The most dangerous idea you’ve probably never heard of

May 31 JDN 2461192

They call themselves effective accelerationists, co-opting the acronym EA from Effective Altruism despite being about as diametrically opposed as it is possible to be.

They rally behind the Techno-Optimist Manifesto, which I admit makes a lot of good points and has a very seductive quality to it; but when you get to the end and reach the conclusions they draw from many reasonable-sounding premises, the result is absolute horror.

What do they want?

Totally unrestricted artificial intelligence produced as fast as possible.

Let’s be clear about this: They not only want to develop artificial intelligence (many people want that). They not only want to replace humanity with artificial intelligence (serious philosophers have suggested that this might be a long-term evolution for our civilization). They want to do it right now, without restrictions.

Their reasoning seems to go something like this:

  1. Artificial intelligence has tremendous potential.
  2. Improved computing has already been a tremendous boon to humanity, Applications of artificial intelligence to many fields such as scientific research and biotechnology could continue to be so.
  3. Free-market capitalism is the most efficient economic system yet devised.

Therefore,

  1. We should allow (or even incentivize) corporations to make artificial intelligence as powerful as possible as quickly as possible.

If we were to apply their same reasoning to other technologies, it would be obvious what’s wrong here. Consider the following argument:

  1. Nuclear energy is tremendously powerful and very environmentally-friendly.
  2. Cleaner, more powerful energy has been a boon to humanity, and would continue to be so if improved further.
  3. Free-market capitalism is the most efficient economic system yet devised.

Therefore,

  1. We should grant unrestricted access to nuclear material to anyone who is rich enough to afford it.

From three entirely reasonable premises (that honestly should be uncontroversial, even though they aren’t), we have made some kind of leap of logic to derive a conclusion that is utterly insane, and could literally result in the destruction of our entire civilization.

(And, if you’re not horrified enough yet, this isn’t even hypothetical after all: The US government is seriously considering giving weapons-grade plutonium to tech startups, apparently based on this exact reasoning.)

I agree that artificial intelligence has tremendous potential. That is why it must be kept on a tight leash.

In the near term, it is already poised to severely disrupt our economy and education system. But sufficiently-powerful AI genuinely could result in harms that could kill billions of people or even destroy human civilization. (I don’t think this will happen; but if the effective accelerationists have their way, that outcome becomes a lot more likely.)

Part of their argument seems to be that delaying new medical treatments and solutions to global problems will cost lives. This is true. But it’s far fewer lives than we would be putting at risk by pulling out all the stops and letting corporations do whatever they feel like doing.

I, too, want to see a glorious future where humanity transcends our current limits through biotechnology or cybernetics or truly-sentient artificial general intelligence. But the benefits of doing that a few years—or even decades, or even centuries—sooner are simply not worth the risk of destroying our entire civilization.

When dealing with a technology this powerful and a change this radical, the most important thing is to do it correctly—not to do it quickly. We need to make sure that the artificial intelligence we create is wise and benevolent so that its great power benefits humanity—and with this much at stake, it’s worth taking a long time to get it right if we have to.

A world run by copies of Lieutenant Commander Data would be a paradise. A world run by copies of Grok would be a hellscape. It’s worth spending some time to make sure we get the former and not the latter.

The stochastic superstar economy

May 17 JDN 246178

Why do I make less money than, say, Mr. Beast (who now has a game show, apparently)?

The proximal answer to this question is obvious: He has a lot more people viewing his content, so he can sell ads that make him enormous amounts of money.

But that still leaves a deeper, more ultimate question unanswered:

Why are so many people interested in that?

Mr. Beast’s first truly viral YouTube videos was literally just him counting, one by one, from 1 to 100,000. He edited the footage to speed it up slightly so that the 40-hour ordeal would fit within a 24-hour video.

This is something that literally anyone could do that literally no one benefits from.

I also can’t imagine it was particularly entertaining to watch! Like, maybe he made it a little more entertaining than you might at first imagine (I don’t know; I have no desire to watch the actual video), but I still can’t imagine it would rate among even the top 100 most interesting things to do with 24 hours—or even the top 100 most interesting things that I could do right now from the comfort of my own home.

Right now you might be thinking I’m bitter about this, but if I am bitter, it is at our economic system as a whole; I harbor no ill will toward Mr. Beast in particular, who is actually something of a philanthropist. What I really am is utterly confused.

I don’t understand why anyone—let alone millions of people—would choose to watch that video. (Though it’s a bit easier to understand if you recognize that most viewers surely did not watch the entire thing.) I don’t understand how a man can make a highly successful career doing stupid stunts on video.

And I’m also quite certain that if I, right now, tried to do some similarly stupid stunt and post it on YouTube, it would get maybe a few dozen hits and nothing more would come of it.

Maybe Mr. Beast has something I don’t: A charm, a charisma, a salesmanship. Maybe he is spectacularly persistent in a way that I really can’t be (one certainly must be that to count to 100,000!). He likely is utterly unfazed by rejection, while I am severely oversensitive to it. So I’m not making the claim that there is nothing about Mr. Beast’s individual characteristics or talents that contributed to his success.

But I think it’s pretty clear at this point that the most important reason for Mr. Beast’s success is in fact no reason at all; his video is just the one that happened to go viral at that particular moment, and he managed to leverage that publicity into making yet more viral videos until he could become a multi-millionaire for doing stupid stunts in front of a webcam.

He is what I propose we call a stochastic superstar.

His success is not driven by talent, or intellect, or expertise; it is driven by luck. A million others have tried to imitate his exact methods and failed, not because they were any worse at it—but because he did it first.

This phenomenon is not entirely new; it certainly can be traced back at least as far as any form of mass media; radio and TV stars were often famous for no other reason that they were famous.

But I think it’s pretty clear that the Internet, and social media in particular, have made it much easier to become a stochastic superstar. Arcane, mysterious algorithms promote some content over other content in ways that hardly anyone—or perhaps literally no one, if LLMs are now involved—fully understands, and thousands of people doing basically the same thing get zero compensation for it, while one becomes rich and famous for no apparent reason.

This is not a healthy way to run an economy.

Yes, it certainly results in creating a lot of content, some of which is genuinely valuable. (Mr. Beast would not be high on my list of that either.) The Internet is an unfathomably grand and diverse place, and if you know where to look you can learn about almost anything in the world; or, you know, you can be fed complete misinformation and come away with fundamental misconceptions. Or you can just watch cat videos, which I’ll admit add some joy to the world, but probably not nearly enough to justify the amount of effort and time spent creating and viewing them.

