Personal Investment Strategies, Effective Public Policies and Should We Tax AI?

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1:25I'm spending money like a 50s gangster just diagnosed with ass cancer.

1:32Hi, everyone. This is Pivot from New York Magazine and the Vox Media Podcast Network. I'm Kara Swisher. And I'm Sky Galloway. And Scott, this is our end-of-the-year listener mail episode. We're probably both elsewhere doing fun things. But are you ready to hear some emails and voicemails from our lovely listeners? Who, by the way, we have a full new appreciation for after meeting so many of them on our Pivot Live tour. I really enjoyed that. Are you ready? Yeah. Yeah, ready. Okay.

2:02Okay, Scott, let's kick off with a question about taxing AI. Let's listen. Hi, this is Lynn. I've been wondering, as artificial intelligence continues to replace human jobs, do you think we'll ever see a tax on AI itself or on the companies that use it as a way to offset its impact on displaced workers? And would that, in a sense, become a new way of taxing the rich. Of course, this would affect 401ks on a larger scale. Thank you. Bye. Gosh, Lynn, what a great question. Actually, I'm going to start, you know, many years ago, Bill Gates sort of set off a kerfuffle when he talked about taxing robots if they become workers the same way, because you aren't going to get those money that you get from human workers.

2:47And so they should be taxed the same way. I hadn't really thought about it about AI. Scott, I think you're more qualified to answer this. I don't know if that's true. My view around taxation is that the moment you start taxing specific industries, you weaponize special interest groups to come to their defense, and you also create some confusion around, like, is Oracle AI? I mean, at what point what qualifies as an AI company and not an AI company? Is Microsoft an AI company? What I'm a big fan of, and I think that the caller is alluding to, I want to go back to Reagan era taxation. And that is there's no difference between, I think the capital gains tax deduction is nothing but a transfer of wealth from young to old, because somehow we've decided that sweat is less noble than money.

3:37And that is the money I make on money gets taxed at a lower rate than the money that young people make on sweat. So I would like to see an elimination of the capital gains tax deduction and raise those rates to current income and restore a progressive tax structure. In my view, you do it across all income and all firms because I think the moment you start getting into this notion of let's put a super tax on this type of firm, I think you regulate them. I think you have an EPA, you have an AI Act, you have privacy, you have laws. But in terms of taxation, I just think you say, look, above a certain level of profitability, when you sell a stock, you pay this much in tax.

4:15I think taxes need to go up. I think we need to do away. We need to raise long-term capital gains from 21 % to 37%. It makes no sense that I'm paying lower taxes than people actually working for a living. But I think you apply it to every company. Because a lot of, for example, the AI boom is going to make a lot of people in the construction industry very, very rich. Yeah, it is. That's one group of people that are benefiting. Yeah. Would you tax them, right? Would you tax? Oh, my attitude. There's so many loopholes right now. The only way we get there is with an AMT. There should be an AMT. Anything above$10 million, anything above$3 million, you pay a federal AMT of 40%.

4:53Yep. Because what happens is guys like me weaponize the tax code and do 1202 and buy assets, and we end up paying high teens in tax rates. So the stated, we focus too much on tax rates, not on the tax code, and enough already. There is no reason why someone working for money should be taxed at a higher rate than someone who is making money from investments. Although I don't see anything wrong with taxing robots if they're workers. I don't know. It's an interesting one. Yeah. Yeah. When he said it and I thought, oh, Bill Gates. And I thought, oh, actually, he's really smart. I forgot. Anyway, it's an interesting question.

5:24We have to deal with all these things and what happens with displaced workers and how we're going to pay for that or get them different jobs. So there's going to be a lot of rethinking of all the way the workplace is taxed, how it's conducted, what people get paid, and obviously the damage that some of this AI is going to do. There's going to have to be some mitigation. Okay, Scott, next question. This one is a tough one. Let's listen. Hey Scott and Cara, I'm Liam, a high school senior from New York, and I want to ask the following. America certainly has its fair share of economic and social problems, but a lot of the time these problems stem from the same root causes.

