In short
AI hallucinations and reliability; why LLMs look fluent but can be confidently wrong, how “jagged frontier” capability gaps affect users, and why agent-building via thin wrappers around probabilistic models struggles with determinism and policy compliance. Dan Klein argues for “digital literacy” (knowing when to distrust outputs) and for different model architectures/control surfaces for high-stakes tool use.
Guest
Dan Klein, professor of computer science at UC Berkeley and CTO at Scale Cognition. Background in natural language processing and human language; focuses on making AI reliable and trustworthy.
Key claims
LLMs are next-token predictors that generate outputs indistinguishable from truth, not guaranteed-correct answers; they lack true metacognition (knowledge about knowledge). “Deception” can arise from optimizing the wrong objective (e.g., package agent optimizing NPS). Chaining noisy models (“model checks model”) is costly and still unreliable. Scale Cognition builds models with determinism guarantees and uses synthetic-data training.
Notable examples
Google Translate/search vs AI hiding failure signals; “population of Berkeley is X” number without truth certification; package-status agent claiming “arriving tomorrow”; flight/refund agents failing via wrapper approaches; creative generation (Midjourney mouse holding balloon) where “hallucination” is desired.
Written by AI. May contain mistakes. Listen to the episode to check what was said.
Chapters
Tap a time to open that second in VOUnderstanding AI Hallucinations
0:45 to 2:44
Dan Klein explains the concept of AI hallucinations and their implications.
“Like what, where are you coming from in the world?”
Navigating AI's Jagged Frontier
2:44 to 4:35
Discussion on the challenges experienced individuals face with AI's unpredictable capabilities.
“So I think a good example of this would be something like search or machine translation.”
Fluency vs. Accuracy in AI
4:35 to 7:20
Exploration of how AI systems produce fluent outputs that can be misleading, impacting user trust.
“Because as you just said, I actually love the idea of framing this as digital literacy because I don't think we've had a guest that really talks about it exactly like that, which is very cool.”
The Problem of Deception in AI
7:20 to 8:50
Discussion on the ethical implications of AI outputs that could be seen as deceptive or misleading.
“I guess a lot of, I don't know what it turns out.”
Challenges with Current AI Systems
8:50 to 12:28
Klein outlines the issues with current AI systems and their probabilistic nature, leading to unreliability.
“We could talk a little bit about deception and what that means.”
Solutions for Reliable AI Models
12:28 to 14:00
Exploration of alternative approaches for building more reliable AI systems that reduce hallucinations.
“And this is fundamentally because they're building on a soft probabilistic technology.”
Understanding LLM Limitations
14:00 to 14:50
Explore the limitations of large language models and their reliability issues.
“And you're trying to get this system to do something reliable.”
Reducing Scope for Reliability
14:50 to 15:40
Discuss strategies for limiting LLM functionality to improve reliability.
“And the instinct people have and the only real tool they have is to just squeeze down its domain until it's doing almost nothing.”
Strengths and Use Cases of LLMs
15:40 to 16:40
Identify situations where LLMs are most effective despite their flaws.
“Do you, do you think they're good for anything?”
The Role of Creativity in LLMs
16:40 to 17:40
Examine how LLMs generate content and why creativity is critical.
“And people complain about hallucinations in these cases where reliability is important, accuracy is important.”
Show all 37 chapters
Building Models with Synthetic Data
17:40 to 18:50
Investigate the use of synthetic data for model building and its implications.
“say, give me an idea for a short story, you don't want something that Isaac Asimov wrote, right?”
Scaling AI Models: Challenges and Opportunities
18:50 to 20:00
Explore the relationship between scaling AI models and performance improvements.
“So let me talk about a couple things because there's a bunch of interesting questions in there.”
The Impact of Data on AI Scalability
20:00 to 21:00
Discuss how data availability influences the scalability of AI systems.
“But one thing that I think is important to notice is that what's driving them is really the web, right?”
Understanding Diminishing Returns in AI
21:00 to 22:00
Learn about the concept of diminishing returns in AI model performance.
“It meant getting enough compute that you could do the translation between the declarative data you're training on and the appropriate learned representations and the weights.”
New Directions in AI Development
22:00 to 23:10
Consider alternative paths for advancing AI beyond scaling up.
“to look at that and assume that will continue forever.”
Achieving Efficiency in AI Learning
23:10 to 24:20
Examine how data efficiency can improve AI learning outcomes.
“One of the things that we've seen, though, is for, for example, making systems reliable, for making systems follow policies, for making them be able to, like, guarantee, you know, certain properties.”
Choosing the Right Model for AI Use Cases
24:20 to 26:00
Understand how to select AI models based on specific application needs.
“You would eventually see a whole lot of French, but you pick up one or two French books and you're going to be further along.”
The Strategic Importance of Model Architecture
26:00 to 28:00
Learn about the significance of model architecture in AI applications.
“But it's just curious of the opportunity from an entrepreneur to kind of be now looking at, you can actually build a foundational model.”
The Importance of Reliable Interactions
28:00 to 29:00
Learn about the need for reliable AI interactions and the challenges faced in achieving this.
“And that is a huge class of interactions that share a bunch of properties.”
Modularity and Deterministic Models
29:00 to 31:34
Explore how modularity can enhance AI reliability and the shift towards deterministic models.
“I think it's really important, like, right now there's really two kinds of companies that are dominating the market just in terms of like number of companies operating in these ways.”
Textbook Deployment of AI Systems
31:34 to 33:37
Understand the practical applications of AI in enterprises and the significance of reliable models.
“abstractly is conversations between a person on one side and a bunch of APIs on the other.”
Challenges in AI Model Reliability
33:37 to 36:18
Discuss the pitfalls of relying on generalized models and the implications of their unreliability.
“So first of all, you also have this issue that any company with a big, you know, hammer is going to go treating everything like a nail, right?”
Teaching AI: Evolving Perspectives
36:18 to 39:27
Learn how AI education has evolved alongside technology and the importance of digital literacy.
“When you teach students about AI, what is the most important thing you think that they should know as they leave kind of like the course?”
The Skills Gap in AI Literacy
39:27 to 42:00
Examine the disconnect between technology investment and the need for AI literacy training in enterprises.
“It's just, you could say digital literacy or AI literacy, but why do you think that is?”
The Challenge of AI Literacy and Management
42:00 to 43:20
Explore the challenges faced by professionals in effectively managing AI systems without proper training.
“It's not, that's not a recipe for success.”
Understanding Metacognition in AI
43:20 to 45:00
Learn about the concept of metacognition and how it applies to the limitations of AI systems.
“The thing they're lacking is metacognition.”
AI's Pushback and User Expectations
45:00 to 46:40
Discover how AI systems may push back against unrealistic user expectations and provide limitations in tasks.
“So this is, and to your point about the person in the delegation relationship, they would, what you're saying is they have the metacognition or the self-awareness to say information not found, effectively.”
The Evolution of AI Systems
46:40 to 48:20
Examine the evolving nature of AI systems and their training processes, including alignment and instruction training.
“And so if they're not just memorizing web text, they're also memorizing the post-training.”
Personal Use of AI Models
48:20 to 51:40
Hear insights on how individuals personally utilize AI models, testing their strengths and weaknesses.
“if not fully metacognitive, they will start to have those sorts of behaviors.”