It’s bad enough that glorifying superstars glorifies risk; but at least superstar athletes are objectively in peak physical condition and are the best players at the games they play. (I still don’t really get why people invest so much in these games, but whatever.) But it isn’t even clear that viral YouTubers are producing the best video content; they are just somehow producing the most successful video content in a way that seems basically orthogonal to actual quality or value for society.

I think this should lead us to a very important question:

Are there other systems we could use to compensate people for content?

What if ad revenue was divided evenly between all contributors to a platform, rather than just those with the highest view rates? Or what if there was some benefit to getting higher views, but there was some sort of mechanism to reduce the income inequality generated this way, like paying higher rates for views when you have fewer total views (e.g. $0.01 per view for the first 1000, $0.009 for the next 10,000, $0.008 for the next 100,000, etc.)? (Are there perverse incentives here, too? Surely. But are they worse than what we have right now?)

What if we didn’t run ads at all, but instead people paid microtransactions to subscribe to content? Patreon already sort of does this (and my Patreon is also an utter failure), but I think the transactions still aren’t micro enough. I want people to pay $0.05 to read an article—because that’s all the ad revenue they would give by reading that article anyway. Nobody should have to pay $5 to read what advertisers only pay $0.05 for. I want you to be able to see the title of a blog post and a brief snippet, and think, “Sure, I’ll pay a nickel to read that.” I don’t want you to have to decide whether you’re willing to commit to subscribing for an entire month for $5.

I would like to believe, at least, that people would be more willing to pay $0.05 to read good journalism and serious intellectual content, rather than a random guy counting to 100,000 for no reason. But even if that’s not true, at least we wouldn’t be so constantly inundated by ads!

Or what if social media platforms were maintained as public infrastructure, not yielding profits to any corporation, and instead of running ads, their hosting costs (which really are not all that high; I pay for my own hosting on this blog, for instance) were covered by tax revenue? Or what if you simply paid a subscription to use the social media site, and it was no longer used to harvest your data and target ads to you?

With an alternative system like one of the above, stochastic superstars would still be able to get famous randomly, and there are benefits (and drawbacks) that come directly from being famous; but maybe at least there would be fewer multi-millionaire YouTuber superstars and more ordinary people who are better able to make ends meet by contributing content.

But who am I kidding? This system works great for the billionaires who run it (who makes the real money off YouTube? Not Mr. Beast—Sundar Pichai.), and our government has shown very little interest in doing anything that would reduce their wealth and power. So, we can expect this, and everything else, to continue to get worse in exactly the way that cyberpunk fiction explicitly warned us it would, and our government continuing to do absolutely nothing about it!

This is fine.

A letter from the real singularity

Apr 5 JDN 246136

I’ve been unable to find it, but several years ago someone famous wrote a sci-fi work entitled something like “A letter from the post-singularity” about how great life is after AI takes over everything. Today I thought I’d write a more realistic take on the path we actually seem to be on.

The year is 2073. Technically we still don’t have true AGI; as far as we can tell, AI still isn’t actually sentient and AIs aren’t people. (Some of us wonder, though. Philosophers debate it.) But that doesn’t really matter, because all white-collar work has been completely automated, and so has any blue-collar work that doesn’t require fine dexterity or unusual expertise. Plumbers and electricians are still doing all right (though they do more of their work at data centers than homes these days); sometimes I wish I’d apprenticed to be an electrician. Then again, the world can still only support so many electricians. AI managers command AI-run asteroid mines to extract ores to transport with AI-run spacecraft to Mars where AI-run factories process those ores and fabricate chips for more AIs that more AI-run spacecraft carry to Earth to be installed in AI-run data centers. And each time one gets sold, some trillionaire’s number goes up, and that’s the only thing people like him have ever cared about in their lives.

There are of course a handful of super-brilliant, super-creative, or just super-lucky individuals who manage to get rich making art or music or books or video games or whatever, but the vast majority of people who do art are still starving artists, just as they’ve always been, I guess. And the AI-generated stuff is good enough now that most of the time people will just use that instead of paying extra for the “authentic” “artisanal” stuff. (And most people can’t even tell the difference anyway.)

Harvard and Oxford still have professors, but most universities have fully automated teaching and most of their administration—and yet somehow tuition is barely any cheaper now than it was in your time, even adjusted for inflation. And if you were thinking of becoming a professor yourself? You should probably just go play prediction markets or something; you’d have better odds. The number of research papers published every year is astronomical, but they’re all written and reviewed by AI, rarely if ever even read by any human being, and so it seems like the actual progress of scientific knowledge has pretty much ground to a halt. (Seriously, how are there still string theorists? It’s been a century.) I guess corporate R&D still keeps on improving those graphics cards somehow; maybe they’ve discovered something important, but if they have, they’re keeping it to themselves. And I keep reading about amazing advancements done by AIs (especially in pure math that I’m not sure anyone understands), but none of it actually ever seems to affect anyone’s actual lives.

As for me, I live on UBI. Like 90% of people do. It’s enough to rent a cheap apartment (but own a home? Are you serious? Only millionaires own homes.), buy basically-adequate food (as long as you don’t eat out too much anywhere that’s not fast food), and pay for all the subscriptions to media services and home assistants and whatnot. What you make on UBI will only buy you the ad-supported versions, so while my fridge will order milk for me (delivered by drone in a couple of hours) and my robot maid will cook breakfast, fold the laundry and put the dishes in the dishwasher, my fridge is also constantly running ads and my maid will intersperse targeted sales pitches into its casual conversation. Sometimes I think I should just get rid of it (her?) and do my own cooking and cleaning myself, so I would never be able to sell it for half what I paid for it. If I could make some extra money, maybe I could at least upgrade to the ad-free subscription for my maid. (The Pro subscription and hardware addons to make her your girlfriend are just gross, but I’m sure they make tons of money.)

Every year, some politician makes a big deal about how the UBI trust fund is draining and will be gone in ten years or whatever; but it’s obvious that all they’d have to do to fix that would be raise the taxes on trillionaires a little bit, yet somehow that never seems to happen. But they also don’t cut UBI payments either, except sometimes to reduce our cost-of-living adjustments. I dunno; maybe they will really cut UBI payments in a few years. Or maybe we’ll get lucky and they’ll actually raise taxes for once.

At least I wasn’t dumb enough to move to Mars, where “employment is guaranteed!” but you have to pay a subscription for your oxygen.

My worst days are probably… about as bad as your worst days. Frankly they couldn’t be much worse, because sometimes I just want to die. Like a lot of people on UBI, I feel like a burden on society, like the world would be better off without me. Medicaid won’t cover neuroregulator implants, so I still take pills for my depression; they’re probably better than the pills you could get, but they’re still far from perfect.

