Andrew Cuomo & White House AI Czar David Sacks 7/24/25

26:47You're exactly right. First of all, you can't have a socialist city in a capitalist nation. That does not work. Right. You can't have a city where you say everything is free. We're going to have hyper tax wealthier people and expect them to stay here. Right. They'll they'll move. They'll leave. They have been leaving. Right. Especially post covid. They're more mobile. So that's what he is selling. Now, he's a smooth salesman, and he's got slick slogans, freeze the rent, and fast free buses, and, you know, politics has become so superficial now. And my fault, my campaign didn't really push him on it.

27:31And the Middle East issue was very big with those under 30 voters. So that's what happened in the primary. I do not believe in the general election you can sell that. We are not socialists. Right. Even in New York, we are not socialists, even Democrats. We are not socialists. And they get it. You know, New Yorkers are savvy, everything free. You know, if it sounds too good to be true, it's probably not. There is no free lunch. They get it. But we have to have that dialogue. You said the Middle East situation played a role in this. And I hear from business leaders all the time about what they fear, not just about the socialism piece, but what they think of as anti-Semitism coming from Mondami or a sense that he would allow anti-Semitism to flourish in the city.

28:23So let me start with a very basic question. Do you think he's an anti-Semite? You know, Andrew, that requires the ability to look into someone's soul. Are you anti-Semitic? Are you racist? Are you a bigot? I can tell you this. He fuels anti-Semitism. I mean, something as basic as globalized intifada, which basically says, kill Jewish people globally, period. He refuses to condemn that statement. Most people say if they're getting pushed and pushed and pushed, well, I'll discourage the use of it. He doesn't believe in Israel as a free Jewish state. I mean, these are very basic things. And this has been core to who he is.

29:07We have the largest Jewish population outside of Israel. Right. And we have some of the highest level of anti-Semitic activity in the United States of America. So, yeah, people are scared, and they should be. Do you feel that you're running against him or Eric Adams in this moment right now? It is against Mamdani. I do not believe Eric Adams is electable. I think all the data shows that. I think him not getting into the Democratic primary shows that by his own actions. You know, if you can't run in the primary, you can't be competitive in the general. You raised a lot of money before the primary.

29:49How is that going now? How are you able to raise money from big donors? I am. But I tell you the truth, one of the lessons I learned, I spent too much time raising money in the primary. People know who I am. They know my message. It took a lot of time because in New York City you have very low levels of donations, so you have to do a high volume of fundraisers, and that took a lot of time. And I'm focusing now more on just getting out, getting the message out. Do you get additional voters to register the way MomDami does, and if so, who's the target audience? We will register more voters, but by the natural movement now in the general is you have a much larger pool.

30:34And I believe Mamdani, the way he activated the under 30, he's also going to activate the people out there who are afraid of an anti-Semitic socialist. So we had something like a million votes in the primary. The last general was only 1.1 million. You think it's going to be a much higher. Yes. You had a higher primary turnout than usual. I think you're going to have a much higher general turnout than usual because, don't kid yourself, people are afraid of him. He is radical. Let me ask you about Adams, though. The track record of Adams is actually not bad. It's actually quite good. If you look at what's happened to the city over the last two years, I think people would say safety has become a lot better.

31:21I mean, there's been a lot of metrics you could look at in a positive way. I think the big overhang on his candidacy is that a lot of people look at him and think that he is being held hostage by the White House, by the president, and what that means for the city. What do you think that means for the city? Well, first, they don't get past your last point. Adams got indicted. He made an arrangement with the president, which is unprecedented, right? January 6th, he gave people a pardon and he said, go home. With Mayor Adams, he said, I am going to drop the charges so you can cooperate with my administration, specifically when it comes to immigration policy, and the prosecutor reserved the right to bring the charges back.

