There is certainly techno-feudalism but I don't think it's limited to tech. Private equity has stake in many non-technical companies and their approach is a rent seeking behavior as well. I think it may be reasonable to suggest that techno-feudalism arises from the concept of shareholder primacy.
What the theory essentially says is the shareholder takes on the most risk by risking capital (bullshit) and as such they should be the only party of concern for an executive suite. The concerns of employees, suppliers, nearby residents, government, etc. don't matter. If the shareholder is the primary concern due to capital risk, the largest shareholder is the most "important" shareholder. It's effectively ranking people by how much financial capital they already have.
The result is increasingly externalizing risk from the largest stakeholder down through to non-shareholders and internalizing reward toward the largest shareholder. Is it a fundamental driver of inequality, it's built into the theory, and at the moment it is the primary theory driving most large organizations if not all.
I don't think what we have now is actual capitalism. The actual origin of capitalism prior to its modern definition was the Dutch at the beginning of their rise. The offer proportionate reward for proportionate risk taken where all were able to be included in ownership of both ships and goods on the ships. This lead to broadly improved ability to take on higher risk, higher reward activities that would otherwise have been infeasible. It wasn't rents extraction.
I appreciate the mention, the tulip mania was about 250 years post rise of the Dutch.
The tulip mania was a key indication of issues with understanding why their system worked in the first place. What was gained by trading with India, so far from the Netherlands, was myriad goods and other forms of knowledge useful broadly within the economy. Tulips were a speculative bubble where there was no clear association between the bulbs themselves and some useful economic transformation on them. They weren't eaten, they weren't used in some means of production, they had no alternative significance other than the assumption that their price would keep rising.
This doesn't discount the core system originally developed to effectively explore the unknown (people, places, things) in the hopes it lead to some return on that investment. Both were speculative, one was a speculation on the unproductive, the other was the speculation on the potentially productive. To clarify, you as an investor may have no idea the true potential value of some foreign spice until you obtained it and provided access to it to others in your economy. It was still a bet.
Hindsights 20/20 but tulips should never have been assumed valuable in and of themselves beyond their aesthetics or use within some other process. Value is relative.
The Dutch also later outsourced their ship building to Britain leading to their relative weakening as Britain used the knowledge to build its own superior navy.
All this to say, if we are going to speculate on something, we should be speculating on how we might produce new value from existing things rather than vibes and aesthetics.
Still trying to defend the indefensible? If it looks like a duck, quacks like a duck, then it must be capitalism. I've lost count of the number of times somebody has said when confronted with yet another CAPITALIST disaster, 'Yeah well, this is not real capitalism, real capitalism died in (enter a date).' It's a bit like the death Spanish dictator, Franco, who although obviously dead, to acknowlege it would have been 'inconvenient'.
At the time, in order to make money through trade with in India, ships would need to be purchased for large sums and then stocked with goods and crew. If you sent out 3 ships and paid entirely yourself, one going down meant you lost 1/3rd your money. And ships went down often. Weather events, piracy, drift, etc. More ways to fail than to succeed by a large margin.
So they came up with a model to allow shares in the purchasing of the ships, the purchasing of the goods, and the payments to the crew. Then they allowed everyone from the townspeople to the goods producers to the dock workers to the crew themselves to buy shares in the venture. This is where the concept of a venture comes from, something of great difficulty require broad buy in. The legal system supported it and the result was orders of magnitude more ships capable of being funded and returning in one piece. If you spread your wealth across two dozen ships, any one of them going down meant you only lost a little but the upside was massive. More ships built for trade meant more ships to protect the tradeways and thus made success over all more likely. This was the rise of the Dutch.
We don't have that these days. Most people can't invest in private ventures without greater than 1 million dollars on hand or more, I'm not sure the specific conditions. And with the shareholder primacy objective, a small amount of money invested into a large public company won't give you equivalent return to a very large investor due to dilution of stake and other factors that get externalized to small investors. Employees are not compensated based on what they risk of themselves, their health, their ability to start and maintain families, intellectual risks, and many more examples. Take an oil rig worker. What is the health cost of staying for 6 months at sea on a vessel covered in oil and other health contaminants? What's the social cost? What's the opportunity cost? These aren't factored in. An oil rig worker makes nearly nothing compared to the long term costs they incur for the work they provide.