My best days are maybe better than yours, maybe worse; it depends, I guess. If you’ve got cancer, your days are probably worse than mine, because we can pretty easily treat most cancers now. But if you’re healthy and you’ve got a steady job and a tight-knit community where you live, I’m guessing your days are better.

I have access to faster computers and faster Internet than you can probably imagine; my understanding was that back in the day you had to wait for downloads sometimes? Or even sometimes wait for webpages to load? What was that like? And your storage was measured in gigabytes, not petabytes? Humanity has never been so connected; human beings have never been so isolated. I theory I can contact anyone in the Solar System at the speed of light, but in practice my friends and I always seem to have trouble keeping in touch. (Oddly, it’s my best friend who lives on a station over Ganymede that I seem to stay in touch with best; we have to write full-length emails, because there’s no way to have a conversation on a ping of an hour and a half. It feels like being an old-timey pen pal, I guess.)

It’s not all bad. Some things are definitely better these days.

People often live to be 110 or even 120 nowadays. (So you might still be alive when I write this.) Rarely does anyone seem to make it past that, though; aging is just… really hard to beat. (The Boomers are finally almost gone, but Gen X is still gonna be with us for awhile yet.) We’ve cured a lot of the diseases that were bad in your time, but not all of them. And sometimes only people rich enough to pay for their own healthcare can afford the cures.

Language barriers are pretty much gone. If I wanna read something that was written in Japanese or Xhosa, I just have an AI translate it, and the translations are good enough now that you’d have to be really deeply-versed in the language to find any problems with it. Like, okay, maybe I’m not getting all the subtle connotations of Japanese literature, but was I ever going to actually learn kanji to read the originals? No. That kind of thing is for people with crazy obsessions.)

Our video games are definitely way better than yours. Characters with AI personalities that adapt in real time to how you behave. Procedurally-generated open worlds that can literally expand to the size of entire planets. (Actually, I vaguely remember reading you had a couple games that did something like the second one? Minecraft and Factorio​, I think they were called? Impressive that you could pull that off on a gigaflop processor.) Worlds and factions that adapt to your actions and provide realistic consequences so that no two players’ experiences of the game are exactly the same. It’s easy to lose yourself in a game like that (especially if you’ve got a VR setup), and when you’re playing in such a rich, interesting world for hundreds of hours. you can sometimes forget how bleak things are back in the real world your flesh-and-blood body lives in. (But then you get hungry or have to pee and you get forced back into reality.)

Economists keep telling us that per-capita GDP and productivity have never been higher, and that we have access to all these wonderful goods and services that previous generations could scarcely even imagine.

But if that’s true, why do I sometimes just want to die?

The United States has stopped creating jobs—maybe forever?

Mar 29 JDN 246129

When the preliminary data for our job markets over the past few months were released, they looked all right. But after more careful analysis and better data has allowed us to revise the figures and do more accurate seasonal adjustments, the results are really quite shocking:

The United States has lost more jobs than it created for the last six months.

That is certainly something we’ve done before; it is indeed what tends to happen during recessions. But no recession has been declared, GDP seems to be growing normally, and unemployment still stands at a perfectly-reasonable 4.4%.

What’s going on here?

If you look at the employment levelthe absolute number of people employed—it looks shockingly flat since 2023.

From 2009 to 2019, US employment grew from 138 million to 159 million, growing at 1.4% per year. Obviously it collapsed during the 2020 recession, but then it recovered to 158 million by the end of 2022. It now stands at 163 million, only 0.7% growth per year since 2022. Since January 2025 it has actually fallen from a peak of 164 million.

Because our population is growing (albeit not as much as it once was, because immigration has collapsed after Trump’s crackdowns), this actually looks even worse when you consider the employment rate, the ratio between the number of people employed and the total population:

US employment peaked at 61.1% just before the 2020 recession, and has still not recovered to that level. It reached 60% in 2022, stayed around there through 2024, and then since then has actually declined, now to 59.3%. In fact, it was even higher in 2007 before the other big recession of my adult life (you know, it’s starting to feel like the economy hates Millennials in particular), reaching 63.3% before crashing and never recovering.

Yet our GDP growth looks fine!

Sure, it had a huge drop in the 2020 recession, but it grew very fast in the recovery, and since then has fluctuated a bit, but generally averaged about 2.5% per year—which is pretty good for a highly-developed country. We had negative growth in the first quarter of 2025 and slow growth in the fourth quarter, but the second and third quarter both had strong growth to make up for it. Overall real GDP growth for 2025 as a whole was a perfectly respectable 2.1%.

Even our unemployment rate looks fine—though with employment falling, it suggests more people are leaving the labor force instead of looking for jobs at all.

The only major industry that has actually shown strong employment growth over the last year is healthcare, growing 2.4%. Every other major industry grew 1% or less, or even shrank.

What would cause something like this?

This actually looks like what you’d expect to happen under technological unemployment: Productivity-enhancing technology allows GDP to increase even as employment falls.

But we haven’t actually had a surge in productivity. The massive—utterly irresponsible—rollout of AI technology has shown little, if any, effect at improving productivity. 3% of effort saved really isn’t that much, especially since a lot of people seem to overestimate how much AI tools help them.

Overall, our productivity growth looks… pretty normal, by historical standards:

Instead, what actually seems to be happening is what we might call techno-hype unemployment: Employers think that a massive productivity surge is around the corner, and they’ve already stopped hiring in anticipation of that.

Maybe they’re not even wrong about that! There is now some evidence that while initial adoption of AI reduces productivity, eventually it may increase productivity. (But we really haven’t had it long enough to be sure.)

Unemployment isn’t rising very much, not because people are finding jobs, but because people who already have jobs are generally keeping them, while people who don’t have jobs are basically giving up.

The hiring rate is now the lowest it has been since the 2020 recession—and not much higher than it was at the trough of the 2020 recession!

As far as I can tell, on our current path, one of two things will happen:

  1. The current paradigm of AI will work, and genuinely increase productivity.
  2. The current paradigm of AI will fail, and expected productivity gains will not materialize.

It turns out that neither possibility looks good for workers.

If AI succeeds, then businesses seem like they’re gonna just… stop hiring, especially entry-level positions that can be more readily replaced. People who already have senior positions may do just fine, or even make more money; but anyone fresh out of college, or even anyone whose career got derailed and is trying to start again, looks like they’ll just be… out of luck.

It’s every capitalist’s dream: To buy a machine that lets you never have to hire anyone ever again. And maybe, at last, they’ve found that Holy Grail.

On the other hand, if AI fails, the bubble will burst, the huge amount of investment that was previously driving the economy will suddenly dry up, and we will have a financial crisis and a recession. Businesses that were so sure they could replace their workers with AI will want to start hiring again, but won’t be able to, because no one can afford to buy anything and so nobody is making any revenue to pay employees with.

