The plutonomy transition is well under way. The sardinian seafront villa will likely retain and gain value as the early anthropic employee might like it, while the house in some flyover state might not find any buyers.
The economy of the future will be about yachts, supercars, hermes bags, private air travel and ozempic. Not about how you made it possible for everyone to watch a gigantic library of videos for free, or how you made cars affordable for everyone.
I doubt that if Norway buys OpenAI, it will be the company that captures the value.
There is no inherent property to those model makers that they will capture the value of the AI boom. The model companies have a lot of competition from chinese models. Of course the US government will likely still keep some model makers alive (just alone for DOD supply chain reasons), but the chinese models will certainly compress margins.
It might as well be a chipmaker, a power company or a cobalt mining company.
Ultimately, it's up to the US government to decide if OpenAI can capture the value provided by AI: if chinese models get banned from the F500, then maybe one of america's famous duopolies can establish themselves.
But this hinges on congress mostly to pass certain laws to put OpenAI into that position. But which value does congress have? If OpenAI is owned by a bunch of Forbes 400 people like right now, then of course those will lobby the hell out of congress and ensure their stakes in OpenAI make them extremely rich.
But Norway doesn't have that access to lawmakers, they would see it as external influence by an alien power. They can certainly benefit from this trend though by being a shareholder.
To give a concrete example of the US government making life hard for foreign investors, take the T-mobile and sprint merger. T-mobile is majority owned by Deutsche Telekom AG, whose biggest shareholder are various institutions of the german federal government.
In this case, the US government just had to _approve_ the purchase, something very standard that happens all the time, but they still dragged that approval out as long as possible, even though Germany is a fellow NATO country.
Mostly this is just about giving back the money RWE paid for the leases from the US government to build those turbines. Plus various fees. They could have went for suing for total profits too.
> RWE U.S. Offshore secured these leases from the U.S. government with a long-term commitment to develop offshore wind capacity in American waters and invested more than $1 billion toward the leases and the development of these projects. These leases provided legal rights to develop offshore projects and represented years of planning, investment, and partnership with federal agencies.
> After careful consideration, it was determined there is no path forward to permit these projects in the U.S. for the foreseeable future. The settlement resolves RWE U.S. Offshore’s legal claims and provides $1.22 billion in settlement funds.
Or in one of my favorite coinages: "Moral Crumple Zones".
"Just as the crumple zone in a car is designed to absorb the force of impact in a crash, the human in a highly complex and automated system may become simply a component—accidentally or intentionally—that bears the brunt of the moral and legal responsibilities when the overall system malfunctions."
See https://ferd.ca/notes/paper-moral-crumple-zones.html
Related: "Accountability Sink", a system which is designed to channel responsibility away from the people making the decisions, e.g. a powerless "complaints department".
In a rare bit of still-sane news, the US National Highway and Safety Administration staff aren't dumb: Their policy is to consider whether any automation was active in 30 seconds before the crash.
the whole concept of having cars with that are almost capable of self-driving is utterly insane, the very least you'd need special training. We are not equipped to deal with something that works brilliantly most of the times but might kill you for no foreseeable reason.
Yeah, that's definitely the frustrating zeitgeist for me these days, which extends to LLMs.
I'd also emphasize that it's not just error rate, but the shape/distribution of errors, and our (in)ability to build control systems around them.
To illustrate, imagine if someone unveiled a car which was unambiguously safer in every statistical measure... buuuut some of its unsafety came from jumping the curb to chase and kill pedestrians, under circumstances we can't predict for reasons we can't diagnose.
Even pilots are getting this automation-complacency now. A plane crashed because the military jammed GPS and the pilot wasn't used to any backup procedures even though 30 years ago they were the only procedures.
If a company advertised an LLM as perfectly safe and then it caused some damage, there would be a case against the company.
Have you used LLM tooling? It comes with warnings and explains that the user accepts the risk. Different levels of warning are supplied for the different levels of autonomy you can enable. The user has to understand the risk as they enable it.
This is not a new concept and it’s not an idea the LLM companies invented. It shouldn’t be surprising to anyone.
