An open letter to David Sacks
China is closing the gap, but it’s not because we have too much regulation on AI
David Sacks, until recently Trump’s Crypto and AI Czar, had this to say yesterday, using the current situation as an occasion to champion his favorite points on US primacy and minimally regulating AI:
This posted in response to a tweet by Commerce Secretary Howard Lutnick
The CAISI report is here.
While I don’t doubt the CAISI report per se, I am troubled by Sacks’ take, and wrote about it here:
As argued here a couple days ago, I think the US should at least consider pivoting and trying to work with China towards AI for global good, rather than creating a new cold war that is likely to an end in uncomfortable way for all, with no clear winners.
But that means less $ for Scam,Dario and Elmo. These guys dont give a shit about the global good or curing cancer or any of that. All they care about is where their next billion dollars is coming from. If they cared about the global good, they wouldnt be trying to put data centers on every piece of vacant land in America
Well written Gary. I guess as with Nuclear anti proliferation treaties, because AI is so central now to defense (per Ukraine & drone warfare) the devil will be in the details on how the US could get the other big world super power to see an advantage in cooperation vs straight out competition and trying to regain a small execution advantage.
Economically you could argue China has already won, because country wide industrial impregnation of very good (if not the best by a small margin) AI into everything they manufacture, is going to (or is) happening on a pervasive scale that the relatively expensive models in the US (needed for IPO success) prevent.
Then how will the ‘West’ compete. China already is the world’s manufacturer. They’re about to get stronger and because of the govt mandated backdoors in the AI model software, corporations in the US and Europe have to try and match Chinese corp’s with AI that is 10x as expensive - a structural disadvantage that is going to compound.
Sure, the SME’s will all brush off the data security risk and won’t be able to resists Kimi 3 inference at 10% of the cost of Claude, but listed US Corp’s are not going to be able to do that.
It’s a pretty significant challenge until open weight models (and harnesses, orchestration, tooling, memory) catch up. Or corporations go back to owning their own ‘metal’, training their own propriety models, which I guess drives demand for Nvidia chips even higher!
Unless the closed model expenses and non demonstrable ROU cause a drop in businesses use, and then we can lease back all those data centre capacity from Google / Microsoft etc at more interesting rates.