In many ways, the second one appears to be the preferable outcome, because at least it’s temporary. We would, sooner or later, recover from that recession and bring things back to normal. If AI ever actually works even half as well as most of the tech industry claims it will any minute, the most likely outcome seems to be launching us fully into a cyberpunk dystopia where a handful of trillionaires own everything and the rest of us struggle for scraps because our skills can now be replaced by machines.

This didn’t have to happen.

Even if AI is really going to be a transformational technology, we could have prepared for it better. We could have implemented policies that would ensure that people would continue to be provided for even as their labor was more and more replaced by machines. But that would have made the billionaires slightly less rich, and it sounded like “socialism” to ideologues, and the right-wing media convinced millions of people that even moving slightly in that direction would destroy all they held dear.

It’s not even too late! We could still turn it around, if those same people who stopped us from doing the right thing before weren’t still in charge of everything and richer than ever and just as effective as they ever were at deluding the masses.

I don’t know how to be optimistic about the future anymore. It feels like I’m watching the collapse of our entire civilization live in real time.

What would a world without poverty look like?

Mar 22 JDN 2461122

In my previous post I reflected on the ways that conventional measures of poverty seem inadequate—and that a richer understanding of poverty suggests that it is far more ubiquitous than such measures suggest.

In this post, I will ask: Given this richer understanding of poverty, what would a world without poverty look like? Is it something we can realistically hope to achieve?

In techno-utopian circles (looking at you again, Scott Alexander), it is common to speak of “post-scarcity”: A world where there is no poverty because resources are effectively unlimited.

I don’t think that’s possible.

Not for humans as we know them. Perhaps in a future where greed is a recognized and treatable psychiatric disorder, we could genuinely have an economy where people really just take whatever they want and it works out because nobody wants an unreasonable amount.

But the fact that there are people with hundreds of billions of dollars tells me that among humans as we know them, some people’s greed is just literally insatiable. Give them a moon and they’ll demand a planet; give them a planet and they’ll demand a solar system. Whatever they are getting out of more wealth (status? power? the dopamine hit of number go up?), they’re never going to stop getting it from even more wealth, no matter how much we give them. For if they were going to stop at a reasonable amount, they would have stopped four orders of magnitude ago.

So let’s try to imagine what a world would look like if it really had no poverty, but not by somehow producing such staggering amounts of wealth that everyone could literally take whatever they want.

I think the key is that it would require all basic material needs to be met.

Everyone would have, at minimum:

  • Clean air to breathe
  • Clean water to drink
  • Nutritious food to eat
  • Shelter from the elements
  • Security against theft and violence
  • Personal liberty and political representation
  • A basic education
  • A basic standard of healthcare

(I will note that these resonate quite closely with the UN Universal Declaration of Human Rights.)

Some of these needs can probably never be completely satisfied—there is an inherent tension between liberty and security which requires us to balance them against each other. A society with zero crime is a horrific totalitarian police state; a society with complete liberty is an equally horrific Hobbesian nightmare. But we have achieved, in most of the First World at least, a reasonable standard of security along with a great deal of liberty, and preserving that balance should be of a very high priority.

Even clean air and water would be difficult to satisfy perfectly: even if we pivot our whole economy to solar, wind, and nuclear power (as we very definitely should be doing!), some amount of pollution is probably necessary just to have a functioning industrial society. So we need to establish reasonable standards for what amounts of pollution exposure are safe, and effective mechanisms for ensuring that people are not exposed to pollution outside those standards—we have largely done the former, but seriously fail at the latter.

But probably the most difficult needs to satisfy are actually difficult to even define.

Just what constitutes a basic standard of education, and a basic standard of healthcare?

These seem like moving targets.

Let’s start with education:

Someone who is illiterate and can barely add two numbers together would be considered to have very poor education today, but would be considered completely average among peasants in the Middle Ages. Someone like me with a PhD has education well beyond what anyone had in the Middle Ages: While Oxford was already graduating doctors in the 12th century, those doctors didn’t have to write dissertations, and didn’t know nearly as much about the world as you must to earn a modern PhD. (Most of the mathematics required to get an economics PhD specifically literally had not been invented.)

So it’s conceivable that educational standards will continue to rise over time, especially if we are able to radically improve learning via new technologies. In the most extreme case, if everyone can just download knowledge like in The Matrix, then it wouldn’t be unreasonable to expect the average person to know as much as a typical PhD today in dozens of fields.

Suppose that such technology did exist. Would it be fair to consider someone poor if they didn’t have access to it?

Yes, I think it would.

Because if it’s really cheap and easy to give breathtakingly vast knowledge on a variety of subjects to anyone instantly, then letting some people have that while others do not puts those others at a severe disadvantage in life. If you must know how to solve partial differential equations to get a job, then someone who only made it through high school algebra isn’t going to be able to find jobs.

So I think what we’re really concerned about here is inequality: The education of a rich person should not be too much better than the education of a poor person, lest “meritocracy” simply reinforce the same generational inequality it was supposed to eliminate.

Now consider healthcare:

This, too, has radically improved over time. Indeed, I’m not really sure it’s fair to call Medieval doctors doctors at all; they lacked basic knowledge of human physiology and their intervention was as likely to hurt patients as to help them. Surgeons certainly existed: They knew how to amputate a gangrenous limb or suture a wound. (They did so without antiseptic, let alone anaesthetic!) But should you come to them with a fever or a headache, they would likely do you as much harm as good.

So we could imagine a world of Star Trek medicine, where you lie in a bed, get scanned for a few moments, and the doctor immediately knows what’s wrong with you and what kind of painless injection to give you to fix it.

Once again, we must ask: If you don’t have that, are you poor?

And again, I’m going to say yes.

If the technology exists to heal people this effortlessly, and some people get access to it while others do not, the latter are being allowed to suffer when their suffering could be easily alleviated.

But now we must consider: what if the technology exists, but it’s too expensive to use routinely?

Most technologies are like this when they are first invented. Over time, the technology improves (and the patents expire!) and they become cheaper and more widely available.

Unlike education, healthcare doesn’t usually impose large advantages on those who receive it—though it can, especially in a society where disabilities are not adequately accommodated.

So I think I’m prepared to allow “early adopters” of new medical technology, people who are rich enough to pay for advanced treatments before they are available to everyone—within certain limits. If some new treatment grants radically higher productivity or lifespan, then in fact I think we have a moral obligation to wait until it can be universally shared before we give it to anyone—precisely because of the risk of reinforcing generational inequality.

Once again, in our effort to define poverty, we end up returning to inequality: The rich should not be allowed to be too much healthier than the poor.

This definitely makes education and healthcare more complicated than the others.

