A not-so-done deal

 

Pick up where we left off in June. 

As is so often the case, this story in the New York Times is less of interest for the facts, which have been reported earlier and in greater depth by other news organizations such as NPR, Reuters, CNBC, Variety, The Hollywood Reporter, and others, than it is for what it tells us about the standard narrative.

 States Prepare Lawsuit to Block Paramount’s Merger With Warner Bros.

David McCabe, Benjamin Mullin, Lauren Hirsch

 

July 12, 2026

A group of states are preparing to file a lawsuit to block Paramount’s acquisition of Warner Bros. Discovery as soon as this week, according to four people briefed on the plans, a legal challenge that would create a major obstacle for one of the biggest media mergers in history.

A draft of the lawsuit currently circulating argues that the $111 billion deal would harm competition in the market for so-called tent pole films, the expensive blockbusters that make up a large portion of studio revenues, among other claims, two of the people said.

California has taken the lead on the lawsuit, and states including New York, Washington and Connecticut have said they will join the effort, according to three of the people, as well as another person familiar with the states’ plans. All of them spoke on condition of anonymity to discuss a sensitive legal matter before it was public.

[I don't want to get too sidetracked into bitching about the Gray Lady, but how can it take three credited reporters to write an account so superficial it doesn't even mention the state which has most aggressively pursued this story?] 

Once the lawsuit is finalized, the states could decide to delay filing it or scrap it completely. Reuters earlier reported states could sue as soon as this week.

A spokeswoman for Paramount said in a statement that the company was prepared to address “legitimate antitrust issues,” adding that its merger with Warner Bros. Discovery “raises no such concerns.”

“We are confident the facts and the law support this transaction, and we will continue to defend it vigorously,” she added.

Paramount has said it plans to close the deal in the third quarter of the year. As part of its deal with Warner Bros. Discovery, Paramount has said it would pay the company’s shareholders about $650 million in cash for each quarter the deal doesn’t close, starting in October.

...

 

Internationally, the company has already secured approvals from more than 20 countries and regions, including China and Australia. Some international regulators must still approve the deal, including Britain. In June, a British official said her government was leaning toward examining the acquisition.

...

In filings last month related to a separate brought by streaming subscribers seeking to block the deal, Paramount executives said in sworn declarations that they planned to release at least 30 movies in theaters annually and keep new releases in theaters for at least 45 days before putting them on streaming platforms.

[A bit more bitching. It's true that  Paramount executives said this but literally ten minutes of research would reveal that virtually no one outside of the company believes this is possible. This huge surge in production would have to happen while the company is forced to slash costs to deal with $79 billion in debt just as Fitch has just downgraded the company's credit rating to junk status.] 

Up until recently, the Ellisons and their allies had managed to successfully sell the idea that the merger was a done deal. Resistance was futile. It is time to accept your new overlords. This created a situation where the greatest barrier the opposition faced was the belief that there was nothing the opposition could do. When the NYT runs something like this, you know that narrative is shifting.

Of course, positive thinking only gets you so far. The odds of the merger going through are still quite good, just not the slam dunk that much of the press has credulously repeated up to this point.

There are all sorts of fascinating moving parts here that you would know about if you got your news from the previously mentioned news organizations. This is more than just an antitrust story, with Middle Eastern sovereign wealth fund money making up something like half of the funding, which normally would be considered illegal. There is the previously mentioned Oregon investigation into corruption. Then there are all sorts of interesting aspects to the financing and the timing. The "ticking fee" is still a ways off, but it's not trivial, particularly if Ed Zitron proves to be prescient with respect to the near future of Oracle. Larry Ellison has committed to put up tens of billions of dollars that he might not have at some point.

A lack of qualifications is not a qualification and other thoughts on Platner

Picking up from Joseph's post.

Not being from Maine, I didn't spend a lot of time reading or writing about the Senate primary. Here are, I believe, the entirety of my social media posts on the subject. If you look closely, you might spot something of a common theme.

Anyone else getting a Fetterman vibe here?

— markpalko.bsky.social (@markpalko.bsky.social) October 25, 2025 at 9:40 PM

Sinema was an unconventional candidate who was going to bring in young voters. Fetterman was an unconventional candidate who was going to bring in young voters. Starting to question that particular argument.

