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DB Dean Baker Senior economist at the Center for Economic and Policy Research, dog lover, and new resident of Astoria, Oregon.

“So it has to come from outside of AI, just logically. I mean, I'm going to take it from my left pocket, put it in the right pocket, and get very rich that way. That doesn't work. … there's absolutely zero evidence it's the sort of sea change that the AI promoters are banking on. And unless it is, those stock prices don't make sense.”

The Tech Report · October 2026

“So it has to come from outside of AI, just logically. I mean, I'm going to take it from my left pocket, put it in the right pocket, and get very rich that way. That doesn't work. … there's absolutely zero evidence it's the sort of sea change that the AI promoters are banking on. And unless it is, those stock prices don't make sense.” — Dean Baker, The Tech Report

Context

The host cited a figure that a small share of AI users accounts for most AI spending. Baker adds that many of those big spenders are themselves AI companies, so real revenue has to come from the rest of the economy.

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Transcript

The Tech Report Around 23:33 into the episode
Dean Baker

…their stuff. So one of the stories, and again, I don't know how carefully people have the data on this, but I've seen several people making the point that 1% of AI users account for 50% of AI spending. And again, I won't vouch for that. I'm sure the general story is right. Is it 1% 50%? Is it 0.8%?

Speaker 3

I think on ramp in September, it was 1% accounts for 80%. That may have changed since, but it was 1% accounts for 80% of the spending.

Dean Baker

Yeah, so it's hugely disproportionate, a very small number of users. And an overwhelming majority of that 1% are other AI companies. So you go, okay, well, what are the other AI companies? Where are they going to get the revenue? So it has to come from outside of AI, just logically. I mean, I'm going to take it from my left pocket, put it in the right pocket, and get very rich that way. That doesn't work. So it has to be, again, I saw the Torce. And Slack piece, it has to be the other 493 of the SP 500. I mean, it has to have real uses for other companies. And clearly, it does, but it's not, there's absolutely zero evidence it's the sort of sea change that the AI promoters are banking on. And unless it is, those stock prices don't make sense.

Speaker 3

Well, Dean Baker, thanks for taking the time. Thanks

Dean Baker

a lot for having me on.

Speaker 3

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More from The Tech Report

“When you see 3.8% growth in consumption, that's clearly coming from stock gains. And if those stock gains go in reverse, we're going to see a big hit to consumption. So I don't think that's at all analogous.” — Dean Baker, The Tech Report “They're going to treat it like any other expense. You don't pay more for paper than you have to. So if one company's offering you paper for 10, 20% less than the other company, you switch to the one that's offering you cheaper paper and AI is going to be the same sort of deal.” — Dean Baker, The Tech Report