While we can pretty clearly define how much food and water a human being needs to live, and we could provide it to everyone, and then nobody would be poor in terms of food or water.

But making nobody poor in terms of education and healthcare requires meeting a standard that may in fact increase over time, and it is no contradiction to imagine that someone living in the 31st century could be receiving better healthcare than I ever will and yet is still not receiving adequate healthcare based on the technology available.

Furthermore, that person demanding better healthcare is not being ungrateful or envious—they are quite reasonably demanding that society fairly allocate healthcare so that there aren’t some people who live in eternal youth while other people still die of old age.

Are they richer than I am? In some sense, perhaps. We could stipulate that in every material way they are better off than I am now. But there’s a treatment that could extend their life by centuries, and nobody’s giving it to them, because they can’t afford it—and that’s wrong. That makes them poor, and it makes their society unfair and unjust. It isn’t just a question of how many QALY they have; it’s also a question of what it would cost to give them a lot more.

But with all that said, I do believe that a world without poverty is possible.

In fact, I believe that technologically we could already provide that world, if we had the political will to do so. Maybe we don’t quite have the economic output to support it worldwide, but even that is not as far off as most people seem to think.

Providing an adequate standard of food and water, for example, we could already do with existing food supplies. It would cost about one-eighth of Elon Musk’s wealth per year, meaning that, with good stock returns (as he most certainly gets), he could very likely afford it by himself!

Clean air for all would be harder, but we are moving the right direction now that solar power is so cheap.

Universal liberty and security would require radical shifts in government in dozens of countries, so that one seems especially unlikely to happen any time soon—yet it is very definitely possible, and by construction only requires political change.

Universal education and healthcare would be very expensive, and most countries are too poor to really provide them on their own. They are not simply poor in money, but poor in skills: There aren’t enough doctors and teachers, and so we would need to use the ones we have to train up a new generation, and perhaps a new generation after that, before the world’s needs would really be met. (Fortunately, there are people trying to do this. But they don’t have enough resources to really achieve these goals.) So this is not a technological limitation, but it is an economic one; it will probably be at least another generation before we can solve this one.

What about universal shelter? Now there’s the rub. Even in prosperous First World countries, housing shortages and skyrocketing prices are keeping homeownership out of reach for tens of millions of people, and leaving hundreds of thousands outright homeless. We clearly do have the technology to produce enough homes, especially if we are prepared to build at high density; but the economic cost of doing so would be substantial, and our policymakers don’t seem at all willing to actually pay it. I think as long as housing is viewed as an asset one invests in rather than a good that one needs, this will continue to be the case.

The problem isn’t that we don’t have enough stuff. It’s that we are not sharing it properly.

The longest night

Dec 21 JDN 2461031

When this post goes live, it will be (almost exactly) the winter solstice in the Northern Hemisphere. In our culture, derived mainly from European influences, we associate this time of year with Christmas; but in fact solstice celebrations are much more ancient and universal than that. Humans have been engaging in some sort of ritual celebration—often involving feasts and/or gifts—around the winter solstice in basically every temperate region of the world for as far back as we are able to determine. (You don’t see solstice celebrations so much in tropical regions, because “winter” isn’t really a thing there; those cultures tend to adopt lunar or lunisolar calendars instead.) Presumably humans have been doing something along these lines for about as long as there have been humans to do them.

I think part of why solstice celebrations are so enduring is that the solstice has both powerful symbolism and practical significance. It is the longest night of the year, when the sky will be darkest for the longest time and light for the shortest—above the Arctic Circle, the night lasts 24 hours and the sky never gets light at all. But from that point forward, the light will start to return. The solstice also heralds the start of the winter months, when the air is cold enough to be dangerous and food becomes much scarcer.

Of course, today we don’t have to worry about that so much: We have electric heating and refrigeration, so we can stay warm inside and eat pretty much whatever we want all year round. The practical significance, then, of the solstice has greatly decreased for us.

Yet it’s still a very symbolic time: The darkness is at its worst, the turning point is reached, the light will soon return. And when we reflect on how much safer we are than our ancestors were during this time of year, we may find it in our hearts to feel some gratitude for how far humanity has come—even if we still have terribly far yet to go.

And this year, in particular, I think we are seeing the turning point for a lot of darkness. The last year especially has been a nightmare for, well, the entire free world—not to mention all the poor countries who depended on us for aid—but at last it seems like we are beginning to wake from that nightmare. Within margin of error, Trump’s approval rating is at the lowest it has ever been, about 43% (still shockingly high, I admit), and the Republicans seem to be much more divided and disorganized than they were just a year ago, some of them even openly defying Trump instead of bowing at his every word.

Of course, while the motions of the Earth are extraordinarily regular and predictable, changes in society are not. The solstice will certainly happen on schedule, and the days will certainly get longer for the next six months after that—I’d give you million-to-one odds on either proposition. (Frankly, if I ever had to pay, we’d probably have bigger problems!)

But as far as our political, economic, and cultural situation, things could get very well get worse again before they get better. There’s even a chance they won’t get better, that it’s all downhill from here—but I believe those chances are very small. Things are not so bleak as that.

While there have certainly been setbacks and there will surely be more, on the whole humanity’s trajectory has been upward, toward greater justice and prosperity. Things feel so bad right now, not so much because they are bad in absolute terms (would you rather live as a Roman slave or a Medieval peasant?), but because this is such a harsh reversal in an otherwise upward trend—and because we can see just how easy it would be to do even better still, if the powers that be had half the will to do so.

So here’s hoping that on this longest night, at least some of the people with the power to make things better will see a little more of the light.

What we still have to be thankful for

Nov 30 JDN 2461010

This post has been written before, but will go live after, Thanksgiving.

Thanksgiving is honestly a very ambivalent holiday.

The particular event it celebrates don’t seem quite so charming in their historical context: Rather than finding peace and harmony with all Native Americans, the Pilgrims in fact allied with the Wampanoag against the Narragansett, though they did later join forces with the Narragansett in order to conquer the Pequot. And of course we all know how things went for most Native American nations in the long run.

Moreover, even the gathering of family comes with some major downsides, especially in a time of extreme political polarization such as this one. I won’t be joining any of my Trump-supporting relatives for dinner this year (and they probably wouldn’t have invited me anyway), but the fact that this means becoming that much more detached from a substantial part of my extended family is itself a tragedy.

This year in particular, US policy has gotten so utterly horrific that it often feels like we have nothing to be thankful for at all, that all we thought was good and just in the world could simply be torn away at a moment’s notice by raving madmen. It isn’t really quite that bad—but it feels that way sometimes.