32:12So it looked like a transaction where Adams was bargaining for Adams, saying, drop the charges, I'll do what you want. And President Trump is not popular, decidedly not popular within the Democratic electorate. So that's point one, and that's fatal. Number two, there's been a series of corruption charges, almost on a weekly basis, more supposed to be coming. And third, Andrew, I don't agree with you that people think the city is better, maybe marginally better. You know, murders and shootings are down. Thank you. But rapes are up and robberies are up and grand larceny is up and homeless, mentally ill people on the street that I'm afraid of.

33:01And the subways in the condition of the subways. So, no, New Yorkers are not going to vote for another four years like that. Somebody made a fascinating argument to me about Eric Adams and his relationship with the president as it relates to being a positive for the city. I want to posit it with you. We have not seen in this city ice arrests and raids like we have seen in L.A. and Chicago and other cities that National Guard has not been called in. And the question is, why is that not happening in this city? There is a speculative view that that's not happening because the president doesn't want it to happen to protect him.

33:39Do you think that's true? And do you think if you win or Mondami wins or somebody else wins, that all of a sudden the city is going to turn into some kind of National Guard ice raid scenario? Well, there's two theories, neither of which works ultimately. First theory is the president doesn't have to send in anyone because he has Adams doing his immigration work. Right. Adams is in lockstep with honing in his whole immigration team. So, of course, the president doesn't have to send anyone in because he owns the New York City mayor who is executing Trump's policy, which is opposed by the Democrats.

34:25Second option, President Trump has recently said, I'm sending in people. He had Homeland Security, Kristi Noem, come in here just yesterday or the day before and was adamant that they had to send in federal troops. So, you know, with the president, you're not really sure which way it turns out. But neither is good. Neither Adams is the proxy for President Trump. That's the kiss of death among Democrats. And Democrats are, again, 70 percent of the electorate. or the president winds up sending in the troops like L.A., and that's even going to be worse, because then you'll see the Democrats just explode.

35:07Have you met Mondami, by the way? I'm on the debate stage. But that's it. Yes, he's been an assemblyman. He's 33 years old. He passed three bills. He was basically a non-entity in the Albany legislature. He was basically absent. and this is what he does. He's a social activist, advocate, smooth salesman, slick slogans, and left unchallenged. They buy it, right? It's the infomercial that comes on at 3 o 'clock in the morning. One pill, lose weight, increase your libido, live to 100 years old, order now, get two more free. And finally, what's your relationship like with Eric Adams? Because you guys are going to have to get on the phone at some point, I assume come September and there's going to have to be a decision made about who's who's going to, you know, take the torch and keep going.

36:03Yeah, but I think that's that's that is what it's going to be. Andrew, you know, he's out there campaigning. I'm out there campaigning. Do the research whenever you want. September first week, middle of September. Who has a better shot against Mamdani? That is a quantitative question. You can figure it out. And if you believe that it's really about stopping Mom Donnie, which I genuinely do, then do what's in the right interest of the city. And the strong one goes ahead. The other person defers. Otherwise, you're just a spoiler and you're driving the car off the cliff with the family inside the car.

36:46Governor Cuomo, thank you for joining us this morning. Thanks for having me. Fascinating conversation. Come on back as this progresses. We appreciate it. Thank you. Next on Squawk Pod, David Sachs, the White House artificial intelligence czar on the global race that he says is more important than the last century's space race and is right on top of the president's to-do list. If the U.S. leads, continues to lead in AI, we will be, will remain the most powerful country. But if we don't, we could fall behind our global competitors like China.

37:20You're listening to Squawk Pod from CNBC. Today with Becky Quick and Andrew Ross Sorkin. Up in Andrew, Q. Good morning. Welcome back to Squawk Box right here on CNBC. We're live at the Nasdaq market site in Times Square. President Trump laying out AI priorities for the federal government at a high profile event in Washington. Eamon Javers joins us right now with more on that. Eamon, we're trying to figure out what this means overall and what we can expect to see in the industry as a result. Yeah, good morning, Becky. Look, pledging that the U.S. will do whatever it takes to retain its global lead in artificial intelligence, President Trump signed three executive orders yesterday to speed up development in the field.