> This is not a new concept and it’s not an idea the LLM companies invented.
I don't recall any prior computer software working so badly that it needed a disclaimer like "Claude is AI and can make mistakes" on its front page. Let alone one so costly.
You must not use any open source software, because much of it comes with a whole paragraph of ”IN NO EVENT SHALL THE AUTHORS OR COPYRIGHT HOLDERS BE LIABLE FOR ANY CLAIM, DAMAGES OR OTHER LIABILITY“
If you read the fine print of most commercial software you'll see some language to a similar effect. When's the last time Microsoft got sued due to an outage caused by a bug in Windows?
An outage is not the same thing. A similar thing would be if Outlook 365 started sending emails on your behalf or changing around words in them, or if SAP / Quickbooks said: "No guarantee that the numbers you type in match the results of the annual statement we produce", or if Tesla was like "You should absolutely not use our cars for driving anywhere".
If you bring language like this into more traditional fields, it feels absolutely bonkers.
It's not new to LLM companies, but it does seem like they're leaning away from the standard "Hey, don't blame us if this doesn't work" and are moving into "It's now your fault any time our software fucks something up" which feels new.
For example, protein folding has been figured out by AI. This was a very big moment for science and yielded a nobel prize. Alphafold 1 happened 4 years before the first version of ChatGPT and the LLM craze we see today.
But yeah, most problems in physics, chemistry or biology require labs on top of actual hard thinking. You need to be able to design experiments in a certain way. Once you have the funding, the right tools, the right people to use those tools, then you can use LLMs to increase the speed of the calculations and so on.
Yeah with China pumping state subventions into car manufacturing, they can outcompete any car manufacturer anywhere in the world. The leading battery technology is in Asia anyways.
The German car industry will not die completely, as the EU can protect its market from chinese manufacturers through regulation. But it will shrink and transform. Probably also back to fossil fuels (yuck), because there the Germans still have a lead (they are trailing with EVs).
Man, every time where there's a Chinese product category you realistically can't compete with - it's always some excuse of - because Chinese state is subsidizing it and supporting it.
All it does is simply makes the Chinese government sound good and competent.
Oh, nice, a government that does good things that lead to good outcomes! How unusual, how unexpected!
That's basically cheating!
We can't realistically have our government be useful and competent and serve our interests, so there's no way we can compete!
It's an interesting comparison. In China they prop up businesses with cheap loans and help from local governments, in the US it's the VCs. So when Uber was subsidized then everything was ok, but when China state propped up EVs then suddenly it's not ok. These subsidies in the majority of cases are over btw, because competition was too big in China between carmakers, cars in China are ridiculously cheap. Because that's their strategy, you fund a lot of players, like there were 100+ EV makers in China, then you let the market do its job, they optimize or they die, some will die and the best will prevail. Margins are so low in China that they are looking at outside markets where legacy carmakers need to drop the margins and scale up or they will have no chance in competing.
And for the argument that they do it to kill the industry so then they can make cars for more price, the most obvious counterargument is why they didn't do it for everything else that they dominate already? Why are solar panels going down? They dominate the world in solar panels, there is basically no competition and prices are still going down, same with batteries.
Capitalism and free markets failed to deliver, lots of cope around that mental model. If it was superior, it would’ve succeeded. China is 1/3rd of global manufacturing capacity, and it shows. Play to win.
It was the market that delivered BYD and Xiaomi. The government did his part with industrial policy and inviting Tesla to China to help start the ecosystem, but the brutal competition between Chinese auto makers following the rules of capitalism and free-market made those who survive the ones that can compete with other global companies. Before that they just subsidised and all they got were regional "champions" that siphoned out the funds and created shitty products no one wanted.
After Tesla came with special laws allowing it to work without Chinese co-ownership, but with a mandate to source from Chinese suppliers, this created the ecosystem needed for the next iteration, by the capitalist urge of Elon to get into the market and by free-market economy of suppliers to Tesla that are up to the standards to supply it.
The government set up the battlefield, and let the free-maket filter the strongest to survive.