It also felt a bit uncanny celebrating Thanksgiving a few years ago when we were living in Scotland, for the UK does not celebrate Thanksgiving, but absolutely does celebrate Black Friday: Holidays may be local, but capitalism is global.

But fall feasts of giving thanks are far more ancient than that particular event in 1621 that we have mythologized to oblivion. They appear in numerous cultures across the globe—indeed their very ubiquity may be why the Wampanoag were so willing to share one with the Pilgrims despite their cultures having diverged something like 40,000 years prior.

And I think that it is by seeing ourselves in that context—as part of the whole of humanity—that we can best appreciate what we truly do have to be thankful for, and what we truly do have to look forward to in the future.

Above all, medicine.

We have actual treatments for some diseases, even actual cures for some. By no means all, of course—and it often feels like we are fighting an endless battle even against what we can treat.

But it is worth reflecting on the fact that aside from the last few centuries, this has simply not been the case. There were no actual treatments. There was no real medicine.

Oh, sure, there were attempts at medicine; and there was certainly what we would think of as more like “first aid”: bandaging wounds, setting broken bones. Even amputation and surgery were done sometimes. But most medical treatment was useless or even outright harmful—not least because for most of history, most of it was done without anesthetic or even antiseptic!

There were various herbal remedies for various ailments, some of which even have happened to work: Willow bark genuinely helps with pain, St. John’s wort is a real antidepressant, and some traditional burn creams are surprisingly effective.

But there was no system in place for testing medicine, no way of evaluating what remedies worked and what didn’t. And thus, for every remedy that worked as advertised, there were a hundred more that did absolutely nothing, or even made things worse.

Today, it can feel like we are all chronically ill, because so many of us take so many different pills and supplements. But this is not a sign that we are ill—it is a sign that we can be treated. The pills are new, yes—but the illnesses they treat were here all along.

I don’t see any particular reason to think that Roman plebs or Medieval peasants were any less likely to get migraines than we are; but they certainly didn’t have access to sumatriptan or rimegepant. Maybe they were less likely to get diabetes, but mainly because they were much more likely to be malnourished. (Well, okay, also because they got more exercise, which we surely could stand to.) And they only reason they didn’t get Alzheimer’s was that they usually didn’t live long enough.

Looking further back, before civilization, human health actually does seem to have been better: Foragers were rarely malnourished, weren’t exposed to as many infectious pathogens, and certainly got plenty of exercise. But should a pathogen like smallpox or influenza make it to a forager tribe, the results were often utterly catastrophic.

Today, we don’t really have the sort of plague that human beings used to deal with. We have pandemics, which are also horrible, but far less so. We were horrified by losing 0.3% of our population to COVID; a society that had only suffered 0.3%—or even ten times that, 3%—losses from the Black Death would have been hailed as a miracle, for a more typical rate was 30%.

At 0.3%, most of us knew somebody, or knew somebody who knew somebody, who died from COVID. At 3%, nearly everyone would know somebody, and most would know several. At 30%, nearly everyone would have close family and friends who died.

Then there is infant mortality.

As recently as 1950—this is living memory—the global infant mortality rate was 14.6%. This is about half what it had been historically; for most of human history, roughly a third of all children died between birth and the age of 5.

Today, it is 2.5%.

Where our distant ancestors expected two out of three of their children to survive and our own great-grandparents expected five out of six can now safely expect thirty-nine out of forty to live. This is the difference between “nearly every family has lost a child” and “most families have not lost a child”.

And this is worldwide; in highly-developed countries it’s even better. The US has a relatively high infant mortality rate by the standards of highly-developed countries (indeed, are we even highly-developed, or are we becoming like Saudi Arabia, extremely rich but so unequal that it doesn’t really mean anything to most of our people?). Yet even for us, the infant mortality rate is 0.5%—so we can expect one-hundred-ninety-nine out of two-hundred to survive. This is at the level of “most families don’t even know someone who has lost a child.”

Poverty is a bit harder to measure.

I am increasingly dubious of conventional measures of poverty; ever since compiling my Index of Necessary Expenditure, I am convinced that economists in general, and perhaps US economists in particular, are systematically underestimating the cost of living and thereby underestimating the prevalence of poverty. (I don’t think this is intentional, mind you; I just think it’s a result of using convenient but simplistic measures and not looking too closely into the details.) I think not being able to sustainably afford a roof over your head constitutes being poor—and that applies to a lot of people.

Yet even with that caveat in mind, it’s quite clear that global poverty has greatly declined in the long run.

At the “extreme poverty” level, currently defined as consuming $1.90 at purchasing power parity per day—that’s just under $700 per year, less than 2% of the median personal income in the United States—the number of people has fallen from 1.9 billion in 1990 to about 700 million today. That’s from 36% of the world’s population to under 9% today.

Now, there are good reasons to doubt that “purchasing power parity” really can be estimated as accurately as we would like, and thus it’s not entirely clear that people living on “$2 per day PPP” are really living at less than 2% the standard of living of a typical American (honestly to me that just sounds like… dead); but they are definitely living at a much worse standard of living, and there are a lot fewer people living at such low standard of living today than there used to be not all that long ago. These are people who don’t have reliable food, clean water, or even basic medicine—and that used to include over a third of humanity and does no longer. (And I would like to note that actually finding such a person and giving them a few hundred dollars absolutely would change their life, and this is the sort of thing GiveDirectly does. We may not know exactly how to evaluate their standard of living, but we do know that the actual amount of money they have access to is very, very small.)

There are many ways in which the world could be better than it is.

Indeed, part of the deep, overwhelming outrage I feel pretty much all the time lies in the fact that it would be so easy to make things so much better for so many people, if there weren’t so many psychopaths in charge of everything.


Increased foreign aid is one avenue by which that could be achieved—so, naturally, Trump cut it tremendously. More progressive taxation is another—so, of course, we get tax cuts for the rich.

Just think about the fact that there are families with starving children for whom a $500 check could change their lives; but nobody is writing that check, because Elon Musk needs to become a literal trillionaire.

There are so many water lines and railroad tracks and bridges and hospitals and schools not being built because the money that would have paid for them is tied up in making already unfathomably-rich people even richer.

But even despite all that, things are getting better. Not every day, not every month, not even every year—this past year was genuinely, on net, a bad one. But nearly every decade, every generation, and certainly every century (for at least the last few), humanity has fared better than we did the last.

As long as we can keep that up, we still have much to hope for—and much to be thankful for.

What is the real impact of AI on the environment?

Oct 19 JDN 2460968

The conventional wisdom is that AI is consuming a huge amount of electricity and water for very little benefit, but when I delved a bit deeper into the data, the results came out a lot more ambiguous. I still agree with the “very little benefit” part, but the energy costs of AI may not actually be as high as many people believe.