38:02The orders are designed to accelerate permitting of AI projects, expand U.S. tech exports, and eliminate what the president called woke in AI. Now, the president's plan aims to block the government from contracting with tech companies unless they ensure that their systems are objective and free from what they call top-down ideological bias. Now, I asked White House officials on a call yesterday who's going to decide what ideological bias is. They responded that what they're mostly concerned about is eliminating diversity, equity, and inclusion values from AI. Officials said they're also focused on clearing away regulatory hurdles to new projects, particularly environmental concerns around new plant construction.

38:45Trump also said he doesn't want copyright concerns, slowing down AI's ability to utilize the world's knowledge base. When you read something and when it goes into this vast intelligence machine, we'll call it, you cannot expect to every time, every single time say, oh, let's pay this one that much, let's pay this one. It just doesn't work that way. Of course, you can't copy or plagiarize an article. But if you read an article and learn from it, we have to allow AI to use that pool of knowledge without going through the complexity of contract negotiations. Now, that's significant because as you guys know, media organizers, authors and others have brought a barrage of lawsuits against AI firms for allegedly ingesting their work into large language models without financial compensation.

39:36Back over to you guys. Yeah, that's pretty powerful in terms of what it means for all of these media companies and others who have been suing to try and uphold their rights on some of these things. kind of goes back to what Satya Nadella said maybe a year and a half ago or longer to 60 Minutes when he said basically, maybe it was Lester Holt where he said, look, we have to rethink how copyright laws work, essentially, to make sure that this progress gets made. Clearing the pathways for some of the environmental issues for trying to build out faster. I just wonder what you think that is going to mean, Eamon, in terms of how fast the progress goes, what this means in terms of America winning the AI race with China?

40:22Yeah, look, I mean, I think it's largely environmental, right? And what they're concerned about is any kind of environmental reviews or any kind of regulatory slowdown of this vast data center buildup. And also, you know, the power supplies that's going to be important for AI as well. So I think if you are in the AI business, if you're in the data center business or anywhere adjacent to that. What you can expect now is sort of the full weight of the federal government, sort of on your side of the argument, whatever it is on regulatory matters. I think that's probably a good thing for the AI industry as they look to expand.

40:58And I think, you know, you just saw the president throw himself on one side of this copyright issue with he's all in with the AI industry on this saying, you know, they shouldn't have to be beholden to copyright as they ingest all this material, because that's sort of the world's knowledge and that should be for the world. Now, if you're somebody who's an author or a media company, you might disagree. You might say, well, that's our knowledge and you're stealing it. So that debate is ongoing. The president clearly taking a side there. And all of this will be decided by federal agencies who are large purchasers here.

41:35And the influence that they're using is the federal procurement of all of this stuff, they're going to set terms within the federal government for what they buy, including this sort of unbiased ideologically guideline around this idea of not having DEI or woke ideology built into the AI. All of that's going to be in what the federal government buys, and that's going to be very influential for the industry. Okay. Eamon, thank you.

42:05Joining us right now is White House AI and Crypto Czar David Sachs. And David, welcome. We really appreciate your being here today. There's a lot that we've been trying to figure out, trying to understand what yesterday all means. And I wonder if you can tell us how the private sector reads all of this and what they will do in response. Well, thank you for having me. I mean, first of all, let me just frame up what I think President Trump did yesterday. It was, I think, the most important technology speech by an American president since President Kennedy declared that we had to win the space race.

42:40And in a similar way, President Trump declared that we had to win this AI race. And I think you could argue that the AI race is even more important than the space race, because it's going to determine who reshapes the global economy and who the superpowers of the 21st century are going to be. If the U.S. leads, continues to lead in AI, we will be, we'll remain the most powerful country. But if we don't, we could fall behind our global competitors. like China. And I think President Trump laid out a plan for winning this AI race. David, I'd agree with you. I think this probably is more important than the space race.

