Angles of AI: Flexible Power, AI in Op-Eds, & Top Talent Moves 8/26/26

0:00Trading at Schwab is now powered by Ameritrade, bringing you an expanding library of education with even more ways to sharpen your trading skills. Access new online courses, insightful webcasts, articles, engaging videos, and more. All curated just for traders. Plus, guided learning paths with content designed to fit your unique interests. And no sifting to find exactly what you need, so you can spend your time learning to trade brilliantly. Learn more at schwab.com slash trading. Every day as a small business owner feels like solving a puzzle. One moment you're cruising along and the next there's a shipping snag that has you scrambling.

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1:15Oftentimes people like Stan Druckenmiller, who might write an op-ed in the journal, might hire a PR firm or a writer or a speechwriter to write the speech for them. So what's the difference between a speechwriter or a second person doing it or AI? Then former Labor Secretary Robert Reich joins us, and he's sharing his own concerns about AI. There are going to be major, major job losses, particularly not just in blue collar, but in white collar. But my second concern has to do with human beings losing control over AI. Plus, the economist's take on wealth taxes, tariffs and U.S. debt. Scott Besant may reject the notion of a K-shaped economy, but the fact of the matter is we do have a K-shaped economy.

2:00And finally, a conversation about flexible energy supply for data centers. CEO of Emerald AI, Varun Sivarum, had an idea. And the likes of NVIDIA, Samsung, and Salesforce have backed it. This is not a gimmick. There actually is. 100 gigawatts. Academic research shows us 100 gigawatts of available capacity if we can unlock it by making the data centers act in a different way. It is Wednesday, August 26, 2026, and Squawk Pod begins right now. Stand, Andrew, bye. In three, two, one, cue Andrew. Good morning and welcome back to Squawk Box right here on CNBC. We're live at the Nasdaq market site in Times Square.

2:43I'm Andrew Ross Sorkin, along with Joe Kernan. Becky's off today. White House is looking at imposing more trade penalties on Canada, including higher tariffs. This is a Bloomberg report that we're citing yesterday. Canada announced it's going to hit the U.S. with tariffs on$20 billion worth of U.S. goods. That's kind of a quid pro quo, if you remember that$20 billion number, because that matches President Trump's latest move. It's 5 % of the 900, whatever our trade is with Canada. And it's not nearly as much. It could ramp up and that could be a problem. But at this point, it's it's fairly it's a fairly small part of the U.S.

3:26economy, at least more so for the Canadian economy. The tariffs range from 15 percent to 50 percent. And they target things like dairy products, seafood and wood and paper products scheduled to take effect if you're waiting on September 18th. in a call with CNN yesterday. President Trump responded to a Canadian claim that the U.S. had made 11th hour demands in trade talks that caused the breakdown over the weekend. And the president said, that sounds like me. So I don't know, maybe that's a concession. In the meantime, we've got a warning coming this morning from Bill Gates regarding AI. The billionaire laying out his thoughts on AI in a new 12-page essay that he published on his website.

4:11Gates writes that the transition to AI will be marked by what he's describing as extreme turbulence and asks how the most vulnerable to AI's disruption can be protected. He says, in terms of equity, AI will either be the greatest equalizer ever invented or the worst source of injustice. The challenge is monumental. So Gates calls rising to that challenge the world's top priority, but faults leaders and experts for not planning ahead for a world that could contain far fewer jobs, he says, than exist today. He warns that AI could replace human relationships and empower people to do more harm. Though he also speaks of the upside of AI, including speeding up innovation in areas like health care and agriculture.

4:54Ultimately, Gates calls for designing a domestic and international framework for dealing with AI. And I think the quote of the day that's going to be taken away from the essay is, quote, there is no plan. And I think that is that is the question. Now, for the past couple of years, you've heard from people like Sam and Dario talking about potential job losses. And there's a whole view among others in the Valley that that it's not helpful to AI, that it's not right to be scaring people about AI. This is going to get sort of thrown into that. Somewhere in the middle, but I don't see how you can't be afraid of Bill Gates.