Another example, the data we produce in this conversation and through any other interaction through the internet is more valuable than you are likely considering. We receive none of it. But imagine if we did. If we were appropriately compensated for the production of information any time we produced that information, we would all be wealthier for it. Business pay roughly hundreds to thousands monthly for access to an individual buyer's transaction information and preferences on the chance that information leads to future sales directly or indirectly through individuals of similar profile. There are currently hundreds if not thousands of cases of the value of this kind of information to hundreds of thousands of organizations. If we made a tenth what was spent to gather information on our decision making and preferences it would be like the economic floor is the current upper income bracket. And this is to say nothing of higher value add data like biomedical and neurological data.
I know a story of a woman who's biological data lead to a multi billion dollar windfall for a pharma company and she didn't receive a penny.
This is not capitalism. How can we say we are capitalizing if most information and its value is ignored or deliberately masked?
William Bowles and Josh: Though I think Josh is correct in much of his account of Dutch economics (though in this forum I doubt he would claim to be complete), in that incompleteness, it's still economics in abstraction . . . abstracted from both an also-narrowly conceived history of economics, even when correctly drawn, AND from the vast history of so many other considerations which, in our time, have so incisively come to the fore, e.g., the political, ethical, social, cultural and, especially and differently in those times, religious context. Just the ideas of kingship and of slavery . . . There are questions that just didn't get asked "back then" that are essential to address today, that is if we are to survive with any sense of well-being.
The other thing that I found remarkable in my own studies is how Adam Smith's economic work (The Wealth of Nations and its "invisible hand working in economics") is still so admired (though also critiqued).
However, Smith also wrote what he says he meant as a companion book on the "Theory of Moral Sentiments." I read it closely for a course I was taking and realized even back then (in the early 90's) first, how quaint it had become and, second, how so very ignored, as to seem almost non-existent--though Smith obviously was thinking his ideas about morality were close to being universal (ha ha ha). Need I say who (I think in my most sober of attitudes) should recover it.
There is also one on sociability and America. I looked up Adam Smith/books and they don't even put the moral sentiments text near the Wealth of Nations text on the site. Hmmmm.......
Investors don't care, because as long as things go up, they go up. Many of them don't believe in AI at all, they're just making sure to pinpoint the right moment to get out. A lot of money will have been 'made' at the expense of so much.
Yes. But who will be, as per usual, taking up the slack? Just think back to the financial crisis. None of the organisations and big guns who profited were jailed or even financially penalized. The taxpayers however...
This has been my concern for quite some time as well. The business plan was always about the raise, never about the product; about how much confusion, hype, smoke and mirrors could be spun and how many industries could be infiltrated with coerced adoption in as short a time frame as possible, so that by the time the lie behind the machine was exposed, it was too late, everything was mixed up in it and so everyone would lose their shirts financially if it failed. A real corporate takeover.
It’s one thing for governments to bail out banks - that business has been around a long time and there is a need for it in some form - it is quite another to bail out a technology that has little proven utility to produce the things humans need to survive, while meanwhile has proven to include an unacceptable risk level to human health and planetary health.
Why should we sacrifice everything we have to continue to prop up the existence of something we don’t need and in a great many cases don’t want? So that we can bail out a bunch of billionaires who knowingly invested in an extremely risky venture?? Why should we protect their bad gambling habits??
We must oppose any effort by any government to prop up this industry on the backs of the people who did not sign up for this risk. Certainly the taxpayers are not seeing any benefits, only detriments, from AI. If it can’t pull its own weight, it must fail; the alternative is insanity.
I have switched off autocorrect and refuse to install any kind of AI crap that my android update is trying to force upon me. I proudly own any spelling mistakes as being mine and mine alone. Likewise the absence of such errors.
I read the other day that the new LLM-based autocorrect in an iPhone may introduce strange mistakes where there were none. Hallucinate while you type. Brave new world.