43:16How far ahead of China do you think we are right now in this race? How long would it take for them to catch up? How do we prevent that from happening specifically? So I think when you look at our lead in the AI race, it kind of depends on what level of the stack you're looking at. So, if you look at the top of the stack with the AI models, we're only, I would say, months ahead of the Chinese models. They've done a good job with models like DeepSeq and Quen. But if you go deeper in the stack, we have, I'd say, more significant advantages. So, when it comes to chip design, our leading company is NVIDIA.

43:50Their leading company is Huawei. I would say that NVIDIA is still a couple of years ahead. Then you go deeper in the stack to chip manufacturing, and you've got TSMC on the western side of the ledger. And they're several years ahead of the Chinese national champion, which is called SMIC. So it just depends on what level of the stack you're talking about. But I think the most important thing is that we try to maintain this lead. We don't want to sacrifice it. And I think President Trump brought up a few really important ways of doing this. Number one is we have to unleash American energy. The new AI data centers, the new infrastructure we need to build is very power hungry.

44:24It requires a lot of electricity. And President Trump signed an executive order to build out AI infrastructure. And he's understood for a long time that we have to drill baby drill. We have to build baby build. We have to, again, if you want to have AI dominance, you've got to have energy dominance. So that was a huge part of the speech. Another area that I think is very important that President Trump talked about is AI exports. We want the whole world using the American tech stack. We want the world to consolidate around an American standard. If we don't provide that standard, Huawei surely will.

44:54And so I think President Trump brought up that and he signed an executive order to make AI exports easier. He also made commentary. Well, actually, let's go to the energy part of this first, because signing this executive order is one thing. There have been others who have theorized that you really need an infrastructure plan that's organized by the government, kind of like the national highway system was set up. Do you think we need something along those lines or can private industry really step in and bring us the energy needs that are going to be upon us in the next couple of years? Well, private industry is already investing hundreds of billions of dollars in this infrastructure build out.

45:34So the private sector investment is there. What we need to do is unlock it from the shackles of all this red tape. It takes years to get permitted. President Trump promised to make that easier, to bring the timeline down from years to weeks or months. There's environmental concerns that really tie up these projects. And he's tasked Lee Zeldin with solving those. So I think that we do need to have more of a partnership mentality with the private sector. But it's the private sector is going to do the building here. And we just need to get unnecessary red tape out of the way to enable that. David, related to that, though, is this question just how much energy is going to be consumed?

46:12We talk about it on this broadcast all the time. The amount of energy that's required, the amount of water that's required. Obviously, certain states are better adept and also have less regulations around them. But ultimately, you know, we've had some guests come on and say, you know, five years from now, all these governors who are begging for this stuff to happen in their state may say to themselves, you know what? Electricity prices are going to go up in my state to consumers. There's a question if there's a hurricane who ultimately gets the electricity in that because of the uptime requirements and guarantees that a lot of these tech companies are making.

46:45with the data centers and therefore the energy providers, that that could leave consumers out in the cold. How do you think about that dynamic? Well, this is exactly why I think we have to build more energy. We have to unleash American energy is because you don't want residential prices to go up every time you add a data center. It doesn't make sense. So it's true that in order to enable these new data centers are very power hungry. You have to build more power generation. But that's the whole point of the executive order. And that's the whole point that President Trump's policy around making it easier to, again, drill, baby, drill.

47:16This is a campaign promise he made years ago, is that we had to make it easier to produce American energy. And he's had all of the above approach. I mean, he wants to make it easier for natural gas, for nuclear. He signed executive orders to make nuclear easier, and even what he calls big, beautiful coal. So I think that, you know, the president has had this idea for a long time. He understands that more energy production is the basis for all future growth. And now that we have this AI boom going on, it's definitely the foundation for the growth in AI as well. So I think this is the plan of administration is we got to produce more energy.