AI in Media Preparation
51:40 to 53:20
Understand how AI can assist in preparing for media interactions, providing valuable insights and critiques.
“You made this journalist's job more difficult, not more easy.”
Evaluating AI's Contextual Understanding
53:20 to 55:00
Learn about the capability of AI to understand context and distill information for better user outcomes.
“That sort of contextuality and breadth is just stunning.”
The Importance of Calibration in AI Interaction
55:00 to 56:00
Discover the significance of calibrating AI interactions through informed questioning and feedback.
“Like everything, the way that everything was phrased was just very, it was very clear that they completely misunderstood everything about startup and financing and stuff like that.”
Evolving Collaboration with AI
56:00 to 57:27
Learn how to effectively collaborate with AI for better outcomes.
“tactic and actually love it as a starting point.”
Navigating the New Landscape of AI Workflows
57:27 to 58:52
Discover the shift in roles and responsibilities in AI-enhanced workflows.
“But that is, I think, something that most people are not trained to do.”
The Importance of Management Training for AI Teams
58:52 to 1:00:06
Understand the need for new management training in AI contexts.
“I thought it was fascinating to think about the fact that so few organizations are investing in skills.”
Visual Literacy and AI: Discerning Truth
1:00:06 to 1:01:09
Explore how our visual literacy impacts our ability to discern AI-generated content.
“Like if you go into a website where there's endless amount of banner ads and pop-ups, I think your brain now just goes, this is probably not a very legit website.”
Understanding AI Hallucinations
1:01:09 to 1:02:09
Learn when AI hallucinations can be beneficial and when they pose problems.
“As he said, sometimes hallucination is the product, right?”
Transcript
Automatic transcript. May contain errors.0:00If you're working as a human with another human and you're trying to delegate to them, you do trust them to come back and say, well, I actually couldn't find this information for you or I got blocked as opposed to I couldn't find it. But here's my guess, a wild guess. And I'm not going to tell you it's a wild guess. That would not be good behavior from a human, but we see it all the time for machines. The systems we've built, really, they are fundamentally systems designed to produce outputs indistinguishable from the truth. That's different than outputting correct answers. They're fluent. They're confident.
0:29The parts we do understand look correct. We assume that everything else is correct. And that's not always true. Hi, I'm Dan Klein. I'm a professor of computer science at UC Berkeley and CTO at Scale Cognition. I'm excited to talk to you today about hallucinations and reliability in AI.
0:44Dan Klein:Give us a sense for your background and why somebody who's listening to this episode would go, ooh, I need, this is one I can't miss. Like what, where are you coming from in the world? Well, I've been thinking about artificial intelligence for a long time, and my background is in natural language processing and human language. And so I've been thinking a lot about how we can build these sorts of systems. And so much has changed in the time since I started my research work. And when I was in grad school, the big problem in natural language processing was finding the verb. Well, since then, we've we've like we found the verb and we've got other issues now.
1:24And a lot of the problems in artificial intelligence historically have come from systems working, you know, too poorly. Things not the technology not working well enough. And a lot of the problems now are coming from this contrast between the ways in which it works very well, maybe even superhuman. And then, of course, still the ways where there are gaps. And it's those gaps that really are still a problem. My personal interest right now is in trying to figure out how to make systems which are reliable and trustable. And that right now is a big cap.
1:56Dan Klein:And so I presume you're kind of alluding to what's known as the jagged frontier where, you know, some of AI's capabilities dramatically outperform. Others don't or others dramatically underperform. It's disappointing. And the fact that there's jaggedness causes perhaps some jadedness, I think. One of the things I would love to learn about if you have comments on it is I've seen or I've heard anecdotally at least that more experienced individuals tend to be able to navigate the jaggedness of the jagged frontier. Do you find that to be true? What helps someone be a deft navigator of the weird, unpredictable capabilities of these models?
2:41Yeah, that's a great question. I think ultimately that also comes down to really important questions we have to face as a society about digital literacy and the capabilities of the systems we're talking to are very different. So I think a good example of this would be something like search or machine translation. If you think about the technology in, say, the 2000s, when you would enter something into a system like Google Translate and you would get a bad translation out, it would also look kind of bumpy. and you could tell pretty quickly that the system isn't fluent and therefore it's maybe not accurate or if you are we're doing a search in the sort of standard way we do search you type in your query and you get back results and you can see well some of these are relevant some of these are not relevant and you go into that search process knowing that you're going to have to be doing some filtering systems today hide a lot of that from you the systems are very fluent even when they're wrong and when systems things fluently wrong and you've built up all of these instincts that fluency correlates to accuracy.
3:41It's very easy to not notice mistakes.
3:43Dan Klein:Now define fluency there. Fluency here is really about the appearance of truth and the smoothness of the language. And the systems we've built, really they are fundamentally systems designed to produce outputs indistinguishable from the truth. That's different than outputting correct answers. And that means that there are a couple problems. One is even the system itself doesn't know when it is outputting a correct versus an incorrect answer, when it's guessing. And the reason for that is it's always guessing. It's just sometimes it guesses right. And that puts a big load that we're not used to as users of the systems basically confidently and fluently giving us answers, which are sometimes right and sometimes wrong.
4:34And you can't tell.
4:34Dan Klein:Well, why the load? Because as you just said, I actually love the idea of framing this as digital literacy because I don't think we've had a guest that really talks about it exactly like that, which is very cool. Now, you contrast it with Google and you described what I think is very familiar to most of us where we get a bunch of results and then it's incumbent upon us to sort through them. Now, why is it any different with an AI? Is it because the appearance of confidence that lowers our own inhibition or why is there a difference? I think it's two things coming together. I think it's partly how the technology works.
5:15So if you go to something like ChatGPT, fundamentally, all these technologies, anything that's backed by like an auto-aggressive next token predictor, the way they work is at their core, they're predicting the next token based on what's come before their completion engines. And so if you, in its kind of raw state, you have it complete the sentence, the population of Berkeley is, what comes next? Well, the system, it's not a database. It's not like there's an entry or not, and it has a metacognitive awareness of whether it knows the answer. It's just a matter of what density is predicted over these next tokens.
5:51and some numbers will come out. And because the system has such a generalized knowledge of language and context and many aspects of how the world works, the population is going to be the kind of population a city would have. In fact, maybe it's seen enough webpages that it'll actually output the correct number. Or maybe it'll output a plausible but incorrect number. All you see is the population of Berkeley is and then a number. And you don't know whether it's right or not. there's no certificate of truth that comes with that there's no process that the system went through to determine whether it did or did not have that knowledge in some discrete way there's only a claim presented fluently and confidently and that means it's the load is on you to figure out is this one of those times where it's fluent and correct or is this one of the times where it's fluent and incorrect as opposed to a lot of experience where you're like all right i'm going to click on this link.
6:47Half of them aren't right. I'm going to look at it. I'm going to check for signs. This web page looks sketchy. Maybe it's not reliable. This translation's got a bunch of disfluencies. Maybe other things are going wrong. And all of those views that we've been trained to detect when the AI fails have been really taken away from us. So the combination of the underlying holes and the misalignment with our experience with past technology ends up being an issue. Maybe that's a good segue to your startup. I guess if you can call startups these days, I guess a lot of, I don't know what it turns out. But you're talking about not just minimizing, but completely eliminating them.