Can I ask what’s probably a really stupid question….?
As someone who is not even familiar enough with AI to have an account or have interacted with it….what exactly does it mean to fail? And what do those of us at the bottom do exactly? This feels very “the rich will do what they want and ultimately come out unscathed” but I don’t really understand the impact on those of us who aren’t invested in or have interactions with AI platforms outside of the integrations to platforms like Google searches.
Toiler: Yes, and thanks to our sterling communications technology, the disjunctive (horrifying) relationship between (a) human wisdom and (b) one's stock portfolio and bank account has become so very manifest in persons like, e.g., Elon Musk and Donald Trump. (Unfortunately, the list too long to copy here.)
In fact, the market may now be relying on just that. ' Maybe this will pay off, but even if it doesn't, Trump will have to bail out the "palaces of wusdom" '. If so, can't say the market's wrong.
A lot of time they effectively did because the government aid didn’t go in to equity but as a liability. The big downside of keeping the company solvent is that some of the company’s obligations are still in force, for example paying out huge payouts to executives. But it generally doesn’t turn out much better for the shareholders of the companies versus bankruptcy court for example.
Aaron Turner: I suppose it depends on whether its importance is understood in terms of creative developments in intelligence OR in its economic potentials.
My thought is that the China factor might have more to do with which kind of political power does AI progress fall under: (a) truly democratic, open, careful, and comprehensively ethical and humanitarian OR (b) some version of totalitarianism (fill in the blank). (Catherine Blanche King)
Belly laugh, then tears, then another belly laugh . . . but seriously, Joy, I'm sure you know that we all have to keep working at it. I think discussion jams like this one are helpful in that regard--and I have found myself worry a bit about what I write politically, but only since Trump showed up, but then before that in the 2nd Bush administration. (Political content was banned in an educational education forum via his religious committee. . . I'll never forget it.)
For myself, I realized a long time ago that, though there is no guarantee education will necessarily inspire the best in anyone (even if one actually found out what that was in any particular situation), a concerted and very long-term educational movement (not propaganda) is essential--and lays at the heart of a democratic culture (such as it is). I've known many Bonafide teachers who have committed to that idea, even as (kind of) anonymous participants. And it's what sparked my interest in philosophy, which I have never regretted.
I agree that education is the best defense against tyranny. The empowerment of individuals is essential to the cause of self-governance. I feel like I have been too silent for too long - worried about the professional implications of speaking out and its impact on the economic survival of my family, but things have reached the point where their physical, mental and emotional survival is even more imperiled and must be more important in the end. If not now, then when??
All the current trajectories point to self-destruction if nothing is done to interrupt.
It can be overwhelming to think about in the big picture, but every little thing we do to illuminate the paths before us is helpful. Every little thing we do to educate people about how freedom, justice and the rule of law work, is helpful. Every little discussion we have, sharing notes and observations, is helpful.
If AI is dangerous, as is now not just being admitted, but used as the basis of justification for its continued pursuit - because “China” (as if this is some kind of Manhattan project), then the countries that will truly lead the way are the ones that can counter AI, rather than “win” by adoption. Do you seriously think China uses these “weapons” on its own people? No - they let people in other countries be the Guinea pigs.
Why are we rushing to proliferate a known danger instead of investing in product that can identify and trace AI, and educating the public about how to protect themselves?
The government is not acting from a place of representing people, but is instead representing business.
The China reference is interesting, because there's probably no entity on Earth better at wasting vast sums of money than the Chinese government. I didn't think that was an area we'd want to compete in!
At some point, the US AI industry may start to look like those empty Chinese ghost cities. Anyone got any creative uses for thousands of unused data centers?
LS: Has anyone from that "camp" written or held serious talks about their influence on the environment or surrounding towns and people, long and short-term, and how to PROPERLY "blend in"?