47:53Hey, David, as the AIs are, people look to you for a lot of things, but you're a huge person from Silicon Valley, a huge figure in the industry. You grew up with PayPal next to Elon Musk. You learned an awful lot about that. You're obviously invested in XAI as well. I just wonder how you look at the world in terms of open source or closed source models on these things. What you think about what open AI is doing right now. Do you have the same views as Elon Musk when it comes to what Sam Altman is doing? Or do you see things a little differently? Well, we don't take sides in which AI company is going to win.

48:34We just want to create the conditions, the environment for American AI to do well. And then within that environment or that ecosystem, we want to have at least several companies, maybe many, many companies competing. And we think that competition is good. That's what ultimately spurs America on. You know, under the Biden administration, they had this approach under this Biden executive order on AI of anointing a few winners in this AI race. They had this mentality that they were going to centralize and control. And what we want to do is just create a level playing field so that we let a thousand flowers bloom.

49:06And we think that competition brings out the best in everyone. That's how America wins is we create the conditions for our private companies to compete with each other. David, but speak to this if you can. You know, I've marveled at how successful Elon Musk has been even in the past year and a half in terms of spinning up XAI. And I would argue a lot of that has been his experience as a genuine engineer in terms of hardware and understanding energy. I mean, a lot of what we're talking about here is about energy. There have been questions recently about Stargate, which, of course, is the endeavor that Sam Altman and OpenAI have undertaken with Masa Sun.

49:42And how that's working out and how quickly that can get rolled out. How much, A, do you think that there's any issue with where Stargate is and how quickly that will roll out? And B, how much do you think that there's an issue of just how much experience and knowledge lives in Silicon Valley in terms of engineering to deal with this energy issue? Because the experience, with the exception of maybe Elon and some others who've dealt with hardware, is very different. Well, it's true. You know, I've spent time with folks from Silicon Valley and folks from the energy industry. And they are rather different industries.

50:19And in the past, they haven't intersected that much. And there are, I think, cultural differences between the industries. In the past, the energy industry, the grid, for example, has only grown by a couple of percent a year. They just haven't ever had to contemplate the issues of hypergrowth. And then, by contrast, Silicon Valley is really all built around how do you scale as quickly as possible. But I think what's happening now is those conversations are happening. The Silicon Valley companies are driving out new requirements by the energy companies. And I think there's a lot of learning and sharing that's happening across those industries.

50:56So I think this is going to be figured out and it's going to be enormously helped by the Trump administration, making it easier to produce more energy. That's really the key here to solving this problem. We have a situation now through the one big, beautiful bill and what the White House did yesterday, where you're not going to have a lot of states in different jurisdictions that are setting new rules for AI in different ways that they have to compete. but you're still going to have to figure out how this works around the globe. You think of the Digital Services Act and what Europe has already done to some of our technology companies by trying to crack down on them.

51:30How do you and the president look at this in terms of how we kind of navigate other jurisdictions around the globe and what they can and can't do, what they should and should not be able to do when it comes to our AI companies? Well, what the president said in his speech is that we don't want overregulation to cost us winning this AI race. And that overregulation could happen if the states go wild overregulating. And there is some indication that that's a possibility. You've got a thousand bills going through state legislatures right now. And the president also said that these international bodies also should not impose a necessary regulation.

52:05So I think that this administration will push back on that and we'll just have to see exactly how that plays out. But I think the basic idea here is that we have to prioritize winning the AI race and we have to make sure that regulation is sensible. We're not saying that there shouldn't be any regulation, but we don't want there to be so much of it that it hobbles our AI companies and our innovation. And we also don't want so many different regulatory regimes that it creates a patchwork and it's confusing to our AI companies. So I think you'll see this administration pushing back in those areas.