In the Western countries the government and regulations are frequently the bane of the car companies. Good luck opening a mine or a battery factory in Germany, regulation, unions, green mandates, 36 hr. week. You can't fight with 1 leg tied.
This narrative overweights free market competition in China and any influence Tesla or Musk might have had versus the $230B in subsides provided to the Chinese EV industry over 14 years (2009-2023), with over ~$1.5B provided to CATL alone (although Tesla did receive ~$17B in total government subsidies in the US). Tesla did not begin production in China until October 2019.
If there’s any hero story here, its the will of the CCP to provide this level of support and subsidy to the Chinese battery and EV industries as part of their five year plans. This is why China can build ~20M EVs per year, Europe ~4.6M, and the US can build ~2-3M.
I understand this deeply challenges the ideas and belief systems around the cult of personality of risk taking entrepreneurs and entrepreneurship being something more than a series of successful calculated risks and bets.
> When it comes to China’s electric vehicles (EV) industry, its market has expanded exponentially compared to other markets. Now, a new study by the Center for Strategic and International Studies (CSIS) has revealed that China’s EV industry received at least $230.8 billion in government support between 2009 and 2023.
> As a result, this major investment has played a pivotal role in China’s rapid progress to become the world’s largest EV market, with sales anticipated to reach 10 million units in 2024.
Yes, there was investment, but investment without free markets and capitalism doesn't work usually for end products like cars. It's not a linear function of the capital invested, it's not possible to spend your way into good consumer products. That's not infrastructure. That's why I was mentioning that before Tesla came that investment didn't lead to any strong EV automotive players. In 2016 there was a big scandal on widespread EV fraud, where manufacturers just built to get the subsidy(骗补).
The policy shift came around 2017 when the government understood that subsidies and closed market created lazy automakers (e.g. check the US market for the same dynamic in trucks). In 2018 they removed subsidies for cars less than 150km of range and changed the requirements to receive them tying them to battery density.
After Tesla came and subsidies were reduced, most of the inefficient companies went bankrupt. It was the free-market competition that killed them. The reason why it changes was the competition not the subsidy. The subsidy was somewhat important, but as many of us knows, nothing government run produces good consumer products, you need market and free choice to get productivity. So it was the free-market and subsidy cutting that created the BYD, Li Auto, Xpeng and Nio. That's the proof that without free market it's impossible to have strong companies. And without subsidies you can have strong companies, even if it takes more time.
In EU and USA subsidies didn't create a lot (Northvolt?), because there were not enough free-market driven demand and too much regulation to jumpstart the free-market forces that will start the engine of innovation.
So the answer is not "capitalism and free-market doesn't work and governmental industrial policy is the answer", but it's the market that creates the strong companies. You can speed it up with venture/government capital, but without the brutal competition in the marketplace where people vote with their wallets you won't make it work.
I hope they can compete with plugin hybrids. We have a BMW X5 plugin hybrid, bought on the advice of a friend, and it's such a great car. Almost always on electric in town, and for the rare times we go on road trips we never have to worry about range anxiety.
I really feel that plugin hybrids with 40-50 miles of electric range are the ideal car for like 85%+ of Americans whose usual daily commute could all be done on electric. I've heard all the arguments against them, and after owning 2 PHEVs (Chevy Volt before this), I disagree with all these arguments. Yes, I understand that they're more complicated that a pure EV, I know pure EVs will be the future (I'll also be dead in the future), but my ownership experience with PHEVs over the past decade proved they were the perfect car for me. Never had any reliability issues, and despite hearing arguments that they are "the worst of both worlds", they were definitely the best of both worlds for me - all the benefits of an EV (low operating cost, fantastic acceleration, quiet, smooth ride, almost no trips to the gas station) with none of the downsides (didn't need to install an expensive charger at home as the wall charger was sufficient, never had to worry about range anxiety, never had to carefully plan road trips around charger locations).
I think you're directionally correct. But that BMW will likely turn into a maintenance nightmare in 10 years when electronics modules start failing and new replacement parts are no longer available. Might be best to lease it instead of buying for those who can afford that option.