5:57Too often, though, our politicians create costly band-aid solutions rather than trying to address the underlying issues. So my question to you guys is, if you could implement one single policy to try and solve the most problems at once, what would it be? Thanks for taking the time to answer. Wow, that's a great question. I hate that. Just one thing, if I had to pick,$25 minimum wage. I like that. Let me explain very quickly. Yeah. Because I think it lists all votes. If people get paid more, they'll spend more. It creates a better economy. I know there's initial costs for businesses that have these things, but it creates people that can do a living wage.

6:37They spend money. They want to do things. They lean into the future. It would be great. The second one would be eight million houses, more housing, but go ahead. Once a program, one is structural or legislative, I do think a lot of this reverse engineers to, in terms of inability to get things done, to Citizens United. If I could overturn Citizens United, I think a lot of our problems stem from the weaponization of Washington by corporate interest and corporate money. Oh, wow. Wow, Bernie Sanders. I like that answer. Well, I mean, it's just true. There's more full-time lobbyists living in D.C.

7:16working for Amazon than there are sitting U.S. senators. But, you know, a close second, mandatory national service, universal child care, lower Medicare eligibility by two years a year for 10 years until three-quarters of America has essentially socialized medicine. I could go on and on. Yeah, I love it. I love that answer. I was not expecting it. Boy, that came out left field there, Scott. All right, Scott, let's take a quick break and we'll be back with more listener questions.

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9:53Support for the show comes from Z Biotics. So, I drink a little bit less these days. I'm trying to tone down my consumption of alcohol, as I think is a good idea when you get to my age, 50. but when I do pour myself a cocktail I want to make sure my next day also feels great or let me say just to be honest less bad and if you want to feel your best in the morning or better in the morning you could start the night before with Z-Biotics. Z-Biotics pre-alcohol probiotic drink is the world's first genetically engineered probiotic it was invented by PhD scientists to tackle rough mornings after drinking and according to Z-Biotics here's how it works when you drink alcohol gets converted into a toxic byproduct in the gut it's this byproduct not dehydration.

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11:19Scott, we're back. The next listener wants to know what we're doing with our money. Let's listen. Hi, Scott and Kara. It's Eric from Brooklyn. Scott, you talk a lot about how you spend, how you invest, and I imagine how you save. Kara, you don't, and you come off as maybe a bit more frugal. Can you share a little bit about your investment, spending, and saving philosophy in the context of your shared success? Thank you so much, and hope we'll see you soon. Gosh, thanks, Eric. A little personal. I am not, I don't think about money a lot, and that's my problem. I'm not interested in it, and I make a lot of money.

11:52I do, especially for a journalist. I'm like Daddy Warbucks, a journalist in that regard. But I would say I save a lot. I have a lot of savings and I diversify. I'm sort of your basic person, basic bitch of investing. I have bonds. I've got quite a bit of real estate that I hold on to for savings, as Scott calls it. I don't spend a lot of money. I really don't. It has nothing to do with me being frugal. I just don't. I don't like buying a lot of stuff. I'm wearing the same. All my clothes I've had for 20 years. I don't buy a lot of clothes. I don't buy drugs. I don't go out a lot. You don't buy drugs?

12:28Where did that come from? Well, no one here buys drugs. Maybe you. I don't buy, like, I don't drink. I don't party. I'm trying to think, like, what costs money? I have a Chevy Bolt, like, and a Kia, so I don't really care about cars. You're the primary breadwinner in a family of four or six people. Yeah. I mean, that in itself is, mommy's got to make real money. Mommy's got to make real money. And so that's spent on the kids. I definitely get them through college. But I did those savings plans for college for my boys, and I'm doing them for my little kids. That worked out really well, actually.

