AI Replacing White Collar Jobs? & Airlines Upcharge Solo Travelers
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Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, airlines got exposed for charging solo travelers more than groups for the same exact ticket. Ben, is AI really going to take your job? One major CEO certainly thinks so. It's Monday, June 2nd. Let's ride.

Good morning and welcome back to the week. Apparently, the 1% are not feeling 100%. A new report from CNBC stated that rentals in the Hamptons this summer are down nearly a third from the same period in the last few years. The picture is even bleaker at the ultra high end of the market, where the Hamptons rental business is down between 5% and 6%.

50% and 75%. The lower demand has prompted some listings to lower their prices by 10 to 20% to save their summer. Toby, either this is a sign of economic uncertainty or everyone is finally realizing the Jersey Shore is just better.

Or you put on your meteorologist hat and realize that it's been cold and rainy in May, so maybe people are just delaying their vacations a little bit. I tend to think that maybe it also could be a recession indicator, though, because the demand is just simply not there. And if you zoom out to the broader second home market, homebuyers took out just $86

thousand mortgages for second homes last year per Redfin. That is down 66% from the pandemic home buying peak. It was the lowest since 2018. So yes, you can bust out the world's tiniest violin for these one percenters, but also possibly a recession indicator if the wealthiest are clamming up and holding onto their cash a little bit more.

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Anthropic CEO Dario Amadei recently warned that an AI job apocalypse is coming. He didn't use those words exactly, but he may as well have because according to an interview with Axios, Amadei thinks AI could eliminate up to half of all entry-level white-collar jobs and push unemployment as high as 20% within five years, a scenario he says the government and tech leaders are dangerously underestimating.

He believes most Americans don't grasp how fast AI capabilities are accelerating, especially agentic AI that can replace humans across white-collar fields like law, finance, and tech. And by the time they do, it may be too late. Now, the irony here is that Anthropic just released a new, wildly powerful model called Claude Opus 4, which threatened to blackmail an engineer. So he is pushing forward the very technology he is sounding off about. Amadei does acknowledge AI's massive opportunities.

upside from curing cancer to potentially supercharging economic growth, but he also foresees a world where too few people can contribute economically, creating deepening inequality and even undermining democracy. His call to action, stop sugarcoating the AI revolution, warn the public, educate workers, and explore policies like an AI usage tax,

before the coming job disruption becomes irreversible. Neil, this interview generated a lot of headlines over the weekend, and rightfully so, though some pushed back saying it was mostly just the AI hype cycle at work. But if you are looking for warning signs of an AI job apocalypse, especially for those entry-level roles, you can find...

Find them. Just look at the jobless rate right now for those for people just coming out of college ages 22 to 27 with a bachelor's degree. The unemployment rate was close to 6 percent in April. Very unusually high compared to just over 4 percent for the overall workforce. We've seen some interesting layoff announcements recently.

Related to AI, Microsoft laid off 6,000 workers, about 30% of the company. Many of those engineers crowdstriked that big cybersecurity company, slash 5% of its workforce, citing a market and technology inflection point with AI reshaping every industry. A LinkedIn executive wrote an op.

saying, I see the bottom rung of the career ladder breaking. So there's a number of voices now and a number of data points you could point to, obviously, that don't show an AI job apocalypse or 50% of the entry-level workforce being wiped out. But there are some crumbs here. Yeah, Amadei didn't actually cite any research or evidence for that 50% number, but it did make a lot of headlines. Here's how he kind of sees it going down. Right now, obviously, these companies are in

improving their large language models at a pretty rapid rate. This is happening and it's only getting faster. And the U.S. government is not necessarily doing anything. It's a little bit of sleep at the wheel because, one, it doesn't want to lose to China in this AI race. And so they don't necessarily want to throttle an industry, especially when we're in competition with China. So they don't pass any regulations whatsoever.

uh, about AI or even cautioning the American public. So most Americans just go about their days generating their little images with AIs, but pay little attention to what is actually going on and how they might be replaced. And so then potentially overnight, this flip has been switched and

all of these companies who have been working on this in the background starts to replace humans, start to reap those cost-saving benefits. And they don't backfill new ones. They don't start hiring any new roles. And that's where this AI apocalypse comes from. Now, the flip side here is that we've gone through multiple technological revolutions before that have...