I found an article in The Atlantic that explained how the Tech Titans are financing the data centers. Apparently, the companies are burning through their large amounts of cash. Issuing corporate debt is an anathema to these companies, I guess it's just too legacy. To meet their demand, they have teamed up with private equity and hedge funds who own the data centers. The hedge funds and private equity, in turn, lease these data centers to Amazon, Google, etc., etc. Then those leases are put into "tranches", securitized, and sold to investors. Sound familiar?? Can I buy a Credit Default Swap against these? Better yet, can I choose the securities to put in my debt purchase and still buy a Credit Default Swap? I am not clairvoyant, but I have been around long enough to predict when it blows up, those in the bottom 99% will be bailing them all out.
If these rich, greedy sociopaths get bailed out after being warned about their obviously bad investments I might just refuse to pay my taxes. If they have enough money to bet on things they were too lazy to research with due diligence, they must pay the price for their BAD JUDGMENT. We must end corporate welfare that bails out the rich, leaving innocent victims paying the price for their stupidity and greed. They certainly have enough money to throw away, as their absurd investments have proven, so they can take the loss they brought upon themselves.
Please keep sounding the alarm, Gary, so they can't possibly claim "No one saw this coming," and play ignorant victims like Wall Street did in 2008.
OpenAI and others in the AI industrial complex (Nvidia and AWS) are making an effort to tie their products and services deep into the U.S. military and Defense Dept. Ben Buchanan and Tantum Collins have an article in the recent Foreign Affairs, entitled, "The AI Grand Bargain," where they are trying to add more fear-based logic to this argument. Two weeks ago, on Wall Street Week (Bloomberg's show) the Secretary of the Army laid this out even more with names of companies and VCs being invited into to the revolution in military affairs started some years ago. What is unfortunate is that the American public is not paying this the attention it deserves. This will be similar to the 2007-2008 banking crisis, where the Federal Reserve will come in and buy the failed bonds being issued to finance AI infrastructure. U.S. electric power companies will get caught up in this as they will be financing new power plants and other part of the grid.
Gerald . . . didn't such payouts occur under a relatively liberal administration? And now we have a president in the US who issues pardons to evil people. Without fear or favor, it seems to me that it would be a massive political oversight to think the Trump administration is going to do anything but throw anyone under the bus who is not at least family, or who has enormous power and money to give to Trump and Co. Oh . . . ! I could be wrong--Trump, Sycophants, & Co. could all have kick-in-the-pants moral conversions. Whew. (Who is that person running out the door with their hair on fire?)
When the stock price is the product.
🔥
Milton Friedman's shareholder primacy = monetary feudalism.
Or Yanis Varoufakis's Techno-feudalism?
There is certainly techno-feudalism but I don't think it's limited to tech. Private equity has stake in many non-technical companies and their approach is a rent seeking behavior as well. I think it may be reasonable to suggest that techno-feudalism arises from the concept of shareholder primacy.
What the theory essentially says is the shareholder takes on the most risk by risking capital (bullshit) and as such they should be the only party of concern for an executive suite. The concerns of employees, suppliers, nearby residents, government, etc. don't matter. If the shareholder is the primary concern due to capital risk, the largest shareholder is the most "important" shareholder. It's effectively ranking people by how much financial capital they already have.
The result is increasingly externalizing risk from the largest stakeholder down through to non-shareholders and internalizing reward toward the largest shareholder. Is it a fundamental driver of inequality, it's built into the theory, and at the moment it is the primary theory driving most large organizations if not all.
Good read on this topic: Mariana Mazzucato: "The Value of Everything: Making and Taking in the Global Economy"
AI: the devalue of everything
The LLM is The Devalue Added Model
Peak postmodern capitalism?
I don't think what we have now is actual capitalism. The actual origin of capitalism prior to its modern definition was the Dutch at the beginning of their rise. The offer proportionate reward for proportionate risk taken where all were able to be included in ownership of both ships and goods on the ships. This lead to broadly improved ability to take on higher risk, higher reward activities that would otherwise have been infeasible. It wasn't rents extraction.
The Tulip bulb fiasco should be mentioned in this connection though, shouldn't it?
I appreciate the mention, the tulip mania was about 250 years post rise of the Dutch.