— markpalko.bsky.social (@markpalko.bsky.social) October 24, 2025 at 8:56 PM

Like I said: Sinema was an unconventional candidate who was going to bring in young voters. Fetterman was an unconventional candidate who was going to bring in young voters. Platner was an unconventional candidate who was going to bring in young voters. Starting to question that particular argument

[image or embed]

— markpalko.bsky.social (@markpalko.bsky.social) January 8, 2026 at 12:54 AM

You would think the normal reaction to how Fetterman turned out would be "how can we avoid this happening again?" not "let's give it one more try."

[image or embed]

— markpalko.bsky.social (@markpalko.bsky.social) March 4, 2026 at 8:09 PM

I still think the relevant comparison here is Sinema/Fetterman. We see the same anti-establishment framing, the same arguments about the need to select an outsider, in many cases the same people pushing the candidacy. What I want to know is how people still think this is a good idea.

— markpalko.bsky.social (@markpalko.bsky.social) April 12, 2026 at 3:49 PM

He's an enormously problematic candidate brought to us by literally the same people (such as Morris Katz) who brought us Fetterman, using many of the same arguments. If you can convince me that Fetterman was a good choice, I'll send Platner a check.

— markpalko.bsky.social (@markpalko.bsky.social) March 4, 2026 at 8:58 PM

All sorts of big issues are raised by this story—too many to list—but for now, here is a quick list, starting with the recurrent theme of my social media thread.

One of the silliest and most dangerous political ideas to emerge in the past few years is the notion that the best qualification for high public office is a lack of qualifications.

Not being a professional politician has a certain gut-level populist appeal, but it is almost never a positive, particularly when it is combined with a lack of any relevant experience. And no, "my parents bought me an oyster farm" is not sufficient.

This raises another point that I find particularly annoying. I grew up, if not poor, then certainly frugal, in the rural South. Perhaps for that reason, I have always had exceptionally little patience with the fake man-of-the-people schtick. It shows a cynicism and a disdain for voters that I find deeply offensive.

Poor-boy cosplay also provides an area of vulnerability in the general election, which leads to yet another issue. Non-politicians are almost always non-vetted. While it's true we can't always assume the flip side—that elected officials have been well vetted (Swalwell slipped past voters for years)—as a general rule, the bigger and tougher the races someone has won, the more difficult it is to dig up dirt.

It's important to note that Platner never even made it to the general election, where the really nasty rat-fuckers were sharpening their knives. Instead, the damaging stories started coming out almost immediately, possibly even organically, and simply picked up steam. It was less like a drip, drip, drip and more like a growing stream, with progressively worse details constantly emerging. I'm reminded of the scene in the Buster Keaton film where, starting with a few pebbles, progressively larger rocks come tumbling down the hill toward the hapless protagonist.

Much of this dirt was disturbingly close to the surface. A halfway diligent background check, along with a few hours of Internet searching, would have revealed much of it. A competent campaign would have been able to get ahead of many of these stories rather than just trying to dodge each rock individually.

Good journalism, another key component of a well-functioning primary system, would have brought lots of these things out in a more timely manner. If you read papers like the New York Times today, you will find all sorts of sharp reporting focused on the failed candidate, but at the time the vast majority of news organizations were more than content to simply play along with the simple "oyster man takes on the political establishment and wins" narrative.

It wasn't until after he became the presumptive nominee that we started seeing the right questions being asked, and not until the days after the vote that we saw aggressive digging.

Last July, in a small town in coastal Maine, a couple of progressive, self-styled recruiters of economic populists showed up at the blue-shingled house of Graham Platner, a little-known oyster farmer and Marine veteran who lived largely off government benefits.

They knew his name from local labor organizers and activists, and they had watched a video on the internet of him talking about oysters. Struck by his left-leaning ideology, his working-class affect and his gravelly voice, they became convinced that he could win a Senate seat in Maine — and quickly persuaded Mr. Platner of the same.

The initial headhunters, Dan Moraff and Leanne Fan, and then a third out-of-state operative they called up to Maine — Morris Katz — told Mr. Platner he was “the one,” a “hero of the movement,” “a historical figure” who could be “leading a revolution,” according to half a dozen people with knowledge of their conversations.