I think the biggest problem with German EVs are not the battery but the software. EVs are practically computers on a wheel and compared to the competitors the software and features it offers are still terrible. I remember VW even had a huge joint venture with Rivian to get things back on track. But seems like it didn’t work out
There’s nothing about EV drivetrain that requires more complicated software than ICE powertrain. It’s just consumerism telling people that their next vehicle (whatever drivetrain) should be an iPad, a home cinema, and a PlayStation all-in-one.
that's not the issue, you can buy the batteries if you wanted to. The problem is that EVs require about 50% less labor than ICE cars and this is the first time since the 80s that German car companies have started to fire anyone or close plants. Car companies here aren't price competitive, software or a battery you can always purchase.
China has the big advantage of having designed these car companies around drastically reduced labor needs and until we adapt to that we're not going to compete on the most important factor which is how much the car costs.
> German car industry is trailing with EVs, because they can not manufacture the heart of EV - the battery.
"We tried nothing and we're all out of ideas!" ... The German car industry could have seen the EV revolution coming a mile off, but instead of embracing it, it did nothing. Well, it faked some diesel tests, so I suppose not nothing, but not useful.
At least in the US, Toyota is wildly successful across every segment. The RAV4, Camry, Corolla, and Tacoma do massive numbers, even though the compact and midsize sedan market is collapsing. Even niche offerings like the GR Corolla can be challenging to procure from a dealer. The Toyota Tax in the used market is unbelievable. For a huge number of people, there is no manufacturer that gets even close to the same amount of respect that Toyota does. Their victory was so overwhelming that it permanently changed how manufacturing is done and an entire generation of prideful Americans will readily admit that the Big Three were on the back foot in the 80s and 90s.
Not to say that China isn’t capable of something similar, but you do have to understand that your tastes/value assessments are very much not representative of the sizable US market on the whole if you would seriously take a Sentra over a Corolla, or an Equinox over a RAV4. The calculus may be a bit different in the European market, of course.
cargo check is useful to verify the code compiles (it's extremely rare to have compilation errors that survive cargo check). But cargo build is required if you want to actually try out the code you wrote, e.g. in order to run a test that you or the LLM wrote.
Yeah but like, tests encode behavior… sometimes I go all day without running a test. Sometimes multiple days. I’ve been using unit tests less and debug asserts more and more now days anyways. Encoding behavior as close the relevant code as possible. And using types and type state to minimize invariants. Idk, but it seems like such a smell when my coding agent drops 10 unit tests for a 300 LoC module. It means it did a bad job of writing the code in the first place.
Anyways, if the code compiles, but the behavior is wrong, a test might be useful. But so is reading the code… so I’m skeptical of rerunning tests constantly.
Yeah, I mean more for the iteration half -- YMMV, but I find that I make the LLMs most productive when I have them design the typestates first, ensure they compile, and then work on tests after that (rather than stacking tests through the process).
You can still get traction for your workout apps, CRMs etc with the right market research (you need to find a niche) and the right marketing.
There are gazillions of candy crush remakes, but Royal Match, launched in 2021, still made it to the top in revenue. It was not thanks to some existing monopolist pushing it, but thanks to a) ginormous marketing budget and b) relentless execution and experience of making mobile games before, i.e. you know what works, what doesn't, how to extract maximum amount of revenue, etc.
> It was not thanks to some existing monopolist pushing it, but thanks to a) ginormous marketing budget and b) relentless execution and experience of making mobile games before
Er... so you don't need to be a monopolist, just have a massive amount of existing capital and deep understanding of the field?
Is it the AI companies though that will capture the value that AI creates, or will it be the still-private startups, or new to-be-founded startups altogether?
Startups are taking longer and longer to reach public markets, so more and more value creation requires you to be a family office, angel, or hedge fund.
The economy of the future will be about yachts, supercars, hermes bags, private air travel and ozempic. Not about how you made it possible for everyone to watch a gigantic library of videos for free, or how you made cars affordable for everyone.
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