5:36I take with a grain of salt. I'm still really worried about, you know, being a big, huge tidal wave hitting me where I'm sitting right here in Times Square from climate change. And he kind of changed on that. So and he I don't not really impressed with. I know he's done a lot with, you know, trying to further human health, but there's certain things where he's lost his way in certain parts of vaccine. I don't know. Bill Gates, I take it with a grain of salt. I'm more interested in trying to talk to you about Dolly Parton because I'm so old. She was only 80 in tributes are pouring in because she looked the same.

6:20She never really changed, if you notice. And to lose someone shockingly like that. And you don't appreciate it. I didn't appreciate her until she's gone so many times. But my own personal remembrance is of a show that you probably have no idea about. Because I think it was in the 60s, Andrew. It was called The Porter-Wagoner Show. And it was like a syndicated. I have no idea. A syndicated. I thought of it as like a hick show from Nashville. It really was. And she started really as almost a sidekick doing a duet. And she wrote that amazing song that she's so well known for, the Whitney Houston cover.

6:56And she wrote that when she was trying to tell him, I'm leaving the Porter Wagner show after about six or seven years. And I'm no longer going to be just doing duets with you. I'm going out on my own. And she kind of wrote that for him. Apparently, I didn't know any of this. So I looked into it yesterday. And then you've got her 60-year marriage to this big, tall, handsome guy named Carl, who died last year. And it's always so sad when something like that happens. But I think now we're hearing something about that she had cancer or something. They have a tribute to pouring in from across the entertainment and business world for country music legend Dolly Parton died yesterday in Nashville.

7:35Her publicist said that the singer, as we just said, had faced a brief battle with cancer on social media. musicians including Mick Jagger, Reba McIntyre, Casey Musgraves, and Pink honored Parton, and many, many more did across all the cable networks. In New York City, the Empire State Building lit up in signature Parton Pink at 9.25 p.m. to honor the entertainer and her role in the film 9 to 5. Amazon founder Jeff Bezos weighed in on X, saying that Parton lifted Did everyone with her music, her generosity and her joy. Apple CEO Tim Cook said Parton's music helped light up the world. On true social, President Trump said U.S.

8:20flags would be lowered to half staff for a week. Parton, as you know, is known for her self-deprecating wit as well as her immense song production. Thousands of songs, apparently, but also for her philanthropy, promoting child literacy. She was 80 years old. And a couple other things, Andrew. I guess this song, Elvis was going to record, I will always say. And she wanted Elvis, wanted him, was so honored that he was going to record it. But his hard-ass manager, Colonel Tom, whatever his name was, wanted 50 % of the publishing rights for this song for him to record it. She said no. So later, she said that when Whitney did that cover, she made$10 million in royalties after Whitney Houston.

9:12And was able to buy Graceland with, or could have bought Graceland with the money. So she was a smart businesswoman as well, obviously. And an entrepreneur. And an extraordinary performer. An extraordinary person. People loved her. I was going to mention, you mentioned Jeff Bezos making a comment about her. he had donated$100 million to her for her to then donate to the rest of the world. He has something called the Courage and Civility Award, where he gives out$100 million to somebody every year. And there, they have to then give the money to somebody else. See, Buffett, you know, since the aforementioned Bill Gates isn't going to get any more Buffett's money, maybe this is an idea for, you know, the Dolly Parton.

9:54because she still has foundations that are involved in all kinds of things. Bringing it all back, full circle, back to what we were talking about before. I know you'd like that. Investing legend Stan Druckenmiller made waves with his Wall Street Journal op-ed criticizing the Treasury Department for announcing it will upsize the size of bond buybacks or just criticizing the whole idea even before they upsize it. Some pointed out that Druckenmiller's op-ed appeared to be written with the help of AI and Druckenmiller confirmed to the journal that that was the case. He noted he and his colleagues and in his family office all use the major AI tools, including for writing.