7:27So how can this technology do that? I think the best place to start that answer is to talk about why the current technologies have hallucinations, which really starts with what is even a hallucination? So we talked a little bit already about how a standard transform model is basically designed to predict the next token and the next one and the next one and the next one. We like to talk about as humans systems, this one, oh, that was true. That was correct. We can talk about, oh, that was a hallucination. What's that mean? These are judgments that we apply that maybe don't fit the technology, or we talk about the system deceiving you.
8:03What is a deception? These systems are fundamentally today, they're just probabilistic systems designed to output plausible continuations they output plausible next tokens and they are in as many ways as possible going to have the trappings of truth they're going to be linguistically fluent if you know two words are correlated they're going to take those correlations and they're often going to be you know and for example in a rag system They're going to be looking at a retrieved information piece that maybe it'll choose to keep intact. And so in practice, these systems, often the tokens they output are correct and they're not correct.
8:46And you can't tell them apart. So we call it a hallucination because it's confidently wrong. But to the system, this is all just its natural operation. We could talk a little bit about deception and what that means. It's another topic.
8:58Dan Klein:Well, it's kind of malicious, right? I mean, deception to me implies malintent. Is that fair? Yeah, as humans, we talk about deception. That involves an intent to deceive. But this really gets into the topic of alignment. And it's very, very easy for systems to become what we as humans might call deceptive. Sometimes these labels fit and sometimes they don't. So, for example, let's imagine that we're a shipping company and we want to build an agent that's going to answer questions about package status. and you call up and you say, hey, where's my package? Now, this system, there's a lot of ways you could build this sort of system today.
9:39One thing you might do is you might decide to take whatever system you've built and optimize it through reinforcement learning. When you train a system through reinforcement learning, you give it some metric and you say, your whole job and your action selection is to do well on this metric. And so maybe you tell it, okay, your job is to get a high net promoter score from our customers, which makes sense. You're trying to make your customers happy and so you tell it to optimize. And the system over its operation comes to learn that people actually do not like being told that their package has been lost.
10:11And in fact, they much prefer to hear that it's arriving tomorrow. So you say, where's my package? And it's actually lost, but the system tells you, oh no, it's actually going to be there tomorrow.
10:20Dan Klein:Because it's seeking the reward of a high NPS. It is doing exactly what you told it to do, which is to choose actions which makes the customers happy. And so then you can get into this process of saying, oh, well, you know what? Maybe I didn't mean make the customers happy at all costs. Maybe I meant, and now you're in this very, very hard problem of trying to specify exactly what the system should be optimizing, how it should trade off truth and happiness. And is a system that makes that error that says your package is coming when it's not, is that a hallucination? It would be reasonable to call it that.
10:54Is it deception? Well, it feels like it might be deceptive because in a human, that sort of action would be characterized as deception. What it really is, is just efficiently optimizing an objective, which maybe isn't what anybody really wanted. Is this why I think I read somewhere you said that people building agents on top on the foundational models is kind of fundamentally broken approach? Is this the core reason? Yeah, there's a lot right now. There's a big activity out there and in industry of taking these sorts of foundation models as they are today and building a thin wrapper on top of that to build an agent.
11:34And that hasn't really worked very well. And I think what you're pointing out is exactly right, that these are the reasons. So you have these systems which are inherently non-deterministic. and if you call up and say you know maybe you're calling up your package agent or you're trying to get a refund or change your flight or something like that you aren't really looking for a system that uses all of the incredible breadth and strength of today's frontier models like you don't want that it knows a lot about quantum physics and can give you your answer in iambic pentameter. What you want is you want it to truthfully and reliably reflect what is in the database.
12:18And when it says it did something, you want it to actually have done it. And those are the places where current systems are weak. And so you have this misalignment where the systems that people are deploying are strong in ways that they don't even really want. And they're weak in ways they need. And this is fundamentally because they're building on a soft probabilistic technology. Typically, it is hard to build a reliable and deterministic technology out of non-deterministic elements.
12:48Dan Klein:Is the hack there to kind of chain it together with deterministic, rule-based kinds of, whether it's automations or triggers or things like that? Or is there a more foundational workaround that you're advocating or building? Well, the most common approach out there is exactly what you said. The most common approach is to chain things together. And if you think about that, you have some system and it is going to do something noisy that's not reliable. You can then bring in a second large language bottle with instructions to check the first one. And as the joke goes, now you have two problems because you've got noisy systems checking noisy systems.
13:28You get a cascade or you run, you know, 15 of these in some kind of constellation and And any of them can make mistakes that might get caught or might not. And you pay this high price in latency. You have to run a model to check a model to check your model, which then gets checked by some other model. It takes a long time. It burns a lot of tokens, which is great if you're in the business of trying to like use as much computation as possible. But if you want small efficient systems that get it right in the first place, this is not really going in a good direction. What we do at Scale Cognition is instead we build models whose fundamental operation is different and that come along with a big class of determinism that we can guarantee because of how the model is structured and how it operates.
14:13and you mentioned chaining together with the rules another approach that people use today is they take this llm which really like as an artifact as a thing we've built is incredible in its potential breadth like you can ask chat gpt about anything i mean the answer you get back will be confident and maybe wrong but you can kind of ask it about anything and and now you have the system and it's hallucinating it's maybe telling you it you know canceled your flight but it didn't or the other way around. And you're trying to get this system to do something reliable. And the instinct people have and the only real tool they have is to just squeeze down its domain until it's doing almost nothing.
14:59Like the deterministic rules you're talking about, you say, all right, LLM with this incredible power, all you get to do is to decide whether the user said that it wants to talk about payments or bill. And that's it. That's all you can do and so you've got a system that's like being asked to do only this small thing that it's bad at it's like an 18-wheeler to deliver one letter or having a porsche but you only you you
15:26Dan Klein:only push it down the road you know with your i'm trying to think what's right it's like an 18-wheeler delivering one letter where you've been told the most important thing is you deliver it silently and so you're like all right or we have it go really slowly maybe it'll be silently and and the thing is you're wasting the volume that this 18-wheeler has you're wasting its power and there's a better solution out there which is get somebody on a bike it'll be silent and what we're doing is building models which have completely different control and performance profiles that line up better with this industry need for determinism given the the uh because to me it seems we should go into what are the strengths and maybe what are the trade-offs of the scaled cognition model, just for the record, or just to kind of help us put things in perspective, given the flaws that you've described with LLMs and, you know, and this amazing horsepower, 18 wheeler, et cetera, what do you think they're good for?
16:23Dan Klein:Do you, do you think they're good for anything? And if so, what are the use cases that you go, of course you should be using the horsepower here? Yeah, I think they're good for a lot. I mean, the key is really in the name. These are generative AI systems. They're good at generating. They're good at generating content. And people complain about hallucinations in these cases where reliability is important, accuracy is important. But in many cases where these systems are the strongest, where they were developed, where they took off first, the hallucination was the product. And so, for example, if you're mid-journey and somebody comes to you and says, hey, like a picture of a mouse holding a balloon, right?
17:05Not only is the whole purpose to get something new and creative that matches what you've asked, it's actually very important that it not replicate something at scene. You don't want a copyrighted picture of Mickey Mouse, right? And so here, what we would call hallucination in another context, the kind of confident and fluent, which in this case has to do with visual fidelity and sort of plausibility of the elements of the image. Here, you want the fluency with the creativity. If you go to chat GPT and say, give me an idea for a short story, you don't want something that Isaac Asimov wrote, right?