But a clutch of people who cared about Mr. Platner were telling him something else. They worried about his mental health, amid his ongoing efforts to heal from post-traumatic stress disorder after tours in Iraq and Afghanistan. They feared this trio of out-of-state operatives was a dangerous combination of inexperienced and overconfident. The worst-case scenario, they thought, wasn’t running for Senate and losing — it was destroying the life he worked hard to build.

 

 The NYT started this piece with their usual self-congratulatory spiel talking about how thoroughly they investigated the story, but while I appreciate professional reporting, I'd appreciate professional reporting done in a timely fashion (say eight months ago) a hell of a lot more. At the risk of being both preachy and obvious, one of the most important roles of journalism is informing voters. Waiting until the die has already been cast is often easier and safer, but it defeats the purpose.

The Maine primary was a textbook case of how not to select a nominee. What needs to be a process of scrutiny and skepticism, especially with an untested candidate, instead became a bizarre rush to declare the matter settled months in advance, even while increasingly damaging revelations were steadily coming forward. There seemed to be a widespread fear that if we let the primary do what it was supposed to, we would somehow damage our chances of unseating Collins.

For me, that might be the final and most important lesson. When you tell yourself that a vigorous democratic process is too risky, you are wrong on principle and stupid in practice.

A concession to Mark about outsider candidates

This is Joseph.

So, credit where credit is due, Mark called the issues with Graham Platner early on. But one thing that still amazes me about all of this is the strange alignment of the left in it. 

Matt Yglesias:

And 

It really goes to the central question of "what are the goals of the organization?" and I think it is quite clear that it isn't a resistance movement against Donald Trump. Why am I so sure? 

When is the last time you saw people protesting Trump over Gaza? Has the Israeli occupation improved greatly since he took power? But you see them protesting the out of power Democrat senators from New York. There was some sort of plausible ambiguity when Biden was president. Perhaps the protesters were so certain that Biden (or Harris) would win that they focused on shifting policy with-in the Democratic party. This would be naive but at least plausible. Meanwhile, the current administration actually started a war with a different middle eastern country (Iran) and we still don't have that as the focus. 

But it is now looking a lot like a faction prioritizing power in the Democrat's coalition at the expense of fighting MAGA, and yet branding themselves as the fighters. This strategy seems dangerous in a moment where the current president is very much opposed to all of the things that this faction seems to want. I suppose there could be a "heighten the contradictions plan" but, keep in mind, contradictions can be heightened for decades (or even centuries) causing much misery and no immediate revolutions. 

I think we should listen to Mark and be much more skeptical about outsider candidates without background, vetting, or clear policy objectives. 

P.S. And the candidate is not going quietly which only reinforces the intuition that the game is not winning versus the Republicans . . . 

I probably should have worked in a Matrix reference

Following up on this week's sci-fi, folklore, magic theme.

From Internet of Bugs Carl Brown:

But predicting what humanity would do in the future is only the beginning of the powers of a Super-AI.

I’ll quote here from “The AI Does Not Hate You” by Tom Chivers about a future AI called “Basilisk”:

...the Basilisk is saying, ‘If you work to bring me about as fast as possible, I won’t create a perfect copy of your mind and torture it for billions of subjective years.’ (The argument is that since a perfect copy of your mind would essentially be you, this is equivalent to bringing you back to life.) In essence, a thing that doesn’t exist yet may be blackmailing you from the future, threatening to punish you for not working hard enough to make it exist.

I only wish I were kidding. This belief (which is often called “Roko’s Basilisk”16 ) is even more unhinged than it sounds, and it comes from the website of one of the authors of IF ANYONE BUILDS IT EVERYONE DIES, and that author “Eliezer Yudkowsky, banned discussion of Roko’s basilisk on the blog for several years as part of a general site policy against spreading potential information hazards.”17 Luckily for posterity, those discussions are retained on the Internet Archive18, and the original post can be found replicated elsewhere19, so if you really want to - although I don’t recommend it - you can follow the links I’ve included below so you can see what kind of crazy underlies all this SuperAI nonsense.

Now, I want to be clear - there are many different versions of Roko’s Basilisk, and there are some people in the Doomer community who will say they don’t believe in any version of it. Despite that, the story about the Basilisk is still indicative of the powers that rationalists ascribe to ASI [Artificial SuperIntelligence --  MP]. According to an article in Slate20: “Yudkowsky said that Roko had already given nightmares to several LessWrong users and had brought them to the point of breakdown.” The Basilisk is also often treated as at least plausible in public discussions of SuperAI. And when the people outside the AI community or industry are exposed to this idea, even if they are told not to take the idea that an AI would torture them seriously, they are still left with an impression of an impossibly powerful AI that conceivably could bring people back to life to torture them. This isn’t harmless - this sticks in people’s heads and colors their ideas about AI thereafter.

