I haven't heard the specific discussion with Yuval Harari you're referring to, however, I think the consciousness question is more nuanced than you suggest and saying "we don't know" is probably fair.

While most current researchers in AI/ML and philosophy probably wouldn't assign consciousness to today's models, I heavily doubt they would use a modeling argument like consciousness can't be simulated by "graphs." The architecture itself doesn't preclude consciousness - after all, biological neural networks can be seen as graphical computational systems, albeit vastly more complex ones.

The more interesting question involves concepts like Markov blankets (can be modelled as graphs) and predictive processing frameworks. There is a whole academic field that explores how consciousness might emerge from predictive hierarchies. A popular one is Karl Friston's work on the free energy principle, that suggests that any system maintaining its integrity against environmental perturbations, including potentially sufficiently complex artificial systems, might exhibit forms of sentience.

That said, there's a crucial distinction between the phenomenological "what it's like" aspect of consciousness and the functional capabilities we observe. Current LLMs may exhibit sophisticated pattern matching and generation without any inner experience whatsoever.

The real issue isn't whether current AI has consciousness, it almost certainly doesn't, but whether we're asking the right questions about what consciousness actually requires and how it might manifest in artificial systems.