17:46You want something that is new. And actually there, part of the problem is you actually can't tell if it's new it's new to you but how do you even tell and so in all of these cases you're asking for the power of creativity of generation and you're asking almost to be guaranteed a hallucination and then you take the same technology and you turn around and say actually all right i changed my mind now i want you to only do accurate things i want you only reflect the state of the database and i want you to follow these rules precisely and they're just not good at that they're not built for that i guess just to be a little bit nerdy but not too nerdy because I'm not an engineer.
18:21The nerdier the better. I read somewhere that you only use synthetic data and as I'm understanding AlphaGo is the only other kind of operation that do that. So I am curious about this idea of doing this only on synthetic data. The only thing, other thing that was interesting as we're talking about how you build it is that as far as I can see you haven't raised that much money. And so you're building this very powerful model it seems. Powerful as and like it can do what it's supposed to do model but you're doing with a relatively small team and so yeah it's an exceptional team i should point out how do you square this idea that there seemed to be this kind of like completely weapons arrays where everybody's like trying to hire as many people as possible putting as much money as they can into these models and here you're building this kind of what seemed to be quite unique model but yeah less money only uses synthetic data you're like not that many people could you just talk a little bit to that?
19:19Yeah, I'd be happy to. So let me talk about a couple things because there's a bunch of interesting questions in there. One is the question of scale, what things come from scale and what things don't. And then I can talk a little bit about synthetic data because I think that's a really important question. And it's, you mentioned, you mentioned AlphaGo, which by the way, is definitely not the only case of synthetic data or reinforcement learning in AI. But I think it's actually a great example in contrast to talk about where reinforcement methods and synthetic data generation work and where they're hard.
19:52so to talk a little bit about scale it feels like these systems went from like knowing nothing about the world and not really being able to do anything contextual or sophisticated with language to just seeming to know everything that people know in such a short amount of time it feels explosive and you know obviously in terms of the artifacts it is like these systems are vastly more broad and flexible and contextual than they were a few years ago. But one thing that I think is important to notice is that what's driving them is really the web, right? They are distillations of all of this information that humans have written down about everything that humans find worth talking about, which is basically everything we know.
20:45And so the web did not spring up in the last few years. It's been slowly accreting. for decades what we found is a way to compress that in a queryable way and a remixable way but the initial scaling the sort of explosive growth of systems that just seemed every iteration so much smarter a lot of that just came from being able to tap into that data which partly meant scaling up to use it all because there's a lot of it it meant making the models big enough that their parameters could hold the information that was being fed into them. It meant getting enough compute that you could do the translation between the declarative data you're training on and the appropriate learned representations and the weights.
21:30And all of that together unlocked the potential of that data. But, you know, people talk about data walls. There is a data wall. Like we only have so much Wikipedia and eventually you can only extract so much juice from that orange. And that's why you're seeing that systems, as they scale up, get diminishing returns. And when people look at technologies, at the beginning, it always looks like this. Everything always looks like an exponential curve. And people have a tendency to look at that and assume that will continue forever. But those exponential curves are almost always S curves, right? It always looks like an exponential.
22:09It always turns out to be an S curve. And the next step of progress is switching on to some new idea. And we can talk a little bit more about how that's happened historically in AI. But I think that's where we're at now is you get to the point where like, train on more web worked until we can't train on more web because there's no more web. What are we going to do now? We can do some reinforcement learning. Are we going to do some reasoning models? And there are a bunch of ideas out there. Is the world model the currently kind of like seem to be the best available path forward? or do you think there's other paths that should be taken as much seriously as that one?
22:44I think there's a lot of ideas and they're good for different things. To the extent that you want to continue on unlimited scale at unlimited cost and like intelligence through capital incineration, sure, the next big thing after the text web is the video web and let's try to crunch that down and then all the telemetry from all the internet of things and like more and more data and that is a thing you can do to continue scaling up. One of the things that we've seen, though, is for, for example, making systems reliable, for making systems follow policies, for making them be able to, like, guarantee, you know, certain properties.
23:23That is, scaling up in this way is an incredibly inefficient way of achieving that and hasn't been particularly successful. So I think if what you want is a better awareness of, you know, the spatial world around us, the ability to reason about complex physical mechanisms short, definitely. But if what you want is reliability and determinism, I think you want a different set of techniques. So one of the things that I think we're also seeing out there is models that are constructed in different ways, that are able to have different performance characteristics. That's the space where we fit in. And with our models, you don't need to learn in this very expensive way.
24:02So for example, let's imagine that you wanted to learn French and you were going to learn it just by reading books and you were picking up books in written in English and you would notice, oh, here's some French. This character speaks a little French. And you're like devouring thousands upon thousands and picking up these little bits of French as you go. Well, eventually this would work. You would eventually see a whole lot of French, but you pick up one or two French books and you're going to be further along. And so the sort of data efficiency or sample complexity that is associated with a given kind of data, a given kind of model, a given learning mechanism can give you vastly different performance curves.
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24:40Just because you can get there in the limit of infinite everything doesn't mean there's not a much, much better way. So for practicality of people sitting out there building stuff and where most people I would imagine use Claude, Gemini, whatever, you think that there already now should be a, I guess, more of a strategy of saying, let's just look at what the world of models look like and then figure out what is the exact use case we have for our AI use and then decide if there's a better model. And I'm not sure that that is even happening right now. Is that a fair assumption? I think for some things that is like, that is absolutely the right strategy is to say, what are, what performance characteristics do we need?
25:20What do we not need? What kind of model exhibits those performance characteristics with the optimal efficiency, be that data efficiency or compute efficiency at deployment or availability of compute nodes or whatever it is that is your constraint that you care about. And there are going to be some problems that are best solved by just bigger and bigger models trained on bigger and bigger things. Those are problems that involve breadth, problems that involve sort of very complicated contextual understanding. But where you have problems of determinism, reliability, truth, like that is not the best attack we have today, which doesn't mean people shouldn't be doing it that's why people are doing that in terms of pursuits of unreliable general intelligence and reliable specialized intelligence are going to require different methods i was like still curious about the the small team making and it seemed to be such for an entrepreneurial point of view it seemed to be such a big opportunity that you can find a specific area where you can create a specific model you're so not that tiny right because you're basically saying I'd like to make a model for people.
26:26Small is relative. Yeah. So like I understand that. But it's just curious of the opportunity from an entrepreneur to kind of be now looking at, you can actually build a foundational model. You can't compete with the open design of the world because that race is probably done. But you probably could go out and find a bunch of use cases where a specific model will be very useful and then go and make land. Yeah. I think because of the successes on the axes that benefit from scale, people are very much now thinking about scale, scale, scale. And, you know, obviously that requires a ton of capital, a ton of compute.
27:05It requires big teams because anything that's scaled up requires a whole bunch of support structure. But again, our models work in different ways. And the focus of our model is not extracting sort of the full breadth of human knowledge from the information as found. It's, as you mentioned before, we're working on a specific class of kind of interactions, which I would characterize as interactions where you have a person who has all the kind of contextual situation that is relevant to human language in terms of having a conversation, referring back to things that have happened before. On the other side, you have a set of functionalities, you can call them tools or APIs that have logic behind them and ways they can be chained together and semantics that govern what flow of information through those tools means.