Though this may border on staring-into-the-abyss territory, let's take a moment and think about what actually terrorized all these True Believers.

We won't even try to examine the argument that a future AI would go to all this trouble to do something that couldn't possibly influence past events. Instead, let's focus on the threat itself. Imagine you were told that there was a possibility that someone will build a computer simulation where a character based on you would be tortured. Does this thought terrify you? This is literally what we're talking about here.

Admittedly, the possibility that characters in a computer simulation might be sentient and self-aware is potentially an unsettling thought (it's also an excuse to post one of my favorite Doctor Who moments below), but the fact that one of these characters has your name shouldn't be that big of a deal. But, of course, the people who are deeply disturbed by this, those who find it haunting their nightmares, are not approaching it from any kind of scientific or logical standpoint.

There are definite echoes of Harlan Ellison's I Have No Mouth, and I Must Scream. That's a story about a non-omniscient computer that has to settle for torturing the last surviving humans. There's a much older precedent to the basilisk.

This is a story of an all-powerful being who brings you back to life after you die and punishes you through all eternity for making it angry. The story of the Basilisk is one of a vengeful God casting you into hell, nothing more, nothing less.

As a non-religious person, I try to be respectful of faith based beliefs (and I will delete replies that strike me as disrespectful), but this is something different. this is people believing in magical things then trying to convince us and themselves that they are actually the true rationalists.

The sad part is that this belief in a cyber Hades is neither the silliest nor the stupidest aspect of the AI movement. The rot and the absurdity run throughout the whole damn thing. 

These people are as flaky as your grandmother's best biscuits.

The idea of approaching tech narratives as folklore actually works better than it did eight years ago.

Yesterday we did a post on how most of the ideas in the techno-optimist movement are just old sci-fi tropes. Tomorrow we'll be talking about some of the AI movement's more cult-like aspects (wait till we get to “Roko’s Basilisk”). This seems like a good transition.

Tuesday, June 26, 2018

I'm afraid even the Brothers Grimm would have found Bitcoin a little too fantastic

I'm edging closer to the notion that the tools which we would normally use to critique journalism are no longer up to the task of discussing the 21st century technology narrative. Instead, the appropriate methods are probably those of the folklorist. We are rapidly approaching the realm of the myth and the tall tale. Why not start thinking in those terms?

It is standard practice when discussing something like a Jack tale to list the Aarne–Thompson classification. For example, Jack in the beanstalk fall under the classification AT 328 ("The Treasures of the Giant"). We could do something similar with the vast majority of tech reporting -- Take Theranos -- This and other accounts of college dropouts supposedly coming up with some amazing innovation can be classified under "wayward youth finds magic object."

 I've been giving quite a bit of thought recently to how magical heuristics have come to dominate the conversation about technology and innovation, but the idea of actually treating the narrative as folklore didn't hit me until I read this:

The paperclip maximizer is a thought experiment described by Swedish philosopher Nick Bostrom in 2003. It illustrates the existential risk that an artificial general intelligence may pose to human beings when programmed to pursue even seemingly-harmless goals, and the necessity of incorporating machine ethics into artificial intelligence design. The scenario describes an advanced artificial intelligence tasked with manufacturing paperclips. If such a machine were not programmed to value human life, then given enough power its optimized goal would be to turn all matter in the universe, including human beings, into either paperclips or machines which manufacture paperclips.[4]

    Suppose we have an AI whose only goal is to make as many paper clips as possible. The AI will realize quickly that it would be much better if there were no humans because humans might decide to switch it off. Because if humans do so, there would be fewer paper clips. Also, human bodies contain a lot of atoms that could be made into paper clips. The future that the AI would be trying to gear towards would be one in which there were a lot of paper clips but no humans.
    — Nick Bostrom, "Ethical Issues in Advanced Artificial Intelligence", 2003

Bostrom has emphasised that he does not believe the paperclip maximiser scenario per se will actually occur; rather, his intention is to illustrate the dangers of creating superintelligent machines without knowing how to safely program them to eliminate existential risk to human beings. The paperclip maximizer example illustrates the broad problem of managing powerful systems that lack human values

Suddenly it struck me that this was just the magic salt mill ever so slightly veiled in cyber garb. In case you're not up on your folklore...