The tulip mania was a key indication of issues with understanding why their system worked in the first place. What was gained by trading with India, so far from the Netherlands, was myriad goods and other forms of knowledge useful broadly within the economy. Tulips were a speculative bubble where there was no clear association between the bulbs themselves and some useful economic transformation on them. They weren't eaten, they weren't used in some means of production, they had no alternative significance other than the assumption that their price would keep rising.
This doesn't discount the core system originally developed to effectively explore the unknown (people, places, things) in the hopes it lead to some return on that investment. Both were speculative, one was a speculation on the unproductive, the other was the speculation on the potentially productive. To clarify, you as an investor may have no idea the true potential value of some foreign spice until you obtained it and provided access to it to others in your economy. It was still a bet.
Hindsights 20/20 but tulips should never have been assumed valuable in and of themselves beyond their aesthetics or use within some other process. Value is relative.
The Dutch also later outsourced their ship building to Britain leading to their relative weakening as Britain used the knowledge to build its own superior navy.
All this to say, if we are going to speculate on something, we should be speculating on how we might produce new value from existing things rather than vibes and aesthetics.
Bravo
Still trying to defend the indefensible? If it looks like a duck, quacks like a duck, then it must be capitalism. I've lost count of the number of times somebody has said when confronted with yet another CAPITALIST disaster, 'Yeah well, this is not real capitalism, real capitalism died in (enter a date).' It's a bit like the death Spanish dictator, Franco, who although obviously dead, to acknowlege it would have been 'inconvenient'.
I'm not defending their approach to business. That should be obvious.
Are you familiar with the Dutch approach from 500 years ago?
not especially
At the time, in order to make money through trade with in India, ships would need to be purchased for large sums and then stocked with goods and crew. If you sent out 3 ships and paid entirely yourself, one going down meant you lost 1/3rd your money. And ships went down often. Weather events, piracy, drift, etc. More ways to fail than to succeed by a large margin.
So they came up with a model to allow shares in the purchasing of the ships, the purchasing of the goods, and the payments to the crew. Then they allowed everyone from the townspeople to the goods producers to the dock workers to the crew themselves to buy shares in the venture. This is where the concept of a venture comes from, something of great difficulty require broad buy in. The legal system supported it and the result was orders of magnitude more ships capable of being funded and returning in one piece. If you spread your wealth across two dozen ships, any one of them going down meant you only lost a little but the upside was massive. More ships built for trade meant more ships to protect the tradeways and thus made success over all more likely. This was the rise of the Dutch.
We don't have that these days. Most people can't invest in private ventures without greater than 1 million dollars on hand or more, I'm not sure the specific conditions. And with the shareholder primacy objective, a small amount of money invested into a large public company won't give you equivalent return to a very large investor due to dilution of stake and other factors that get externalized to small investors. Employees are not compensated based on what they risk of themselves, their health, their ability to start and maintain families, intellectual risks, and many more examples. Take an oil rig worker. What is the health cost of staying for 6 months at sea on a vessel covered in oil and other health contaminants? What's the social cost? What's the opportunity cost? These aren't factored in. An oil rig worker makes nearly nothing compared to the long term costs they incur for the work they provide.
Another example, the data we produce in this conversation and through any other interaction through the internet is more valuable than you are likely considering. We receive none of it. But imagine if we did. If we were appropriately compensated for the production of information any time we produced that information, we would all be wealthier for it. Business pay roughly hundreds to thousands monthly for access to an individual buyer's transaction information and preferences on the chance that information leads to future sales directly or indirectly through individuals of similar profile. There are currently hundreds if not thousands of cases of the value of this kind of information to hundreds of thousands of organizations. If we made a tenth what was spent to gather information on our decision making and preferences it would be like the economic floor is the current upper income bracket. And this is to say nothing of higher value add data like biomedical and neurological data.
I know a story of a woman who's biological data lead to a multi billion dollar windfall for a pharma company and she didn't receive a penny.
This is not capitalism. How can we say we are capitalizing if most information and its value is ignored or deliberately masked?