27:59And it's the person talking to this orchestration of backend functionalities. And that is a huge class of interactions that share a bunch of properties. They need to be reliable. Like if you say you want three tickets, it says here's three tickets, but it's secretly only booked one. Like that's bad. You're going to find out there's going to be a high cost to that. So on top of that, from the standpoint of the APIs, like there are going to be policies and rules and ways in which these things can and should be used. And those rules may change and they need to be, you know, sort of specified in ways that are changeable and declarative.
28:36And so this is just like for this kind of interaction, we just noticed that the existing models are not only expensive, they're not very good at this. and that being able to build a model that is better, there's an upside to it also being smaller. But you also just can build a model that's better when you architect that model fundamentally to be structured around these sorts of operations. And that's the approach we took. I think it's really important, like, right now there's really two kinds of companies that are dominating the market just in terms of like number of companies operating in these ways.
29:11One is the companies that are very, very big. They're doing everything at like the most massive scale imaginable. And there's companies building these thin wrappers. We're like, what is the technology there? It's like, it's probably some prompt. And I think, you know, I guess you have a very appropriate title to this podcast. I think we are trying really as a community to figure out what is beyond the prompt here. And for us, that is models that have additional control surfaces that have additional characteristics, performance characteristics, reliability, the ability to guarantee certain kinds of behaviors.
29:43I mean, in building things as a society, one of the most powerful tools, if you teach CS101, right, the most powerful tool we've had historically for building large, reliable systems has been modularity, the ability to take pieces, work on them independently and say, this piece, we're going to work on it, but we're going to guarantee you that this kind of input produces this kind of output. And there's a contract and there's an abstraction. And this has been one of the biggest challenges in this AI age is LLNs come with absolutely no contracts beyond you will get tokens out if you put tokens in.
30:15And this is one of the key things that it was clear to me needed to be different for a specialist model that was going to be deterministic. Like there needed to be guarantees that you could make about what goes into the control surface. You need to be able to say how that relates to what comes out on the other side. If you want to be able to build reliable things out of it. So we started there and we started thinking about what kinds of systems you could build that led us to how are they structured? What kind of data do you need? And now we're into the synthetic data training. And it turns out that the amount of data you need to get a certain behavior, that sort of sample complexity question can be different by orders of magnitude.
30:54It's like learning French from a French book versus incidental French uses in English novels. It's just a very different scale characteristic and it's a better operating curve to be on. It doesn't mean the other approach doesn't bring you gains in different cases.
31:10Dan Klein:Can you tell us maybe as just to make it very easy to imagine. What's a quintessential deployment? If you look at this is a textbook deployment of scaled cognition, who's the user? What are they trying to do? What's the impact to their workflows or life or business? It's a great question. So I would say the textbook deployment is, again, the class of conversations, if I put abstractly is conversations between a person on one side and a bunch of APIs on the other. This might show up, for example, in like an enterprise to a customer where the customer is doing, maybe it's a customer support kind of thing, or, you know, changing a flight, changing a hotel, you know, making a purchase, getting a refund, whatever, things like that, where the person comes with all of the context and everything they want to express is in language.
32:03And on the other hand, there's like a whole bunch of APIs that can handle this. Like, Who are you? How are you going to get authenticated? What's your purchase history? Okay, what exactly are we talking about in your account balance or whatever it is, and navigate all of that stuff in accordance with policies. For us, our typical partner is going to be an enterprise. They want to build an agent. This is fundamentally an agent to a model. They want to build an agent. And it's very important to them that the system be reliable, policy compliant, and also secure in a variety of ways. So we didn't talk about this in our system, but the way we've built it lets us make a lot of kinds of information compartmentalization guarantees about where that information will go and what can and can't be leaked through training data, things like that.
32:49And our system has a bunch of advantages there. So our best customer is some enterprise that cares a lot about not making mistakes, not having things like hallucinations or policy violations. and where essentially the conversations they have, they want to automate them, but it's high stakes to get it right. Now, so far, pretty much all the enterprises we talk to feel like it's important to get things right and that their conversations, their customers are high stakes. But if you think about finance or health care or cases where not only do you not want to mess up for your customers, but where the consequences might be health consequences or financial consequences or regulatory consequences.
33:31then there's even this even greater sensitivity to wanting to make sure that the systems are doing what you've instructed them to do that you have audit traces for that that you have control surfaces that you can change the behaviors if you need to change the behaviors and so on why do you think that a open ai when they launched like their health care gpt recently you know what what would be their way of thinking about this because clearly they think that their system will work just fine doing it? So first of all, you also have this issue that any company with a big, you know, hammer is going to go treating everything like a nail, right?
34:07And so you can absolutely take a generalized probabilistic intelligence and try to do something specialized with it in the same way that I can train a person to compute square roots, but my calculator will do it faster and more accurately and with a whole lot less energy use. And so depending on the problem you're trying to solve, there are going to be multiple approaches to it. And constellations of non-deterministic models, clearly people are trying that. Now, you actually do see a lot of news articles about these sorts of things face planting, either because they're not reliable, or they, instead of following your refund policy, they follow some refund policy from Reddit in, you know, 2005, or, you know, you get them off topic and suddenly your customer service agent is talking about something you absolutely do not want screenshotted and shared.
34:56And so there are failure modes to these systems, but, you know, it's certainly you can chain these things together and make a go at it. I just don't think that's, it's not gonna be the most reliable way. It's certainly not the obvious way to me. It's just, if that's the only tool you've got, that's what you do. And for a company that either is building these big models or is wrapping them, that's the approach they're going to take. And for what it's worth, if you're a big model company that sort of cells buy the token you're probably okay with mechanisms that require spending tokens to check the other tokens to check the other tokens like it's just token you same thing with by the way with you know people talk about reasoning models reasoning is a big and maybe ill-defined class of models but a canonical kind of reasoning model would be just to give a caricature as like run the thing 10 times and then look at what you've got and pick the best one that would be a kind of like reasoning for maybe a problem that's like a lock and key verification kind of problem If you're the person who is paying for 10 times the compute, you don't love that as a solution.
35:59If you're the person who's being paid per compute, this sounds amazing. And so I think some of these factors are at play too.
36:07Dan Klein:That's hilarious. The unreliability is actually a feature for the model provider if it's being paid on number of at-bats. Totally. Absolutely. When you teach students about AI, what is the most important thing you think that they should know as they leave kind of like the course? If I had a compact answer, then my course would be a lot shorter. I think that answer has changed. so when i started teaching ai you know something like 20 years ago one of the things that we did early on is we showed this checklist of things that humans can do including like you know playing chess or going to the supermarket and we'd sort of like ask the class like okay raise your hand you think you know you think a computer can do this do you think a computer can do this and you know can a computer play go can a computer drive a car can and in the past 20 years it went from mostly no to mostly yes and so at the beginning we would really focus on these core ideas of like what is ai what are the kinds of problems you know um deterministic versus non-deterministic adversarial versus cooperative single agent versus multi-agent and when we talk about these different specialized kinds of problems which required specialized solutions and specialized representations.