hypothetically replace a lot of workers, but usually it leads to more job creation. I mean, Mark Cuban said we used to have hundreds of thousands of secretaries and typists in offices. Now we don't have that anymore. So there is a flip side to this argument, but you see where kind of this fear is coming from from Amadei. Yeah, and the argument on that argument is that all of those technological revolutions took decades to create.

pan out, in which case the workforce could be retrained in those new technologies. So you got rid of typists, but they learned how to code. And that took decades. He is warning that this AI job apocalypse will happen in one to five years, which is far too fast for everyone to get up to speed and learn these new technologies or be employed in new jobs that are created as a result of that. And then let's talk about one of his policy ideas that Amadei floated, which is this idea of a token tax, which is

Every time someone uses a model, you actually tax 3% of that revenue and goes towards the government to be redistributed in some way. He said, obviously, this is not in my own economic interest because he runs a big AI company in Anthropic, but he does think that that's a good step for a government to take to potentially have some buffer for the citizens of countries rather than just having it all

we take your job away and reap the benefits economically. So this token tax is maybe something that you'll start to see tossed around a little bit more on Capitol Hill and potentially in other countries as well. President Trump must have watched a lot of TikTok in 2021 because he is doubling it and passing it to the next person.

On Friday, the president said he would increase tariffs on steel and aluminum imports to 50%, up from 25% currently. He said these higher tariff rates would go into effect this Wednesday and effectively create a fence around U.S. producers in order to protect them from cheaper metals flowing in from other countries.

At 25%, they can sort of get over that fence, he said. At 50%, they can no longer get over the fence. And the U.S.'s trading partners were not happy to hear about this fence, warning of mutually assured economic destruction if it were to go up. The steel industry in Canada, which is the top metal supplier to America following decades of integration, predicted, quote, catastrophic job losses,

from factory slowdowns due to the tariffs. The EU also blasted the doubling move, saying it undermines ongoing trade negotiations and only ratchets up the uncertainty facing businesses. Now, it's worth noting that the tariff announcement didn't come from a truth social post per usual, but from a place far more symbolic, a U.S. steel facility near Pittsburgh.

Trump was touting a, quote, partnership between Nippon and U.S. Steel that would see the Japanese giant inject $14 billion into the fading American icon to save it from irrelevance. However, the specifics of that deal remain uncertain and nothing has been finalized yet, including crucial details like the governance structure of a U.S. Steel subsidiary. Yeah, so what's the goal here? The goal is to increase U.S. production of steel and aluminum, ensure tariffs

could do this. They could boost job creation demand for U.S. steel. But if you reduce foreign imports of steel basically to zero from places like Canada, that is going to lead to a lot of headaches downstream of the actual steel industry. Think

industries like automakers or even consumer packaged goods who use cans and aluminum like Pepsi or Coca-Cola to create and package their beverages. So now you're talking about supply chain disruptions, but then you're also talking about higher prices for consumers, which is why a lot of people are saying this is probably not the most economically sound policy. And then you look at the fact that most U.S. steel factories, the ones that are modern and cost effective are already in use. So where is the

extra, you know, production going to come from. That might mean re-putting into circulation factories that have been sitting idle, that weren't necessarily super efficient. That is not a quick process whatsoever. So just because you threatened this levy doesn't

necessarily mean it magically fixes the steel industry. Let's talk about the Nippon U.S. Steel acquisition merger, planned partnership, whatever you want to call it. Some details have emerged about what this will look like. Let's do a quick rewind. Remember, Nippon is the Japanese giant, third largest steel company in the world. It's wanted to buy