William Bowles and Josh: Though I think Josh is correct in much of his account of Dutch economics (though in this forum I doubt he would claim to be complete), in that incompleteness, it's still economics in abstraction . . . abstracted from both an also-narrowly conceived history of economics, even when correctly drawn, AND from the vast history of so many other considerations which, in our time, have so incisively come to the fore, e.g., the political, ethical, social, cultural and, especially and differently in those times, religious context. Just the ideas of kingship and of slavery . . . There are questions that just didn't get asked "back then" that are essential to address today, that is if we are to survive with any sense of well-being.
The other thing that I found remarkable in my own studies is how Adam Smith's economic work (The Wealth of Nations and its "invisible hand working in economics") is still so admired (though also critiqued).
However, Smith also wrote what he says he meant as a companion book on the "Theory of Moral Sentiments." I read it closely for a course I was taking and realized even back then (in the early 90's) first, how quaint it had become and, second, how so very ignored, as to seem almost non-existent--though Smith obviously was thinking his ideas about morality were close to being universal (ha ha ha). Need I say who (I think in my most sober of attitudes) should recover it.
There is also one on sociability and America. I looked up Adam Smith/books and they don't even put the moral sentiments text near the Wealth of Nations text on the site. Hmmmm.......
lots of clever reply but was giving extra kudos for the punchline !
Investors don't care, because as long as things go up, they go up. Many of them don't believe in AI at all, they're just making sure to pinpoint the right moment to get out. A lot of money will have been 'made' at the expense of so much.
“Too arrogant to succeed” is the unstated corollary of TBTF.
We are waiting for the vaporware to vaporize the absurd valuations.
Yes. But who will be, as per usual, taking up the slack? Just think back to the financial crisis. None of the organisations and big guns who profited were jailed or even financially penalized. The taxpayers however...
I'm stealing this.
Steal away!
"Too AI-rogant"?
Ouch
"SquAIred Hubris"
AI-rogance
Is hubris squAIred
By AIry rants
We've been ensnAIred
"Putting on AIrs"
AI-rogance is naught
But putting on the AIrs
It's full of AIry rot
And brags about the wares
"AI-rogance"
Mere hubris ain't enuff
For Altman and the rest
AI-rogance is stuff
In which they all invest
This has been my concern for quite some time as well. The business plan was always about the raise, never about the product; about how much confusion, hype, smoke and mirrors could be spun and how many industries could be infiltrated with coerced adoption in as short a time frame as possible, so that by the time the lie behind the machine was exposed, it was too late, everything was mixed up in it and so everyone would lose their shirts financially if it failed. A real corporate takeover.
It’s one thing for governments to bail out banks - that business has been around a long time and there is a need for it in some form - it is quite another to bail out a technology that has little proven utility to produce the things humans need to survive, while meanwhile has proven to include an unacceptable risk level to human health and planetary health.
Why should we sacrifice everything we have to continue to prop up the existence of something we don’t need and in a great many cases don’t want? So that we can bail out a bunch of billionaires who knowingly invested in an extremely risky venture?? Why should we protect their bad gambling habits??
We must oppose any effort by any government to prop up this industry on the backs of the people who did not sign up for this risk. Certainly the taxpayers are not seeing any benefits, only detriments, from AI. If it can’t pull its own weight, it must fail; the alternative is insanity.
Perhaps the true meaning of the 'I' in AI?
Schizophr-AI-nia would explain the hallucinations.
OpenAI should literally change its name to “Tulip.” I bet that’d raise their IPO to $2tn.
Cf. https://blurredworlds.com/wp-content/uploads/2015/03/dig-up-stupid.png
Hard to believe the industry that gave us Grok could be based on a bunch of lies…
lol
I have switched off autocorrect and refuse to install any kind of AI crap that my android update is trying to force upon me. I proudly own any spelling mistakes as being mine and mine alone. Likewise the absence of such errors.
I read the other day that the new LLM-based autocorrect in an iPhone may introduce strange mistakes where there were none. Hallucinate while you type. Brave new world.
Autocorrect on iPhones has been producing mistakes where there are none for a long time . Long before Large Languish Models
Can I ask what’s probably a really stupid question….?