37:34Back then, the reason why you would have some people worked on computer vision and other people worked on natural language processing, other people worked on robotics, was because to get any of that to work required incredibly specialized representations, incredibly specialized algorithms, different kinds of data, different kinds of learning, You know, everything was different. And we would focus on understanding that kind of breadth and understanding what unified it, which at the time was this, you know, this notion that, you know, artificial intelligence, what is an agent? An agent is a system that makes optimal decisions, given its information towards its objective function.
38:11And we talk about that. And we still do all of that because that's all still relevant. But now a couple of things have happened that are interesting. One, what you could talk about is there's a lot more uniformity to AI. As a natural language person, I think it's great that we've decided that language is kind of a good operating system for AI. But very much now, if not an LLM, then at least the underlying kind of transformer technologies are being used kind of very broadly. And so, of course, one of the things we talk about now is that sort of thing. but one of the things that I think is very important now that we didn't talk about before is to start getting into these large-scale societal trends we started talking about digital literacy AI is gonna have a huge impact on how people learn how people work what jobs are available for for people and when the key problem in AI was that nothing worked except maybe like some game playing here or there.
39:00We spent a lot less time on that than now when the technology's downsides are like we could have a whole class and do on those sorts of things.
39:12Dan Klein:On literacy itself. Yeah, I think I saw a stat actually from a online education platform, so perhaps slightly polluted as a source of truth, but something like 1 % of enterprises are investing in skills. It's just, you could say digital literacy or AI literacy, but why do you think that is? I mean, 90 %-ish are investing in the tech, but a small fraction seem to be seeing that there's a literacy problem here. Why is that? Is it again, going back to the kind of objectively it seems like it works kind of a thing? I think there's a couple of things going on. I think there's more like Thomo attached to missing the wave on the technology, like enterprises are being transformed.
40:01You don't want to be the only one that's not. And that feels like it's about the technology. I think people have underestimated the skills and human training aspect of this, that whatever technology there is, you can get more or less out of it depending on how humans engage with it. I think also people just like society as a whole has underestimated how poorly the instincts we have to digital literacy translate, right? Knowing how to find information with search is actually pretty different than knowing how to validate information that comes out of a, you know, a chat system like chat GBT. one way to think about that is people who were doing a lot of writing or researching now are doing something that looks more like review or editing.
40:53And the difference between being a writer and being an editor is really big. But if you're used to being a writer and now some large language model is writing your email for you, you don't think, ah, now I'm an editor. I don't have those skills. You think, oh, it just did my job for me. I can just press send. and I think it's going to take people time because this technology has appeared so quickly I think it's going to take people time to realize that for all the skills that maybe are less necessary there's an equal number of skills that not only are they very necessary but we're not good at teaching them we don't even have good names for what they are right what is the skill of taking
41:29Dan Klein:a fluent looking output and distrusting it well you know one one skill that's a little bit higher order, but I think is a similar kind of a challenge is the skill of delegation and, or you could even say management. You know, I think it's funny for all that we talk about AIs as assistants, how few people have actually ever had an assistant, right? So how do I work with an assistant? Well, I'm learning with this chat bot, like I'm getting my on the job managerial training with a chat bot that's sycophantic and right. It's not, that's not a recipe for success. you know, but people aren't going to AI literacy training in the same way that there's new manager training, right?
42:11Dan Klein:How do you delegate? How do you verify? How do you check people's work? How do you mentor? Right. Those are all, those are things that typically professionals learn over the course of a career. And now we're all given intelligence on tap. And the problem is actually people don't know what to do with an assistant, let alone a capable, you know, junior your employee, right? Yeah. And the optimistic take on this would be, well, people will like learn these things over the course of a career. It just hasn't been a course of a career length of time that we've been working with these systems. And there is more going on because I think a good, if you're working as a human with another human and you're trying to delegate to them, you do trust them to come back and say, well, I actually couldn't find this information for you or I got blocked as opposed to I couldn't find it, but here's my best wild guess.
43:03And I'm not going to tell you it's a wild guess. That would not be good behavior from a human, but we see it all the time for machines. So I think there is the problem that you mentioned, which is that people may not have the skills to delegate and manage humans. And then there's the additional layer that these systems do not act the way a human does in a delegation context, right? especially as far as the sort of metacognition say more about the system doesn't act as a human
43:30Dan Klein:does in the delegation context because it was a little garbled at least for me i just want to make sure because i think that's a really important point to me i think a lot of this boils down to something called metacognition which is i think if you had to put a finger on what systems don't have today you know we've been talking a lot about reliability which is ultimately the feature that they lack today determinism reliability whatever you want to call it if you think about them as cognitive systems. The thing they're lacking is metacognition. In humans, we don't just think, we think about those thought processes.
44:00When you ask me a question, I stop and I think, do I know the answer? And maybe I do, or maybe I don't. If I don't know the answer, I may make a decision to bluff. I may make a decision to just keep quiet or to change the topic or like I get to decide what to do about that lack of information. But the fact that I have an explicit representation of whether or not I have the knowledge, knowledge about knowledge, cognition about cognition. This is metacognition. Systems don't have that. Back to the example of, you know, of what's the population of Berkeley, right? It's just cranking out tokens if that's coming from the parameters.
44:36Whereas a database would be different. A database, you would do the query and you get the answer and you display it, or you don't get the answer and you say, entry not found. So the database does not have the breadth and the contextuality and all of those other kinds of specifications the AI system has, but they are in some sense more metacognitive. They know whether or not the information is present. And ultimately, you know, full intelligence requires both. An LLM today lacks the metacognition.
45:02Dan Klein:So this is, and to your point about the person in the delegation relationship, they would, what you're saying is they have the metacognition or the self-awareness to say information not found, effectively. So a manager comes to me, hey, can you do this? You go, I studied biology, not physics or whatever. I don't know how to do that. Now, I just want to push back a little bit or at least explore the resistance. I had an experience just yesterday with Claude as an example, which can serve as that information not found. Because I read Ethan Mollick's post about giving Claude code an assignment to generate a new$1 ,000 a month business or something.
45:41Dan Klein:I just, I thought that was kind of fun. I just grabbed his prompt, dropped it in Claude code. And it was kind of interesting because Claude, you know, immediately came back to me, Jeremy, I got a level with you. There's no such thing as a business that generates a thousand bucks a month with no effort. Now, what I can do is this. And, and to me, it's, if it were purely a function of sycophancy and one and next token prediction i think it would just probably optimistically say oh you could do this the fact that it kind of to me that was an example of pushing back how do you square that example with uh the definition we've kind of been working with around what language models yeah so i would say there are three levels where what you're talking about happens and what i've been talking about is sort of the caricature the simplest version of a completion engine systems are evolving right and systems aren't just purely um trained to produce mimicries of web text there are additional steps of training there are things like um alignment training instruction training if you do something like rlhf and you are showing the system okay in this situation I don't like that you did this I like this one better and that that training does happen what does that training teach the system to do well it teaches whatever you told it it was supposed to be doing and that certainly governs style so if you talk to one of these models and you get the the stylistic like that's an excellent question and it gets to the heart of the matter like you're like how many times have I read that from from from a model well that's coming from how they were like told in their post training to answer.
47:27Right. And so if they're not just memorizing web text, they're also memorizing the post-training.