U.S. steal for $14 billion, and it was blocked by Biden. It was blocked by Trump. And then in recent months, it seems like there had been some thawing from the Trump administration opposition to this deal. And now it looks like he's blessing this merger. It looks like they're going to do some

governance maneuvering in order to get those national security concerns squashed. There might be an American CEO of U.S. Steel, a U.S. majority board, and what's known as a golden share, which grants the U.S. government veto power over certain corporate functions and board appointments, which would be a very unusual arrangement to have the U.S. government be all in this company's business in a way that

know many other countries are like europe and china but it's not necessarily a level of government intervention that we have had historically here in the united states and some people say okay well maybe if we're doing the golden chair with us steel maybe that's potentially what we could do with tick tock in order to get uh china's bite dance to divest from it or at least

have some sort of arrangement where the US government has a stake, the Chinese government has a stake, ByteDance has a stake. So perhaps it's this model for TikTok if this thing works. I knew you had a callback to the TikTok reference at the beginning of your segment. I was really smart that you set that all up.

It's time to let your dream of solo traveling Europe die because airlines seem to have it out for you lone warriors. Last week, the executive editor of a travel website was booking flights for a trip he was taking with his wife when he came across something strange. When he looked at Delta flights for one person, the price was $206. But if he booked for him and his wife together, the price went down to $154 each.

That sent him and his team at the Thrifty Traveler down a rabbit hole where they looked at hundreds of different fares on multiple different airlines and found that Delta, United, and American Air were all pulling the same trick. Now, before you go calling up your ex to try and find a new travel buddy, these findings aren't universal and you won't see fare discrepancies on every route. Still, when you do stumble upon a route that does charge extra, it can be up to 70% more if you buy a ticket for just yourself.

Aviation writer John NYC says the reason why airlines are testing this approach is to try and extract more value out of deep-pocketed business travelers who tend to fly solo compared to recreational travelers who tend to fly in groups and pay less per ticket. But the increased media attention on this pricing strategy seems to have worked, and Thrifty Traveler claims that Delta and United have both nixed fares

That charged solo travelers a premium. Neil, do you want to be my travel buddy? Let's do it because we could save a lot of money, at least under the previous scheme. I mean, they found this one flight, American Airlines flight from Charlotte to Fort Myers on October 13th, which could be a nice golf weekend. Traveling solo, you'll pay at least $422 for this one-way flight. And then when you search for two passengers, the ticket cost drops to just $422.

$266 per person. So that is a huge either discount for group travel or a premium for solo travel. And what these analysts say is it is actually not a discount. It is a huge price hike for solo travelers because they are just using solo travelers as a proxy for business travelers who are paying on their company's dime. And this is what airlines have done for a long time, which is segment their customer base based on what you're willing to pay and then charge you what you're willing to pay. What?

the rollback announcement was celebrated by Thrifty Traveler as this big victory like hey we found this idiosyncrasy but now Delta United have stopped punishing solo travelers but actually if you dig into the data the exact inverse happened instead of

reducing the solo traveler price to meet the group rate. They actually just raised the group prices up to the solo traveler. So the exact inverse became true where they brought all this media attention to it and airlines like, all right, we were trying to give, you know, these recreational people a little bit of a discount, but now we're just going to charge everyone the same thing. So now everyone pays more. So perhaps the more accurate reality of the situation is after this blowback, they just start charging everyone.

everyone more rather than one group more than the other. So it is a little bit unfortunate that this was maybe the downstream effect of this. Again, they are saying that this is not an exhaustive measure. Like they were kind of just manually Googling a lot of these flights and seeing where the discrepancies lie. And so there could still be discrepancies on other routes and other airlines. But yeah, kind of an interesting bit of airline pricing psychology that thrifty traveler discovered over the past few days.

Up next, let's talk about our winners of the weekend. If you're taking your business abroad, make sure your finances are ready to go global with Wise Business. Wise Business is the account for doing business in other currencies. Wise Business accounts have the tools you need to do business abroad. Process payments get paid and manage your money from anywhere around the world. And Wise Business doesn't break the bank.

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Let's bring you our winners of the weekend, the segment where Toby and I pick two things that lived, laughed, loved these past few days. I won the pre-show Sunday night meal prep contest because I actually did it. So I get to go first. And my winner is Taylor Swift. Yeah, haven't heard that name on the pod in a while. And that's because the superstar has bought back all of her original recordings.