As someone who is not even familiar enough with AI to have an account or have interacted with it….what exactly does it mean to fail? And what do those of us at the bottom do exactly? This feels very “the rich will do what they want and ultimately come out unscathed” but I don’t really understand the impact on those of us who aren’t invested in or have interactions with AI platforms outside of the integrations to platforms like Google searches.
Good questions. Reminds me of the quip that when elephants fight it's the grass that suffers.
A bit more to the point might be this oldish article that Gary had linked to elsewhere:
"Will data centers crash the economy? This time let's think about a financial crisis before it happens."
https://www.noahpinion.blog/p/will-data-centers-crash-the-economy?utm_medium=web&triedRedirect=true
Veronica: Copy that . . . and sing it from the rooftops.
Thank you, for proving once again there are no stupid questions!!
At what point does Generative AI, polluted by its own slop, become Degenerative AI?
Already. Next it becomes “Degenerate AI” and its most popular avatar will Joel Grey in his role in Cabaret.
"Willkommen, bienvenue'
Have we, perhaps, in the Wiley moment, already passed that point?
You know it would be a big help if you would actually provide a links to some of these things that you just provide pictures of. Just a thought ...
The Trump bailout of Altman and co. is as foreseeable as the Bengals losing another game in the final two minutes.
Toiler: Yes, and thanks to our sterling communications technology, the disjunctive (horrifying) relationship between (a) human wisdom and (b) one's stock portfolio and bank account has become so very manifest in persons like, e.g., Elon Musk and Donald Trump. (Unfortunately, the list too long to copy here.)
I might even believe the relationship you mention is best described as 'inverse."
I would describe it as perverse, as in “perverse incentives”.
Perversely inverse? Might be just the combo!
In fact, the market may now be relying on just that. ' Maybe this will pay off, but even if it doesn't, Trump will have to bail out the "palaces of wusdom" '. If so, can't say the market's wrong.
There is a playbook for this. You just step in during the bankruptcy and support the business itself while letting the investors go to 0.
Remind me of when that happened last.
A lot of time they effectively did because the government aid didn’t go in to equity but as a liability. The big downside of keeping the company solvent is that some of the company’s obligations are still in force, for example paying out huge payouts to executives. But it generally doesn’t turn out much better for the shareholders of the companies versus bankruptcy court for example.
At some point the bubble will become too big to bail.
Aaron Turner: I suppose it depends on whether its importance is understood in terms of creative developments in intelligence OR in its economic potentials.
My thought is that the China factor might have more to do with which kind of political power does AI progress fall under: (a) truly democratic, open, careful, and comprehensively ethical and humanitarian OR (b) some version of totalitarianism (fill in the blank). (Catherine Blanche King)
Where, or where, might we find country (a)? Might want to consider moving there.
Belly laugh, then tears, then another belly laugh . . . but seriously, Joy, I'm sure you know that we all have to keep working at it. I think discussion jams like this one are helpful in that regard--and I have found myself worry a bit about what I write politically, but only since Trump showed up, but then before that in the 2nd Bush administration. (Political content was banned in an educational education forum via his religious committee. . . I'll never forget it.)
For myself, I realized a long time ago that, though there is no guarantee education will necessarily inspire the best in anyone (even if one actually found out what that was in any particular situation), a concerted and very long-term educational movement (not propaganda) is essential--and lays at the heart of a democratic culture (such as it is). I've known many Bonafide teachers who have committed to that idea, even as (kind of) anonymous participants. And it's what sparked my interest in philosophy, which I have never regretted.
CORRECTION: That's an "adult educational forum," not "educational education forum." C. King
I agree that education is the best defense against tyranny. The empowerment of individuals is essential to the cause of self-governance. I feel like I have been too silent for too long - worried about the professional implications of speaking out and its impact on the economic survival of my family, but things have reached the point where their physical, mental and emotional survival is even more imperiled and must be more important in the end. If not now, then when??
All the current trajectories point to self-destruction if nothing is done to interrupt.