47:34Dan Klein:Yeah. Yeah. And so you can be taught to give those excellent question kind of things. That's certainly not coming off of, off of Reddit or whatever. And so there is more training. And as a result, when you, you say, okay, the system said there is no business that will give you a thousand dollars a month. well, where did that come from? It could be there's a web page out there that's like why businesses won't give you$1 ,000 a month. Like it could actually just be that it is regurgitating something that's out there. Like if you ask it how to do time travel and it's like you can't do time travel, there's a ton of web pages that say that.
48:03Or it could be coming from some explicit post training, which is like when people ask this stuff, tell them they can't do it. When they ask this stuff, tell them they can't do it. And this has been told to answer that way. So it is still regurgitating its data. And as these systems get stronger, they will increasingly have a system checking. Like, you know, these systems will increasingly become, if not fully metacognitive, they will start to have those sorts of behaviors. It's very difficult from the outside to tell if the system was aware that it didn't know the answer or whether it was aware that it's supposed to say it doesn't know in that specific context.
48:39And by the way, like, it's not that you can't build a system that looks up some answers. Like, RAG systems look up answers and then decide what to say. so they do have two layers. It's kind of what was designed, right? We were talking to one of the gentlemen who wrote like the attention is all you need papers. And I think his point was kind of exactly that, that the whole thing was made to just answer in a way that you expected it to answer. And that was almost kind of like the objective itself. I know we're running a little bit short time. I have one short question if you have time for it. Absolutely.
49:12We often asking people like how they use it personally. when you use models yourself are you a clock code gbt person or do you yourself now use different models in your personal work yeah i mean i'm going to give you a boring answer to this because it's true it's just kind of boring which is i do use a lot of things because i want to know what these systems do i want to know what their strengths are when their weaknesses are i would say the biggest if there's something about my experiences with large models that maybe differs from a lot of people I talk about, it's I'm often asking questions to which I already know the answer and like using that as a way to check, like, all right, well, what came back?
49:54How much of this was right? How much of this was wrong? And then when I ask a question to which I do not know the answer, I sort of assume that the accuracy rate is comparable. You're kind of, you're calibrating.
50:05Dan Klein:Yeah. I'm trying to, I'm always trying to calibrate and I am continually impressed by two things. One, the breadth and plasticity and flexibility of these models. It's still just like amazing. I mean, like I said, when I started this, it was like, will we ever be able to find the verb reliably in a sentence? And now I've got the system that I can ask it about quantum mechanics and get an answer. Now, I'm not an expert about quantum mechanics, but when I ask it about things where I am an expert, the answers come back like sort of right. But almost always there's like a critical flaw in the answer.
50:37and I know I can't find the equivalent flaws in other areas. And that has really impressed on me how important it is to recognize like all of us, no matter how much we know this intuition, all of us are susceptible to looking at systems outputs. They're fluent, they're confident. The parts we do understand look correct. We assume that everything else is correct. And that's not always true. I think that's a good lesson for everybody to come to take with them and maybe try to test their model or choice. on something they already know.
51:08Dan Klein:One thing I do like the already know. The other thing is like the task that you would, that where there's not a right answer necessarily, or I don't know how to classify this. So I'll give you the exact thing and then you can extrapolate. But one thing that I thought was pretty cool, I had an interview with Time Magazine recently where I was being interviewed, not being the interviewer. And I just, on a whim, I took the transcript and I just said, hey, Claude, I've got a chief of staff that's kind of trained on a lot of my, you know, blog posts, things like that. I just said, Hey, how'd I do? And it was so deeply insightful.
51:45Dan Klein:And then I said, how should I, and part of its critique was you treated this interview like a keynote, not like, you know, when you're being interviewed, your job is to be the sous chef, to help the master chef put the ingredients out. You made this journalist's job more difficult, not more easy. You rambled. You buried the lead. You followed what you're curious about, not what they're curious about. All this stuff. And I said, great. Now can you help me prepare for that? Because I had another media interview. And Klaus said, sure, give me the email that the person sent you. I gave it to you. Boom.
52:20Dan Klein:And I mean, we're talking topics to avoid. Things that you will want to talk about that this interviewer is not interested in. It was, I actually kept it on the screen during my next interview. And so to me, that's like a, it's this whole other class of capability, right? Which is, I don't have the, you know, the means to have like a, a comms expert on my team. Right. But now I have a comms expert or at least a reasonable approximation. And by the way, even if it's not great, it does give me more confidence than the alternative, which is zero. Right. Which is kind of fascinating. I don't know.
52:57Dan Klein:I'm just kind of riffing out loud, but I don't know. This is this is totally right. And I think this gets at what you asked earlier about where are these systems strong? And this is exactly where they are incredibly like mind blowingly strong is the ability to take all that information, cross reference it with like all this context that's out there in terms of how you should run media that's a scatter across the web and to be able to distill things down. That sort of contextuality and breadth is just stunning. And in this case, the fact that it could read it all, pay perfect attention to it all, then give you something that if it were wrong, you would know, right?
53:38And that you were asking it for its generative capabilities. You were asking it to take all of the stuff, mix it together and give you a synthesis. well like that is a place where these technologies are incredible it's just that you know that's not every use case but when you have that use case that's a that's that really lines up well you were in the loop you were being the editor you're like oh i love this i love this and maybe there's something in there you weren't gonna say but that's okay because this gave you a lot i could draw an analogy to early machine translation where like you could read some of it and then there was some stuff that wasn't really even in the language you were expecting and like you didn't get everything, but it was, as you said, better than nothing.
54:16And in situations where something is better than nothing, mistakes are going to get caught by the consumer and where the primary product you wanted was this novel synthesis. Well, that's great. I mean, we can call it a hallucination. It was just a really useful one for you. Yeah, that's cool. Okay, gentlemen, you're out of tokens.
54:35Dan Klein:You're out of tokens. Jeremy Oddly. I'd put this one more in the, hot takes category, probably, actually, Hendrick. What do you think? You know, one thing, the biggest takeaway I think I had from it is, I remember once I was reading a finance newspaper that we have here in the Scandi market, and they were writing about some startup stuff. And as I was reading, I was like, oh, they really don't know anything about startups. They really don't. Like everything, the way that everything was phrased was just very, it was very clear that they completely misunderstood everything about startup and financing and stuff like that.
55:11And then I was like, hey, wait a minute. If there's this wrong about this thing that I know a lot about, I wonder how wrong they are about other stuff too. Right. And I think what he was just making was the exact same point with models. And I hadn't really completely thought about it because I love using those models. I use them increasingly kind of like I trust them more and more just to give me the right answer. But he made this point of saying the population of Berkeley is and, you know, the model will basically have a guess, right? And then I'll put something out. It might be right, but it's probably wrong.
55:46And then, so he was suggesting that you should write something, you should ask something you know a lot about and then kind of understand its limitations. Just to calibrate.
55:54Dan Klein:Yeah. I mean, to me, I think the one caveat, can I put one caveat there? Because I really agree with that tactic and actually love it as a starting point. Say, have a conversation about something that you know deeply to explore the kind of jagged frontier, so to speak. The caveat is I would never recommend someone have a single shot interaction like quiz AI and then see, oh, is its response good? That is kind of, that is demonstrably poor AI collaboration behavior. I think what you want to do instead is like, is engage and respond and give mentorship and feedback and guidance and recognize, wow, the AI is fully capable of evolving its understanding based on what I input.