In what Variety called one of the more dramatic business developments in pop music history, Swift said she had acquired her first six albums from investment firm Shamrock Capital. In a long handwritten note to fans, Swift gushed about her newfound ownership and said, to say this is my greatest dream come true is actually being pretty reserved about it.

It marks the happy ending to a years-long saga that's captivated the music industry and millions of Swifties worldwide. Back in 2019, Swift's catalog was sold as part of a larger deal to music manager Scooter Braun's Ithaca Holdings, who later sold it to Shamrock.

At the time, Swift railed against the deal and highlighted the shocking fact that recording artists often don't own their masters or original sound recordings, which limits their ability to profit off of their work. The loss of her masters spurred Swift to re-record her first six albums as Taylor's version she would completely own, four of which have been released so far to wildly successful sales. In response to the news, Scooter Braun offered a short statement, I'm happy for her. Yeah.

Scooter Braun is probably happy to just not have the target on his back anymore here. This was part a financial victory for Swift and also part just a symbolic victory. She's obviously been fighting for these for a long time, but it does seem like everyone involved here made a lot of money because you look at Scooter Braun's Ithaca Holdings. It made a pretty penny when it sold the catalog to it.

to Shamrock for $300 million. And then Shamrock probably were estimated to turn a profit around $100 million in the brief time that it owned Taylor Swift's catalog. And then even Taylor Swift herself, even though she didn't own those rights, re-recorded and labeled them Taylor's version. And a lot of those recordings actually ended up

out streaming and outperforming the original album. So there was a lot of money being passed along here, even though Swift is not necessarily in this specifically for the money, though it's not going to hurt. Yeah. So a lot of people are probably happy about this saga coming to an end with Taylor Swift owning all of those first six albums. But if you were someone who was eagerly anticipating a reputation, Taylor's version, which was supposed to be the next rerecorded

out of the six, there's just two left, you might have to wait because she doesn't have so much of an incentive to make this album anymore. I mean, honestly, if she does release it, people will listen and go crazy about it. But I guess the...

The urgency for her to record this is not so much anymore because now she owns the original one. And she also just said that that time in my life was so different than where I'm at now that it just doesn't even feel right. And I keep trying to record it and improve upon it. And I can't even do that. It is a perfect album. It is. Well, I don't know if it's a perfect album. It's just a very specific time. Some might call it an era of her life that she doesn't necessarily want to go back to.

My winner of the weekend are inconsistencies in the U.S. tax code because they could decide who wins the Stanley Cup. The Edmonton Oilers and the Florida Panthers are the two final teams left vying for the Stanley Cup this season. And while hockey fans are no doubt clued into storylines like Connor McDavid looking to win his first cup or the Florida Panthers going back to back, CPAs are looking at another angle, state income tax.

There are six U.S. states with no income tax and six NHL teams located between them. They include the Tampa Bay Lightning, Vegas Golden Knights, and Dallas Stars, and the Florida Panthers, all perennial contenders. In fact, the last time an NHL market without state income tax didn't produce a Stanley Cup finalist was all the way back in 2019. As the offseason looms and free agents look to sign for different teams, some in the league are muttering that these tax laws

are granting outsized advantages or disadvantages if you're a Canadian team whose players pay the highest tax rates in the league when it comes to pursuing free agents. You can't blame players for going south, lured by good weather and great taxes, but it doesn't lead to a financially level playing field or rink, as shown by the dominance of no-tax teams in recent years. It's certainly true that this no-tax situation is...

messing with the free agency market. I mean, this all past offseason, Sam Reinhart re-signed with the Florida Panthers, which won the Stanley Cup last year for $69 million. The Rangers or Islanders in New York would have had to, according to sports agents,

would have had to offer a contract exceeding $88 million to net out the same amount for Reinhardt's $69 million contract with the Panthers because he's not paying any taxes on that and he's going to pay a ton of taxes if he lives in New York. So certainly it's been a point of discussion about whether any sort of policy changes need to come in at the top level of the NHL to level the playing field between high tax states and low tax states. However, I think

think it's only because these teams are good now the lightning and the panthers i mean if you go back two decades those teams were really bad and no one was grumbling about the low state income tax you don't really hear it so much in other sports as well where there's just maybe parody i think we're just living through an era right now of the past six years where a ton of these teams from the south and the west with no state income taxes are doing well and that has sort of brought this conversation to the fore but it's interesting nonetheless yeah

And the NHL specifically is interesting because a third of its members are in Canada, which has vastly different tax laws and rates than the U.S. itself. So maybe that is another reason why the NHL always seems to find itself in these interesting economic and even international conversations about what is fair and how tax laws should work when it comes to sports. I mean, this is a tale as old as time. It is not specific to hockey. We're all the richest people buying houses right now. I mean, Florida.