10:34Druckenmiller said, in his words, at 73, I'm kind of proud of using it. In an article, the journal's editorial page editor said, the question for us is whether what we publish from contributors reflects an author's original argument And if the author has the standing and credibility to make it, what's amazing is there's a way you can look at something. And I read yesterday four or five programs that will tell you whether there are all the earmarks of AI, which could only be based on it's so good and it's so much better than what a human could churn out. It's got to be AI, which brings us back to the scary Bill Gates thing, because AI can do things better than us.

11:18Now, here's the one thing. Now, my the way I think, strunk and white elements of style, the fewest number of words. Yeah, I know. Practice what you preach. If you can be the brevity and say everything you want to say in the most elegant way, that's that's that's the way you do it. And A.I. is able to do that. Here's the quote yesterday that I think I read yesterday. Yesterday, let's say you want to say that the bond market is the governor for everything that Congress is bad at. And every basis point of artificial yield suppression is a subsidy to procrastination. That's 11 words. And it would take you paragraphs to say that.

11:59Would you not want our writers at this place to use AI? Are you telling me you wouldn't like that? So, first of all, I find this whole conversation fascinating. I'll say two things that I think are important. I fear that this debate over his use of AI, which I don't have a problem with, is overshadowing or taking away from the actual merits of what I thought was a very smart essay about what's happening in the bond market. I think it made it better. It made it easier to understand what he was saying. No, no, no. I'm not saying the AI. No, no. You think because people were talking about this. Yeah.

12:40The idea that there's a distraction taking place. No, no. There are people who are, frankly, in the maybe in the Treasury camp or other or others who are now using this to point away from the actual merits of the debate. Right. That he's using. OK. OK, so then the question becomes, but I think there's a real question about. So, like, I'm a writer. Right. Technically. Right. Supposedly a professional writer. I'm not a good writer. I am not using A.I. I use A.I. all the time. You're really good at that. But thank you. But and then there's a question of whether the public expects certain people to use their hands on the keyboard or not.

13:24And I think about this all the time. And it's a changing world. I don't know. It's a changing world. And so you said, you know, it's interesting. I think about an artist like Koons or Andy Warhol, who have effectively built factories where other people are doing their art, creating some of the beautiful art that they come up in their head with. What if you love a new band? What about the silly actress that's AI? People are going to, I mean, it's very hard to get there. These are the questions. However, in this case, I would say, you know, the other piece of this is oftentimes people like like a Stan Druckenmiller who might write an op-ed in the journal might hire a PR firm or somebody or a writer or a speech writer to write the speech for them.

14:08So what's the difference between a speech writer or a second person doing it? Or I'm assuming that James Patterson, by the way, in the future, who, you know, famously writes these exhaustive outlines and then hands it to a writing partner who then the writing partner goes off and writes it. You know, in the future, it might just the writing partner could be clawed. And how are we supposed to think about that? And also, does it matter who the person is? So Stan Druckenmiller is in the business world and is writing an op-ed. And maybe you think about it differently. If you hired an artist and told them to paint a drawing of Times Square for you and then you found out that they painted it in two minutes using AI, you might think differently.

14:50So these are the things that I think we haven't come to sort of grips with. When I read the piece yesterday, I thought it was both brilliant conceptually. I thought that I will tell you that good. Well, I thought there were a couple of sentences that I thought, OK, that that seems a little AI ish, but it didn't it didn't throw me. But I would say within the media and journalism circles and sort of writing circles, the idea that the journal, in this case, defended the publication, some people looked at it as a real watershed. Because, you know, even the policy at the journal has been not to use AI in the context of writing, using it for research.

15:28But we're talking op-ed here. And I thought the same thing. Maybe they don't want their front page reporters, you know, turning in AI stuff. But Druckenmiller, it's a different thing. But as you said, he's at a point where the credibility is so huge that he wants to get something out. The gist of what he wants to say is more important. Right. And you put his name on it and it's his it's his work. I don't look at that in an untoward way. Well, I just wonder what it means long term. And by the way, think about this one. Here we are talking about A.I. writing the piece. what happens when our AI agent is reading all the pieces?