52:37What we did not hear, though, is any protection of copyright. In fact, the president himself said that copyright holders may just lose out on this, essentially. How do you make sure we win this race but also not trample the rights of the creators underneath all of this as well? Well, the president said that AI models can't copy or plagiarize rights holders. So that's very clear. The question is around ingestion of data for AI training. And that is a question that's being litigated in the courts right now. And ultimately, what it will come down to is what is the fair use definition for AI training data.

53:15And I think the president started to stake out a position there that merely ingesting data for learning purposes is not a violation of copyright, as long as the model, again, does not copy or plagiarize the output. So we have a distinction here between inputs and outputs. And this is a question that's being litigated by the courts. But I think that President Trump's statements on this are very common sense. And I hope they will help guide this issue. David, let me ask you about that, though. And this is maybe a philosophical philosophical question. So I've been writing a book for the last eight years, a history book about 1929.

53:48And so I've ingested, if you will, hundreds of books, by the way, that I've read to learn about all sorts of different component parts. And hopefully some of those pieces end up not plagiarized, but in the book. and there's a bibliography and all of that, right? But that's one person, that's me doing that. And I can go to the library and get the books. I can go buy all the books. And I think we understand how that works. I think it's different, right, if a machine ingests the books and then can then not just spit out one book, it took me eight years to do this, but can spit out a book, you know, every three minutes if it wanted to, and what the economics of that should actually look like.

54:31Well, Andrew, I think you raise a good point. And we're in a new area here, and this all has to be figured out. But I would say two things. Number one is copyright historically has applied to outputs, not to ingestion or learning. And so, you know, I think we have to consider that. The other is something that President Trump talked about, which is if you're going to require AI models to have a deal with every single article on the Internet, We're talking about millions of articles in order to use that. Then how is that going to be feasible from a common sense standpoint? You're just not going to make deals with every single one of those rights holders.

55:09And China won't care. China's just going to you know, they're going to suck in all the data. And so I think it will compromise our ability to win this race against China if they can use all the data. But we're hopelessly mired in in impractical contractual negotiation. David, real quick competition question. The president made a fascinating comment in his speech. He might have been talking to you about talking to you where he said he was asked about it. He was asking about NVIDIA. He didn't know what NVIDIA was. And somebody told him that basically they own 100 percent of the market. He wanted to actually break them up, he said.

55:41A, was that conversation with you? No, I wasn't. That was not. I was not part of that one. Was it wasn't you? The second related competition question, therefore, becomes, though, do you think we need a lot more competitors, both in chips and even in LLMs? I mean, one of the things we've started to see is because a lot of the big companies can't really, I think there's a view that regulators wouldn't allow combinations, that there's this whole acqui-hire trend. And I'm curious sort of where you land on the competition in the acqui-hire world. Well, I think what we're seeing right now is ferocious competition, especially at the AI model level.

56:14And I think that's good, and we want that to continue. At the chip level, it's true that Jensen has very high market share, but that's a result of him being so ahead of the curve on GPUs. I mean, he's been working on this for 30 years. When everyone else was focused on CPUs, he had this vision around GPUs. And so, you know, in America, we don't punish winning. You know, we don't punish success that comes from as a result of being visionary. And I do think, though, that NVIDIA, although they have high market share, they have a lead. But it's such a competitive industry still, the semiconductor business, that if they don't stay on top of their game, then they could lose to a number of companies that are challenging them, including startups.

56:53So I don't think we have a huge competition problem here. I think quite the contrary. These markets are very competitive. Hey, David, thank you very much for joining us today. David Sachs, we hope you come back. And that is Squawk Pod for today. You made it all the way to the end. Thank you so much for listening. Squawk Box is hosted by Joe Kernan, Becky Quick, and Andrew Ross Sorkin. Tune in weekday mornings on CNBC at 6 Eastern. To get the smartest takes and analysis from our TV show right into your ears, please follow Squawk Pod wherever you get your podcasts. We'll meet you right back here tomorrow.

57:32We are clear. Thanks, guys.