All right, it's Monday. You're planning out the week ahead. So here's a preview of the major events to put on your calendar. With earnings season wrapped up, investors will turn their attention to the May jobs report out on Friday. Companies are expected to have kept hiring at a healthy clip.

with projections of 130,000 jobs added last month, though that'd be down from 177,000 created in April. May was the first full month of employment data with Liberation Day tariffs in effect, so economists will be looking for clues on how different types of businesses have been dealing with those extra costs. Yeah, and we'll get a little bit of a preview of where Jerome Powell's attitude is too, because he's due to speak today after meeting with President Trump. He's obviously argued that

or their presidents argue that the Fed should cut interest rates. Fed said, no, we're going to wait and see, and then we're going to get the jobs data later in the week to just really see some crystallized data about how things are shaken out when it comes to tariffs. It's a busy week on this sports calendar. The NBA finals begin on Thursday. The juggernaut Oklahoma City Thunder will face the Indiana Pacers in a matchup of small market teams that have never won a championship before. I mean...

The NBA went from Timothee Chalamet and Kylie Jenner to Dale from Fort Wayne, Indiana, sitting courtside. I am sure they are thrilled about the earnings or the television ratings that are probably not going to be as high as if the New York Knicks made it to the finals. It may not be, but if they're good basketball games, we'll watch. And Dale is probably part of that stealthy wealthy who's just raked it in from his local regional business and is now in the 0.1%.

You know, making as much as Timmy, maybe. Okay, and the field at the French Open will be narrowed down this week until the women's and men's winners are crowned on Saturday and Sunday. Yeah, the Americans are doing all right. Tommy Paul and Francis Tiafoe became the first American men to reach the quarterfinals since 2003. That is Andre Agassi days. By the way, eight different American women have made it 23...

the quarterfinal appearances since 2003. So I guess the men are finally catching up. Yeah, the women are doing better on the clay. And then finally on Sunday, all your theater kid friends will be watching the Tony Awards and they've got plenty of reason to throw jazz hands. The 2024-2025 season is the highest grossing in history with its $1.89 billion in ticket sales topping the previous mark

Yeah, it's easy to point to George Clooney and that record run that Good Night and Good Luck recently had, but it's also just a

very top to bottom strong slate. They aren't necessarily relying too heavily on regurgitations of past IP of just recreating a movie or something on Broadway like maybe they've done in the past a little bit. They just have a lot of

good shows out here and people are turning out to Broadway. And if you're excited for the show, you can get even more excited because the Hamilton original Hamilton cast will be performing for the 10th anniversary of that show. Also, Neil, I don't want to steal your thunder here, but can I add a

One more thing to the week ahead. You're allowed. Thank you. Morning Brew Daily Trivia is going down tomorrow in New York City. If you were one of the lucky ones to sign up, check your email. We cannot wait to see you tomorrow evening. If you missed out, no worries. We'll bring you a sampling of a few questions on Wednesday to see how you would have done. You definitely would have won if you were in person. But yes, excited for this.

Can't wait to see and meet some of you all in person. - That is all the time we have. Thanks so much for starting your morning with us and have a great start to the week. If you have any thoughts on today's episode, send an email with questions, comments, or feedback to [email protected].

Let's roll the credits. Emily Milliron is our executive producer. Raymond Liu is our producer. Our associate producers are Olivia Graham and Olivia Lake. Hair and Makeup just signed with a Florida-based podcast. Honestly, savvy financial decision. Devin Emery is our president, and our show is a production of Morning Brew. Great show today, Neil. Let's run it back tomorrow.

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Let's roll.

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