16:08So we're going to have AI write things for us, and then some agent is going to read it for us, and we're going to be taken out of all of it. Last point, how much do you think not writing for the next generation is going to mean that their brains, our brains, are going to be less sharp? Well, you heard another analogy Stan used. yesterday was, you know, you think I'm doing long division by hand? Right. No, he uses a calculator. He uses a calculator. So the question is, did the calculator or like Google Maps make us? Did you take I knew how to do an integral calculator? And have I ever used it? No.

16:49Did it help me because I had to work so hard to get to the point where I understood it? Yeah, I think it did. And I I think there is a lot of things that aren't as rigorous as they were because of the calculator. So that's a question. I know. And does that make us a lesser. Does it make us less? And I don't know. That sort of, that gets at some of the Bill Gates stuff this morning, actually. Well, me like watching, you know, TV and Squawk Box, so I don't think it's affecting anyone at this point. Do you? Yeah. It's like, yeah, what's the... Yeah, we're all going to be, we're going to be total feebs at some point.

17:23Have our robots doing everything for us. Another high-profile departure at OpenAI. The Wall Street Journal reporting the company's head of data centers, Chris Malone, left last week. Malone joined OpenAI in March of last year. And in recent weeks, the company has now seen its chief revenue and chief operating officer leave. Top executive, Fiji SEMO, also, of course, departed the company for health reasons earlier in the year. Maybe I should say late last year. So questions about some of the executive ranks. We talked to Greg Brockman, the CEO, co-founder, I should say, of OpenAI and asked him about all this.

17:58And he really argued that what's happening at OpenAI right now in terms of some of these management changes we're seeing is for a different era of the company, especially as they start to think about moving into becoming a publicly traded company. That's something that could happen as early as this year, but more likely in 2027 after we see Anthropics IPO, which we're expecting to see in the next couple of months. Cheese will be next. Coming up on Squawk Pod, economist, author and former labor Secretary under President Bill Clinton, Robert Reich. The political reality today that the strongest forces in American politics are a kind of, well, they're populism.

18:42They're a kind of anti-establishment, anti-elitism. A conversation spanning U.S. debt, AI, jobs, wealth taxes, and so much more right after this break. Trading at Schwab is now powered by Ameritrade, bringing you an expanding library of education with even more ways to sharpen your trading skills. Access new online courses, insightful webcasts, articles, engaging videos, and more. All curated just for traders. Plus, guided learning paths with content designed to fit your unique interests. And no sifting to find exactly what you need, so you can spend your time learning to trade brilliantly. Learn more at schwab.com slash trading.

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20:21Welcome back to Squawk Pod with Joe Kernan and Andrew Ross-Orkin. Here's Andrew. Canada announcing retaliatory tariffs of up to 50 percent on$20 billion worth of U.S. imports and an escalation of the growing trade war between the two countries. Joining us right now to talk about all this, former Labor Secretary Robert Richie's UC Berkeley emeritus professor of public policy. Latest book coming up short, A Memoir of My America, is out in paperback this week. We've got to talk about so much. The trade war, wealth taxes, A.I., I want to hit everything. We haven't got a chance to talk to you in a long time, Mr.

20:56Secretary. So help us understand just your sense first of the trade war with Canada and whether you think. How damaging do you think this trade war is going to be for the U.S.? How much how damaging do you think it is for Canada? I think it's very damaging for both sides. Trade wars are very bad. They're bad for the economy. They're bad for American workers. They're bad for American consumers. They're bad for Canada. And to have a trade war with Canada, you know, if this were a joke, if this were sort of a Mel Brooks movie, that would be one thing. But it's not a joke. I think our president is simply lashing out because he wants to show dominance.

21:40He feels so trapped in Iran. He feels so trapped by so many forces that are now working against him that Canada is just an easy, easy mark for a bully. And that's what bullies do. They look for easy marks. What do you think the true economic implications are for us? Or do you think there's something else that's broader? I think the economic implications are rising prices. What I really, really worry about is home prices. You know, we have a housing sector that is already in trouble. And as Canadian wood products become even more expensive, forest products, you're going to see housing becoming, again, even more of a basket case.