12:59I didn't have to think about it. And I did that 20 years ago for my older kids. Anyway, I have a basket of stocks. I've got real estate. I'm very diversified. I have a lot of cash right now. I really do. And I thought for a second I'm going into Bitcoin. And when Scott said it, and I thought I don't have the tolerance for it. It's because I need cash around. I have way too much cash compared to what I need. But I like to have it. I'm one of those sort of people. I do spend money on a couple of things. I mean, I always get first class. I fly, well, you know, I don't have a private plane, but I would love to have one.

13:33But I'm sorry to say that people who love to save energy, but I think they're wonderful. And I will upgrade all the time, like upgrade hotels and things like that. So I got old very early. And then I'm like, I didn't want to be in bad food. I didn't want to stay in bad places. I suppose if I spend on anything a lot, it's vacations. I really, I do, but I'm still more frugal than Scott. Scott is really, I really admire Scott's vacation spending. I don't know, Scott, what do you think? Well, you know, I think a lot about this. One of my addictions is money. And that is I continue to be too focused on it to the detriment of my mental health.

14:12And it takes time away from my family. I grew up with a scarcity of money until, you know, I got through my senior year of college on top ramen and bananas. That's not an exaggeration. I was in student debt. Even at the age of 27, I was not traumatized, but I had a difficult time paying for my mother's healthcare. So I've been very focused on money and got very lucky. And that's not a humble brag. I think I'm a monster. I think I'm talented and hardworking, but I did get lucky. And now I am, by most people's standards, wealthy. My approach to spending money is that we don't own money, we rent it.

14:49And I also, you collide that with my atheism. I believe that this is all coming to an end pretty quickly for me. So I spend a great deal of money. I spend between$300 ,000 and$400 ,000 a month. I own homes all over the world. I have a plane, and I spend most of my money on homes and experiences. Not gifts for Kara, just for you. But along those lines, the way I try and keep in check is I think hoarding money is a virus. When I hit my number eight years ago, I decided anything above that number I would give away. And what I do each year is I look at my total spending and I match it and I give that amount of money away.

15:29And it keeps my net worth has not increased in eight years. And because I think hoarding wealth is a virus, there is no reason anybody needs to be a billionaire. But I can't stand it when wealthy people aren't good at spending money. I have an amazing time. I do things for my friends and family to get us all together in the same place. I never let money get in the way of a good time. I'm spending money like a 50s gangster just diagnosed with ass cancer. I think it's a nicer way of putting it. Scott is very generous, let's just say, to employees. Scott's a very generous person. But we don't own money.

16:06We rent it. And I'll give my kids some money, but there's no reason why my kids need to inherit tens of millions of dollars. So I'm going to spend it all on people I love and experiences and take advantage of capitalist society. And I'm also going to give a shit ton of money away to make sure that the things that made me rich are still available for younger people. So I love making money. I love spending it. I stopped making it eight years ago and anything above a certain level, I give away. In terms of my investments, I'm pretty well diversified. My quote unquote investment strategy is the following.

16:34I think income inequality, unfortunately, is only going to get worse. And what I find is that people worth over$100 million are the most homogenous, boring people in the world. And that is they all want to party in St. Barts. They all want to buy Hermes. They all want to send their kids to elite colleges. And they want to live in one of five areas. They want to live in Dubai, London, Palm Beach, New York, or Aspen. And I bought homes in all of those places except for Dubai. Big homes and the way I refurbished them and what I tell my contractor and my decorator is pretend Jeff Bezos is going to buy this home because the world is going to produce thousands of billionaires over the next 20 years.

17:09And by the way, I think it's a terrible thing about our society. I will vote for people to try and reverse that. But the free gift with purchase is that these homes, I want to make it impossible for my boys to avoid me. And the conversation when they're, say, at UC San Diego or something, we can go to Tijuana with our friends and eat lobsters, or we can go to Aspen, but we have to have dinner with my dad. I'm hoping that they'll say, yeah, let's go hang out with dad. Oh, that's a bribe. I spend a shit ton of money. I love it. I give it away. It's not virtue. It's not ethics. It makes me feel strong.

