Winning the AI Race Part 2: Vice President JD Vance
Summary
- Vance expects deportations to accelerate after the “big beautiful bill” provided ICE more resources and after court wins, but says net immigration is the meaningful economic scorecard. He expects 2025 to produce the first net-negative immigration number in “50 or 60 years,” rejects amnesty and argues: “You don’t have to build an entire economy on illegal labor.”
- The administration’s core growth bet is to substitute automation and domestic productivity for imported cheap labor. Vance says America is underexposed to productivity-enhancing technology, while perhaps overindexed in software, and uses agricultural automation and the post-ATM increase in bank tellers as evidence that technology can change jobs without simply erasing them.
- On AI, Vance wants America to “plant our flag” against European-style safetyism while retaining consumer, privacy and anti-censorship safeguards. He argues excessive fear produces AI’s problems without its upside; the prize is jobs, productivity, more food from less land and a world built on “an American technology stack.”
- China is both benchmark and market: protect critical IP, sell American-made products and avoid turning competition into a substitute for building. Vance believes America still has the best hardware and software but cannot rest; he also described an ally’s undeveloped proposal for a NATO-like technology and security bloc outside Europe.
- The displacement risk Vance finds most troubling is the apparent contradiction between tech firms claiming worker shortages and a declining college-educated STEM employment rate. After Chamath pointed to big-tech layoffs alongside overseas visa applications, Vance said he had seen an article—possibly about Microsoft—involving, he thought, 9,000 layoffs, had learned of the issue only weeks earlier and “not yet had that conversation with Microsoft.”
- Vance says the administration is pursuing targeted public-private partnerships where America’s industrial or technology base is too strategic to atrophy. His model is 1940s–60s public-private partnership—private execution around discrete public goals such as basic research, weapons and the moon landing—with “a lot more” promised over the next three and a half years.
Deep dive
1. Net immigration—not deportation headlines—is Vance’s scorecard
Jason reopened his “sandwich” challenge: why had deportations not moved faster? Vance shared the right’s frustration but blamed court blocks and, until roughly a month earlier, inadequate ICE resources; the “big beautiful bill” and court wins should let the pace “increase a little bit.”
Vance rejected gross deportation comparisons with Biden because processing one illegal entrant out produces a plus one and minus one: “I’m not a math expert, but I’m pretty sure that’s zero.” He said he expected 2025 to produce the first net-negative immigration number in “50 or 60 years.”
Against warnings that enforcement would crash the economy, he said inflation had cooled and housing costs were showing signs of peaking; he believed Zillow showed 12-month housing-cost growth of 8%, versus a near-doubling of the average family’s mortgage cost under Biden.
Jason’s pushback—that enforcement’s “style” was aggressive, especially in Los Angeles, and that long-settled restaurant or farm workers might warrant compassion—met a hard line: “We’re not going to do amnesty.” Vance preferred automation for labor-short agriculture and countered that enforcing border laws is compassionate, citing what he called cartel trafficking, missing children and sex trafficking, as well as protection for people legally in the country.
2. America will embrace AI risk to capture AI upside
Vance framed his Paris speech as a chance to “plant our flag”: America was finished with overregulation and constant fear of the future. Europe’s anxiety, he argued, risked delivering “the worst of the problems without any of the benefits.”
His posture was not absolute. Consumer protection and data privacy still matter, and AI companies should not repeat what he called Big Tech’s 2020–21 combination of stealing people’s data and censoring a large swath of Americans for claims later shown to be true.
The positive case was expansive but specific: AI should create jobs and productivity, while agriculture could produce “a lot more food on a lot less land.” Vance contrasted technology-led growth with importing cheap labor, which he called “a dead end.”
3. China is the benchmark, but an ally floated an American technology bloc
Vance called China America’s largest economic competitor and said China’s technology industry is the one major competitor “knocking on the door,” especially in AI. America still leads in hardware and software, he said, but if the United States regulates itself to death and lets China catch up, blame belongs to “our own leaders” and their “stupid policies.”
Trade policy therefore requires a split screen: withhold certain critical technologies and the very best technology because of Chinese IP-theft concerns, while seeking access to China’s market for American-made goods. “We want to sell American-made products into China,” without surrendering critical intellectual property.
A small but strategically important ally had, just the prior week, proposed a NATO-like framework outside Europe, sharing access to an American technology stack and certain weaponry. Vance stressed that he had not discussed it with Trump. He contrasted the proposal with China’s “bag of money,” which he said can carry debt servitude and neocolonial control, and argued that regional allies should assume more responsibility for their own defense.
4. Automation may raise productivity, but hiring arithmetic worries Vance
Jason supplied the displacement case: each self-driving car could displace four drivers, while an Optimus or other humanoid robot might displace five or six factory jobs. Vance was more optimistic but not categorical: flatlining labor productivity suggests America is underexposed to technology—perhaps overindexed in software but underexposed to technology that boosts real productivity—and ATMs ultimately coincided with more bank tellers doing somewhat different, more productive and higher-paid work.
His newer concern is the apparent contradiction between technology firms claiming desperate labor shortages and a declining college-educated employment rate for STEM graduates. “That math worries me a bit”: after Chamath pointed to big-tech layoffs alongside overseas visa applications, Vance said he had seen an article—possibly about Microsoft—involving, he thought, 9,000 layoffs.
Vance stressed that he had learned of the issue only “a couple weeks ago,” was unsure whether Microsoft was the 9,000-worker example and had “not yet had that conversation with Microsoft.”
Chamath then broadened the discussion, arguing that the four-year degree path can leave people with $100,000 of debt and asking what should replace it during the AI transition. Vance agreed that the college system is broken; drawing on his Yale experience, he said universities should promote debate and “free thinking, even dangerous ideas,” rather than imposing severe social and employment costs for leaving the Overton window.
5. Strategic industries are bringing public-private partnership back
Chamath asked whether the Defense Department’s partnership with an American company that has a domestic rare-earth mine—intended to bring mining, manufacturing and the full supply chain into the United States—was a one-off or a model for AI and other national priorities. Vance answered that the administration is taking a “very discrete view” of core industries, technologies and weapons systems.
His precedent was the 1940s–60s: private industries handled what they did well, while government set discrete goals and facilitated basic research, otherwise-unprofitable weapons systems and the moon landing. Six months into the administration, he promised much more over the remaining three and a half years: America would no longer allow its industrial and technology base to “atrophy.”