22:29Add in the long-term treasuries, the effect on mortgage rates. Well, this is this is a major important sector of the economy that is a particular problem for young people trying to get into housing, into the housing market. I see this, the Canadian war, trade war as just irrational, completely and totally irrational. Let me ask you a question about affordability, because I think that's the watchword of the moment. It's the watchword politically of the moment. There's a whole bunch of folks, including the mayor of this city, that have successfully campaigned on affordability. And yet a lot of the approaches that have been discussed have included things like freezing rents, creating new supermarkets and things like that.

23:24And haven't, I would argue, focused on the supply part of the affordability problem. If you were to be able to solve the affordability problem in America, whatever you think that even is, how would you do it? Well, I would not do it with a trade war. I would not do it with tariffs. I would not do it with a major war in the Middle East. I think all of these things are actually making consumers more desperate and everything less affordable. I think the way you deal with the trade war is you stop it. The way you deal with the affordability crisis is to give consumers a little bit better deal. One of the biggest things that government can do and should be doing is to get the price of health care down.

24:11Now, for years, Andrew, we have talked about single payer. We've talked about Medicare for all. We know how much complete fraud and And and and and spending that is unnecessary is part of our health care system. Well, that would be one major, major place that I would go to even before I go to trying to end trade wars and deal with real wars in the Middle East. Let me ask you, we've been talking a lot about California recently and the big debate over wealth taxes. I follow you and a lot of things you say online and elsewhere. I'm curious about what you think is going to happen in that case, whether you think that the wealth tax is going to go through.

24:58But what do you think it means more broadly for the United States if it does? Well, Andrew, the background of almost everything we're talking about is the political reality today that the strongest forces in American politics are a kind of, well, they're populism. They're a kind of anti-establishment, anti-elitism. And a lot of that is being driven by the K-shaped economy. I don't care what Scott Besson says. We do have a K-shaped economy. Inequality is widening. Inequality of income and wealth. And that, you know, people understand. People, Americans don't, are not stupid. They know that more and more of the nation's wealth is being held in fewer and fewer hands.

25:44And so a wealth tax appeals to most people. Most of the polls show everybody is in favor of a wealth tax. I think in California, you know, I don't know whether we're going to get it because the governor, for I think political reasons, doesn't want to push on a wealth tax. And I say political reasons. I don't want to impugn his integrity. But I think that there is a lot of resistance in some reaches of the Democratic Party and obviously the Republican Party, because wealthy people are the funders of campaigns. gains. But the fact of the matter is that a wealth tax is very popular. It is it is we are going to see it inevitably.

26:24And in fiscal terms, in terms of balancing our budget or coming even halfway close to dealing with a 40 trillion dollar budget hole, we're going to have to raise taxes on the wealthy. But let me ask you this on the wealth tax itself, because I think there's a philosophical question, at least I have the question, about taxing unrealized gains. Meaning, I think there's a meaningful conversation to be had about, A, getting rid of all the loopholes, people who are taking loans against their stock, step-up basis at death, carried interest, 1031s. By the way, capital gains unto themselves. In an AI age, when we think about labor versus capital, I could I could make, I think, a fair argument that those rates could go up.

27:14I think the idea of taxing unrealized gains is actually a much bigger issue. No, I do. I agree with you completely. And I think it's a huge issue. And I think because we are now in an economy in which capital gains are really at the centerpiece of the division between the wealthy and the poor and the not so wealthy, The capital gains are going to be really in the crosshairs of of what everybody is going to be talking about when and if Democrats gain the majority in Congress. But I also think on the table ought to be getting rid of the stepped up basis at death rule, which I think, you know, if you don't like a wealth tax, then I think the next best alternative in terms of dealing with capital gains and also dealing with widening inequality is getting rid of the stepped up basis at death rule.