It can be overwhelming to think about in the big picture, but every little thing we do to illuminate the paths before us is helpful. Every little thing we do to educate people about how freedom, justice and the rule of law work, is helpful. Every little discussion we have, sharing notes and observations, is helpful.
Thank you.
If AI is dangerous, as is now not just being admitted, but used as the basis of justification for its continued pursuit - because “China” (as if this is some kind of Manhattan project), then the countries that will truly lead the way are the ones that can counter AI, rather than “win” by adoption. Do you seriously think China uses these “weapons” on its own people? No - they let people in other countries be the Guinea pigs.
Why are we rushing to proliferate a known danger instead of investing in product that can identify and trace AI, and educating the public about how to protect themselves?
The government is not acting from a place of representing people, but is instead representing business.
The China reference is interesting, because there's probably no entity on Earth better at wasting vast sums of money than the Chinese government. I didn't think that was an area we'd want to compete in!
At some point, the US AI industry may start to look like those empty Chinese ghost cities. Anyone got any creative uses for thousands of unused data centers?
LS: Has anyone from that "camp" written or held serious talks about their influence on the environment or surrounding towns and people, long and short-term, and how to PROPERLY "blend in"?
Yes. The situation is surely concerning at many levels. I had written about OpenAI wanting to eat everyone’s lunch (The Empire that wants it all)
https://open.substack.com/pub/pramodhmallipatna/p/openai-the-empire-that-wants-it-all
And couple this with circular deals makes it even more concerning
AI’s grand entanglement
https://open.substack.com/pub/pramodhmallipatna/p/ais-grand-entanglement-the-subprime
I found an article in The Atlantic that explained how the Tech Titans are financing the data centers. Apparently, the companies are burning through their large amounts of cash. Issuing corporate debt is an anathema to these companies, I guess it's just too legacy. To meet their demand, they have teamed up with private equity and hedge funds who own the data centers. The hedge funds and private equity, in turn, lease these data centers to Amazon, Google, etc., etc. Then those leases are put into "tranches", securitized, and sold to investors. Sound familiar?? Can I buy a Credit Default Swap against these? Better yet, can I choose the securities to put in my debt purchase and still buy a Credit Default Swap? I am not clairvoyant, but I have been around long enough to predict when it blows up, those in the bottom 99% will be bailing them all out.
If these rich, greedy sociopaths get bailed out after being warned about their obviously bad investments I might just refuse to pay my taxes. If they have enough money to bet on things they were too lazy to research with due diligence, they must pay the price for their BAD JUDGMENT. We must end corporate welfare that bails out the rich, leaving innocent victims paying the price for their stupidity and greed. They certainly have enough money to throw away, as their absurd investments have proven, so they can take the loss they brought upon themselves.
Please keep sounding the alarm, Gary, so they can't possibly claim "No one saw this coming," and play ignorant victims like Wall Street did in 2008.
OpenAI and others in the AI industrial complex (Nvidia and AWS) are making an effort to tie their products and services deep into the U.S. military and Defense Dept. Ben Buchanan and Tantum Collins have an article in the recent Foreign Affairs, entitled, "The AI Grand Bargain," where they are trying to add more fear-based logic to this argument. Two weeks ago, on Wall Street Week (Bloomberg's show) the Secretary of the Army laid this out even more with names of companies and VCs being invited into to the revolution in military affairs started some years ago. What is unfortunate is that the American public is not paying this the attention it deserves. This will be similar to the 2007-2008 banking crisis, where the Federal Reserve will come in and buy the failed bonds being issued to finance AI infrastructure. U.S. electric power companies will get caught up in this as they will be financing new power plants and other part of the grid.
Gerald . . . didn't such payouts occur under a relatively liberal administration? And now we have a president in the US who issues pardons to evil people. Without fear or favor, it seems to me that it would be a massive political oversight to think the Trump administration is going to do anything but throw anyone under the bus who is not at least family, or who has enormous power and money to give to Trump and Co. Oh . . . ! I could be wrong--Trump, Sycophants, & Co. could all have kick-in-the-pants moral conversions. Whew. (Who is that person running out the door with their hair on fire?)