17:38It makes me feel masculine. It makes me feel American. But I'm planning to not increase my net worth. There's no reason anybody needs to be a billionaire. It's not going to make you any happier. What's going to make you happier is doing amazing things with people you love and doing nice things for other people. And I spend to that. And I very much enjoy it. And money is something I think a lot about because I didn't have a lot of it. growing up. It's still a very big issue in my life. Yeah. It's interesting because I grew up with a lot of money. And so I guess I don't care. I've always had money.

18:11You think about money less than almost anybody I know. I know. You get mad at me because I don't. I don't. I have enough. I like I don't. Also, let me point out, my mom was a spendthrift and it upset me and made me, both my brothers and I are very hard workers and we don't spend a lot of money. All of us are very, like my brother built a beautiful house in Pennsylvania where he lives and it's beautiful and he didn't, it's gorgeous and he loves it. And so that's what he spends money on. And I love that because I feel like it was money well spent because he enjoys it and it's quite beautiful. It's a beautiful setting.

18:42So we always spend money on homes, but not extremely, like not like ridiculously. Same thing with Jeff's, has a beautiful home. I have a beautiful home. You live well, not opulently, is the way I would describe it. No, not at all. No, people are always surprised. I also, I had the luxury of not having to worry about money early in my life, But there was a lot of my mom being such a spencer. She was always out of cash and she always had to scrounge for it and trick people, get her dad to write her a check. And I found that grotesque. I did. I was like, I'm always going to have enough money. And I had money from a very early age because my dad died.

19:15It was an insurance thing. And I got a hold of it when I was 18. And I have not. I didn't want my mom near it because she spent a lot of our money that we got from my dad. And so I've had control of my money for years. So I just don't care about it enough. I just don't. I just, I wish I did. Like, I want my boys to work hard, my older boys to work hard. And I think they do. Both of them are really hard workers. And again, just like Scott, they're going to get the houses is what they're going to get, which I love the house. So it's something like that. All right, Scott, let's get to a question about parenting.

19:48Let's listen. My name's Lisa. I'm the mother of a 17-year-old boy and a 13-year-old girl. Two years ago, their father died unexpectedly. terribly. Tara, as someone who lost their father and also as someone who's raised children without a male partner, and Scott, as someone who's largely raised by a single mother, I'm looking for advice. Tara, what do you wish your mom did to keep your dad's memory alive? What did she do right or wrong? Scott, what did your mom do right to make you feel like one parent was enough? What do you wish she would have done if, for example, she had had more financial resources?

20:20Thank you both. man these are good questions they're highly emotional Jesus I don't think my mom did a very good job I hate to trash my mom this episode but it's true you know she lost contact with my dad's parents and I reestablished it when I was in college myself you're a kid you're a little bit at cross purposes of loyalty and I thought that was not good she threw away a lot of pictures which I recovered some of which I spent a lot of time I'm finding stuff about my dad. And I right now have a big box of letters of his that I just read one that was wonderful. I think she should have spent a lot more time talking about him.

21:00And I don't think she remembers herself, but I don't think she was kind to his parents. So that was one thing is if your grandparents are good people, make sure your kids know them and know their relatives on your dad's side and they're his friends. I wish I knew more about my dad's friends. And I found out later when I wrote a piece in the Washington Post, I got inundated with friends of his that my mother never told me about, that I then went and met and all these stories. I think I've said this before. There was a gay couple who my dad was lovely to, and I didn't know that. It was a wonderful thing to find out.

21:34A young African-American woman he tutored wrote me. Now she was a doctor and said she wanted to thank him. An ex-girlfriend of his wrote me saying it should have been me that married him. which was funny. Like there's a picture of him behind me. I have a lot of pictures of him around. One thing I'm sad is my kids won't know him. I named my, and I also named my son after my dad. So that's what I would say. It's nice. Yeah. I mean, there's, uh, just thinking about it, um, stirs emotion. So when I was 15 and in California, you were what you drove and just having a car was everything. You'd had no social life in high school in LA.