So how much energy does AI really use?

This article in MIT Technology Reviewestimates that by 2028, AI will account for 50% of data center usage and 6% of all US energy. But two things strike me about that:

  1. This is a forecast. It’s not what’s currently happening.
  2. 6% of all US energy doesn’t really sound that high, actually.

Note that transportation accounts for 37% of US energy consumed. Clearly we need to bring that down; but it seems odd to panic about a forecast of something that uses one-sixth of that.

Currently, AI is only 14% of data center energy usage. That forecast has it rising to 50%. Could that happen? Sure. But it hasn’t happened yet. Data centers are being rapidly expanded, but that’s not just for AI; it’s for everything the Internet does, as more and more people get access to the Internet and use it for more and more demanding tasks (like cloud computing and video streaming).

Indeed, a lot of the worry really seems to be related to forecasts. Here’s an even more extreme forecast suggesting that AI will account for 21% of global energy usage by 2030. What’s that based on? I have no idea; they don’t say. The article just basically says it “could happen”; okay, sure, a lot of things could happen. And I feel like this sort of forecast comes from the same wide-eyed people who say that the Singularity is imminent and AI will soon bring us to a glorious utopia. (And hey, if it did, that would obviously be worth 21% of global energy usage!)

Even more striking to me is the fact that a lot of other uses of data centers are clearly much more demanding. YouTube uses about 50 times as much energy as ChatGPT; yet nobody seems to be panicking that YouTube is an environmental disaster.

What is a genuine problem is that data centers have strong economies of scale, and so it’s advantageous to build a few very large ones instead of a lot of small ones; and when you build a large data center in a small town it puts a lot of strain on the local energy grid. But that’s not the same thing as saying that data centers in general are wastes of energy; on the contrary, they’re the backbone of the Internet and we all use them almost constantly every day. We should be working on ways to make sure that small towns aren’t harmed by building data centers near them; but we shouldn’t stop building data centers.

What about water usage?

Well, here’s an article estimating that training ChatGPT-3 evaporated hundreds of thousands of liters of fresh water. Once again I have a few notes about that:

  1. Evaporating water is just about the best thing you could do to it aside from leaving it there. It’s much better than polluting it (which is what most water usage does); it’s not even close. That water will simply rain back down later.
  2. Total water usage in the US is estimated at over 300 billion gallons (1.1 trillion liters) per day. Most of that is due to power generation and irrigation. (The best way to save water as a consumer? Become vegetarian—then you’re getting a lot more calories per irrigated acre.)
  3. A typical US household uses about 100 gallons (380 liters) of water per person per day.

So this means that training ChatGPT-3 cost about 4 seconds of US water consumption, or the same as what a single small town uses each day. Once again, that doesn’t seem like something worth panicking over.

A lot of this seems to be that people hear big-sounding numbers and don’t really have the necessary perspective on those numbers. Of course any service that is used by millions of people is going to consume what sounds like a lot of electricity. But in terms of usage per person, or compared to other services with similar reach, AI really doesn’t seem to be uniquely demanding.

This is not to let AI off the hook.

I still agree that the benefits of AI have so far been small, and the risks—both in the relatively short term, of disrupting our economy and causing unemployment, and in the long term, even endangering human civilization itself—are large. I would in fact support an international ban on all for-profit and military research and development of AI; a technology this powerful should be under the control of academic institutions and civilian governments, not corporations.

But I don’t think we need to worry too much about the environmental impact of AI just yet. If we clean up our energy grid (which has just gotten much easier thanks to cheap renewables) and transportation systems, the additional power draw from data centers really won’t be such a big problem.

Taylor Swift and the means of production

Oct 5 JDN 2460954

This post is one I’ve been meaning to write for awhile, but current events keep taking precedence.

In 2023, Taylor Swift did something very interesting from an economic perspective, which turns out to have profound implications for our economic future.

She re-recorded an entire album and released it through a different record company.

The album was called 1989 (Taylor’s Version), and she created it because for the last four years she had been fighting with Big Machine Records over the rights to her previous work, including the original album 1989.

A Marxist might well say she seized the means of production! (How rich does she have to get before she becomes bourgeoisie, I wonder? Is she already there, even though she’s one of a handful of billionaires who can truly say they were self-made?)

But really she did something even more interesting than that. It was more like she said:

Seize the means of production? I am the means of production.”

Singing and songwriting are what is known as a human-capital-intensive industry. That is, the most important factor of production is not land, or natural resources, or physical capital (yes, you need musical instruments, amplifiers, recording equipment and the like—but these are a small fraction of what it costs to get Talor Swift for a concert), or even labor in the ordinary sense. It’s one where so-called (honestly poorly named) “human capital” is the most important factor of production.

A labor-intensive industry is one where you just need a lot of work to be done, but you can get essentially anyone to do it: Cleaning floors is labor-intensive. A lot of construction work is labor-intensive (though excavators and the like also make it capital-intensive).

No, for a human-capital-intensive industry, what you need is expertise or talent. You don’t need a lot of people doing back-breaking work; you need a few people who are very good at doing the specific thing you need to get done.

Taylor Swift was able to re-record and re-release her songs because the one factor of production that couldn’t be easily substituted was herself. Big Machine Records overplayed their hand; they thought they could control her because they owned the rights to her recordings. But she didn’t need her recordings; she could just sing the songs again.

But now I’m sure you’re wondering: So what?

Well, Taylor Swift’s story is, in large part, the story of us all.

For most of the 18th, 19th, and 20th centuries, human beings in developed countries saw a rapid increase in their standard of living.

Yes, a lot of countries got left behind until quite recently.

Yes, this process seems to have stalled in the 21st century, with “real GDP” continuing to rise but inequality and cost of living rising fast enough that most people don’t feel any richer (and I’ll get to why that may be the case in a moment).

But for millions of people, the gains were real, and substantial. What was it that brought about this change?

The story we are usually told is that it was capital; that as industries transitioned from labor-intensive to capital-intensive, worker productivity greatly increased, and this allowed us to increase our standard of living.

That’s part of the story. But it can’t be the whole thing.

Why not, you ask?

Because very few people actually own the capital.

When capital ownership is so heavily concentrated, any increases in productivity due to capital-intensive production can simply be captured by the rich people who own the capital. Competition was supposed to fix this, compelling them to raise wages to match productivity, but we often haven’t actually had competitive markets; we’ve had oligopolies that consolidate market power in a handful of corporations. We had Standard Oil before, and we have Microsoft now. (Did you know that Microsoft not only owns more than half the consumer operating system industry, but after acquiring Activision Blizzard, is now the largest video game company in the world?) In the presence of an oligopoly, the owners of the capital will reap the gains from capital-intensive productivity.