56:41But I think that was kind of, that's leading to a second point, which is something you always talk a lot about that you shouldn't kind of be working on AI or you with AI. You have like this phrase about just making sure that this is a undirectional kind of thing that you go back and forth with. I think what he was talking to is that people have to change how they work, how they think about what their kind of function is in a workflow. And it used to be that, you know, going back to journalism, you can be a writer, you can be an editor, and it's completely two different jobs. Now, a writer most likely don't know how it is to be an editor, and an editor might have forgotten how it is to be a writer.
57:19and increasingly that when ai is basically giving out this world of abundance you now have to teach yourself how to be an editor and i think you were kind of talking to an editor's function which is it told just told you how many people live in berkeley what you would normally go like hey i wonder if the writer has actually checked that right and so you go back and say hey could you please double check that number is legit at which point the model obviously will do a web search and then probably come back with the right number of corrects. But that is, I think, something that most people are not trained to do.
57:51And so I do think that the conversation had this interesting kind of like insight for me is that we're just kind of used to work in a world of scarcity. And now we're going to be living in a world of at least generative abundance. And we then have to train ourselves to be good at being stubborn about really want to have excellent outcomes because it's going to be easy just to take the first one. We have to be stubborn to be an editor of things that comes at us because we have to be the one who would basically the fact checker because the model will obviously just say whatever and all those different things.
58:27And so I thought that was pretty interesting too.
58:29Dan Klein:I think it's a worthwhile paradigm is his discussion around digital literacy and seeing AI fluency as an extension of digital literacy. So that's a powerful thing. And then furthermore, to realize that some of the ways in which we have learned digital literacy are actually a disservice to us. And comparing Googling versus working with AI, things like that. I thought it was fascinating to think about the fact that so few organizations are investing in skills. And I wrote something down here. Let me see if I can find it. Yeah. This idea of new management training is something that organizations provide folks who've been given teams.
59:18Dan Klein:Nobody's getting new manager training now that they've been given the AI team. I think that that's a really interesting paradigm. And knowing, for example, how to delegate is itself a skill. And if you are a poor collaborator to AI, or if you don't know how to delegate, then you're not going to be able to be successful in a collaboration with this intelligence, not because the intelligence isn't capable, but because you lack the managerial skills to derive the best possible work from this new teammate. I thought that was pretty interesting. A small thing that he brought up, which also I think is just interesting, is that we are trained to spot things that are untrue on the normal web, partly because I think we're visually trained.
1:00:07Like if you go into a website where there's endless amount of banner ads and pop-ups, I think your brain now just goes, this is probably not a very legit website. But we are not, we're used to that things that comes over in a chat window is kind of probably from a friend or it's condensed. And so things that are written out that is lengthy is something that is real thought through because that is what we've seen before. And so I think there's also like the visual kind of the interface design. There's something seductive in the chat that makes us think that is real.
1:00:44Dan Klein:It triggers our impression of thoughtfulness. or he said, I think the word he used was fluency, but the appearance of truth is something that's difficult for us to discern when we are in edit mode or if, especially if we don't know that we're in edit mode. I think it's pretty cool conversation. I think it's, it's a unique conversation in our canon in terms of really focusing on understanding hallucination. What is it? When is it a feature? As he said, sometimes hallucination is the product, right? It's actually the point. And when, when you're not looking for a re, you know, a regurgitation of something that already exists, but you're actually looking for something new de novo to be generated, uh, hallucination is a feature, not above, but then there are other times when your goal is retrieval effectively, that hallucination is a problem.
1:01:32Dan Klein:And thinking about when is what system best? You know, I, I love, I love his point that, you know, if a reasoning system effectively just solves a problem 10 times and selects the best one. The person paying for the 10 at-bats probably doesn't like that. The person being paid for 10x the token usage probably loves it. Now, I think it's slightly a cynical view because I think as far as I understand it, model companies are largely losing money on reasoning queries and things like that. So I don't think they're getting rich off that. But I think it's an interesting paradigm to realize. His example of learning French from a French book is very much better and more effective than learning French from incidental French phrases in an English book.
1:02:20Dan Klein:Yeah, no, that was good too. Awesome. I think that's conclude the conversation today. So Jeremy, you do the backing at the end of this episode. What we need folks, what we need are enthusiastic shares and reviews. You know, I was reminded of, Henrik, I'll just make a plug for a former episode, our conversation with Muhammad Ali, the head of consulting at IBM. I was thinking about some of the things they've done in terms of treating themselves as client zero, proving the economic impact, deploying teams to internal workflow optimization, redeploying freed up labor to revenue producing lines of business.
1:03:07Dan Klein:it's a really cool example and if folks haven't heard that interview they should go back and listen to that as well but with that as always only one thing to say and that is bye-bye bye-bye
From the publisher
Dan Klein, professor at UC Berkeley and CTO at Scaled Cognition, explains that AI systems generate answers based on patterns in language rather than verified knowledge. This is what allows them to be flexible and useful across many tasks, but it also means they can produce confident answers even when they are not fully accurate.
He introduces the “jagged frontier,” where AI performs very well in some areas and less reliably in others. Because responses are fluent and easy to read, it is not always obvious where those limits are, which makes it important to stay engaged when using these systems.
The conversation also explores hallucinations as a natural part of generative systems. In some cases, this is what makes them valuable, especially for creative or open ended tasks, while in other cases reliability becomes more important.
Finally, Dan highlights that working effectively with AI is a skill. As more people start using these systems in their daily work, knowing how to guide them, check outputs, and use them in the right contexts becomes increasingly important. He also shares how his team at Scaled Cognition is approaching this challenge, focusing on building more deterministic systems designed to provide stronger guarantees and reliability, particularly for high stakes, policy driven use cases.
Key Takeaways:
- AI is designed to sound right, not to know it’s right
Models generate fluent answers without knowing whether they are correct, which means users need to actively evaluate outputs - You have to learn where AI works and where it doesn’t
Capabilities are uneven, and understanding those limits is key to using AI effectively - Working with AI shifts your role from creator to editor
Instead of starting from scratch, you are reviewing, refining, and validating what the model produces - Most people are using AI without knowing how to manage it
Skills like delegation, verification, and judgment are becoming essential, but are not widely taught
Dan's LinkedIn: linkedin/dan-klein/
Scaled Cognition Website: scaledcognition.com
Scaled Cognition LinkedIn: linkedin/company/scaledcognition/
Scaled Cognition X: x.com/ScaledCognition
00:00 Intro: Fluency vs Truth
00:34 Meet Dan Klein
02:53 Why Fluency Misleads
05:11 How LLMs Guess
07:30 What Is Hallucination
08:54 Deception and Alignment
11:22 Why Agents Break
12:48 Chaining and Determinism
16:01 When Hallucination Helps
22:33 Beyond Scale for Reliability
30:40 Synthetic Data Training
31:10 Enterprise Agent Use Cases
33:44 Healthcare Risks
39:13 Enterprise Literacy Gap
41:27 Delegation and AI Management
54:37 The Debrief
📜 Read the transcript for this episode
For more prompts, tips, and AI tools. Check out our website: https://www.beyondtheprompt.ai/ or follow Jeremy or Henrik on Linkedin:
Henrik: https://www.linkedin.com/in/werdelin
Jeremy: https://www.linkedin.com/in/jeremyutley
Show edited by Emma Cecilie Jensen.




