be because of all the emissions that we're creating.

Julia Angwin: The existential question I have about AI is, is it worth it?

Micah Loewinger: Julia Angwin.

Julia Angwin: Is it worth having something that maybe sorts data or writes an email for you at the cost of our extremely precious energy? Then also, AI is based on scooping up all this data from the public internet without consent.

Micah Loewinger: As Sam Barnett said, speed is imperative. It's why big tech is pushing some half-baked AI features. As of last week, when you type a question into Google, you now see an AI-generated answer. Some people reported that the AI told them to eat rocks and put glue on pizza, which weren't presented as jokes, even though the info appears to have been scraped from Reddit and The Onion.

Julia Angwin: There's this AI pioneer Yann LeCun, who works at Meta. He's their leading AI scientist. He recently tweeted out something I thought was so perfect. He said, "It will take years for AI to get as smart as cats."

[laughter]

I felt like that's perfect. I should have just run that instead of my column.

Micah Loewinger: Here's one last issue. When Google AI summarizes legit info from real news sites, there's no need to go to the original source, meaning even less traffic for ailing media organizations. This is yet another reason members of the press should refrain from Silicon Valley boosterism. Janky new tools may be eating our lunch, but if the recipe was made by AI, we should probably wait to dig in.

[music]

That's it for this week's show. On the Media is produced by Eloise Blondiau, Molly Rosen, Rebecca Clark-Callender, and Candice Wang. Our technical director is Jennifer Munson. Our engineer is Brendan Dalton. Katya Rogers is our executive producer. On the Media is a production of WNYC Studios. I'm Micah Loewinger.

 

 

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