But standards of living did rise. So what happened?

The answer is that production didn’t just become capital-intensive. It became human-capital-intensive.

More and more jobs required skills that an average person didn’t have. This created incentives for expanding public education, making workers not just more productive, but also more aware of how things work and in a stronger bargaining position.

Today, it’s very clear that the jobs which are most human-capital-intensive—like doctors, lawyers, researchers, and software developers—are the ones with the highest pay and the greatest social esteem. (I’m still not 100% sure why stock traders are so well-paid; it really isn’t that hard to be a stock trader. I could write you an algorithm in 50 lines of Python that would beat the average trader (mostly by buying ETFs). But they pretend to be human-capital-intensive by hiring Harvard grads, and they certainly pay as if they are.)

The most capital-intensive industries—like factory work—are reasonably well-paid, but not that well-paid, and actually seem to be rapidly disappearing as the capital simply replaces the workers. Factory worker productivity is now staggeringly high thanks to all this automation, but the workers themselves have gained only a small fraction of this increase in higher wages; by far the bigger effect has been increased profits for the capital owners and reduced employment in manufacturing.

And of course the real money is all in capital ownership. Elon Musk doesn’t have $400 billion because he’s a great engineer who works very hard. He has $400 billion because he owns a corporation that is extremely highly valued (indeed, clearly overvalued) in the stock market. Maybe being a great engineer or working very hard helped him get there, but it was neither necessary nor sufficient (and I’m sure that his dad’s emerald mine also helped).

Indeed, this is why I’m so worried about artificial intelligence.

Most forms of automation replace labor, in the conventional labor-intensive sense: Because you have factory robots, you need fewer factory workers; because you have mountaintop removal, you need fewer coal miners. It takes fewer people to do the same amount of work. But you still need people to plan and direct the process, and in fact those people need to be skilled experts in order to be effective—so there’s a complementarity between automation and human capital.

But AI doesn’t work like that. AI substitutes for human capital. It doesn’t just replace labor; it replaces expertise.

So far, AI is currently too unreliable to replace any but entry-level workers in human-capital-intensive industries (though there is some evidence it’s already doing that). But it will most likely get more reliable over time, if not via the current LLM paradigm, than through the next one that comes after. At some point, AI will come to replace experienced software developers, and then veteran doctors—and I don’t think we’ll be ready.

The long-term pattern here seems to be transitioning away from human-capital-intensive production to purely capital-intensive production. And if we don’t change the fact that capital ownership is heavily concentrated and so many of our markets are oligopolies—which we absolutely do not seem poised to do anything about; Democrats do next to nothing and Republicans actively and purposefully make it worse—then this transition will be a recipe for even more staggering inequality than before, where the rich will get even more spectacularly mind-bogglingly rich while the rest of us stagnate or even see our real standard of living fall.

The tech bros promise us that AI will bring about a utopian future, but that would only work if capital ownership were equally shared. If they continue to own all the AIs, they may get a utopia—but we sure won’t.

We can’t all be Taylor Swift. (And if AI music catches on, she may not be able to much longer either.)

The AI bubble is going to crash hard

Sep 7 JDN 2460926

Based on the fact that it only sort of works and yet corps immediately put it in everything, I had long suspected that the current wave of AI was a bubble. But after reading Ed Zitron’s epic takedowns of the entire industry, I am not only convinced it’s a bubble; I’m convinced it is probably the worst bubble we’ve had in a very long time. This isn’t the dot-com crash; it’s worse.

The similarity to the dot-com crash is clear, however: This a huge amount of hype over a new technology that genuinely could be a game-changer (the Internet certainly was!), but won’t be in the time horizon on which the most optimistic investors have assumed it will be. The gap between “it sort of works” and “it radically changes our economy” is… pretty large, actually. It’s not something you close in a few years.


The headline figure here is that based on current projections, US corporations will have spent $560 billion on capital expenditure, for anticipated revenue of only $35 billion.

They won’t pay it off for 16 years!? That kind of payoff rate would make sense for large-scale physical infrastructure, like a hydroelectric dam. It absolutely does not make sense in an industry that is dependent upon cutting-edge technology that wears out fast and becomes obsolete even faster. They must think that revenue is going to increase to something much higher, very soon.

The corps seem to be banking on the most optimistic view of AI: That it will soon—very soon—bring about a radical increase in productivity that brings GDP surging to new heights, or even a true Singularity where AI fundamentally changes the nature of human existence.

Given the kind of errors I’ve seen LLMs make when I tried to use them to find research papers or help me with tedious coding, this is definitely not what’s going to happen. Claude gives an impressive interview, and (with significant guidance and error-correction) it also managed pretty well at making some simple text-based games; but it often recommended papers to me that didn’t exist, and through further experimentation, I discovered that it could not write me a functional C++ GUI if its existence depended on it. Somewhere on the Internet I heard someone describe LLMs as answering not the question you asked directly, but the question, “What would a good answer to this question look like?” and that seems very accurate. It always gives an answer that looks valid—but not necessarily one that is valid.

AI will find some usefulness in certain industries, I’m sure; and maybe the next paradigm (or the one after that) will really, truly, effect a radical change on our society. (Right now the best thing to use LLMs for seems to be cheating at school—and it also seems to be the most common use. Not exactly the great breakthrough we were hoping for.) But LLMs are just not reliable enough to actually use for anything important, and sooner or later, most of the people using them are going to figure that out.

Of course, by the Efficient Roulette Hypothesis, it’s extremely difficult to predict exactly when a bubble will burst, and it could well be that NVIDIA stock will continue to grow at astronomical rates for several years yet—or it could be that the bubble bursts tomorrow and NVIDIA stock collapses, if not to worthless, then to far below its current price.

Krugman has an idea of what might be the point that bursts the bubble: Energy costs. There is a clear mismatch between the anticipated energy needs of these ever-growing data centers and the actual energy production we’ve been installing—especially now that Trump and his ilk have gutted subsidies for solar and wind power. That’s definitely something to watch out for.

But the really scary thing is that the AI bubble actually seems to be the only thing holding the US economy above water right now. It’s the reason why Trump’s terrible policies haven’t been as disastrous as economists predicted they would; our economy is being sustained by this enormous amount of capital investment.

US GDP is about $30 trillion right now, but $500 billion of that is just AI investment. That’s over 1.6%, and last quarter our annualized GDP growth rate was 3.3%—so roughly half of our GDP growth was just due to building more data centers that probably won’t even be profitable.

Between that, the tariffs, the loss of immigrants, and rising energy costs, a crashing AI bubble could bring down the whole stock market with it.

So I guess what I’m saying is: Don’t believe the AI hype, and you might want to sell some stocks.