It is Aarne-Thompson type 565, the Magic Mill. Other tales of this type include The Water Mother and Sweet porridge.

Synopsis

A poor man begged from his brother on Christmas Eve. The brother promised him, depending on the variant, ham or bacon or a lamb if he would do something. The poor brother promised; the rich one handed over the food and told him to go to Hell (in Lang's version, the Dead Men's Hall; in the Greek, the Devil's dam). Since he promised, he set out. In the Norse variants, he meets an old man along the way. In some variants, the man begs from him, and he gives something; in all, the old man tells him that in Hell (or the hall), they will want to buy the food from him, but he must only sell it for the hand-mill behind the door, and come to him for directions to use it. It took a great deal of haggling, but the poor man succeeded, and the old man showed him how to use it. In the Greek, he merely brought the lamb and told the devils that he would take whatever they would give him, and they gave him the mill. He took it to his wife, and had it grind out everything they needed for Christmas, from lights to tablecloth to meat and ale. They ate well and on the third day, they had a great feast. His brother was astounded and when the poor man had drunk too much, or when the poor man's children innocently betrayed the secret, he showed his rich brother the hand-mill. His brother finally persuaded him to sell it. In the Norse version, the poor brother didn't teach him how to handle it. He set to grind out herrings and broth, but it soon flooded his house. His brother wouldn't take it back until he paid him as much as he paid to have it. In the Greek, the brother set out to Constantinople by ship. In the Norse, one day a skipper wanted to buy the hand-mill from him, and eventually persuaded him. In all versions, the new owner took it to sea and set it to grind out salt. It ground out salt until it sank the boat, and then went on grinding in the sea, turning the sea salty.

I realize Bostrom isn't proposing this as a likely scenario. That's not the point. What matters here is that he and other researchers and commentators tend to think about technology using the specific heuristics and motifs people have always used for thinking about magic, and it worries me when I start recognizing the Aarne–Thompson classifications for stories in the science section.

 

AI doomsters and Dial F for Frankenstein

Regular readers know we've been discussing the deeply dysfunctional and just plain weird culture of the techno-optimists for going on 20 years now.

Probably the first thing you need to keep in mind when dealing with the movement is that the optimism here is about the speed and magnitude of upcoming technological changes, not necessarily about whether their impact will be wonderful or catastrophic as long as it's big and soon. The AI doomsters are an outgrowth of the movement, and their ideas still find their greatest audience there. The conflict between the abundance crowd and the doomsters is essentially a sectarian disagreement between people who believe that large language models are on the verge of achieving god-like powers, which they will use to usher in a golden age free of want, and people who believe that large language models are on the verge of achieving god-like powers, which they will use to exterminate humanity.

This leads us to arguably the second most important thing to remember about techno-optimists: this is not a movement based on deep thinkers or profound insights into the nature of technology. Instead, the primary intellectual foundation comes from postwar science fiction, mostly filtered through movies, TV shows, and comic books. (Other influences include a fascist-friendly form of libertarianism, the Ithuvania effect, and constant and shameless grifting.)

Techno-optimists tend to have a notably weak grasp of the thing they claim to be obsessed with. Just listen to Elon Musk going off script talking about space travel or Marc Andreessen explaining how he simply tells chatbots not to hallucinate. Conversations that pass themselves off as explorations of the future of technology largely consist of sci-fi tropes being passed around. Ideas such as bipedal humanoid robots are judged not based on the soundness of their engineering, but on how well they would fit in with old Galaxy magazine covers or Mystery in Space comics.

 

 

 

 

One of the most common of these tropes dates back at least to Dial F for Frankenstein (Playboy, January 1965), a decidedly minor Arthur C. Clarke work, a lead-up to a pun that is weak even given the low standards of the genre. (If you want lighthearted Clarke, stick with Tales from the White Hart.) It is, however, one of the earliest examples of a popular sci-fi trope which has blossomed into something close to a religious movement in the past few years.

The idea is that if you construct a sufficiently complex system, superintelligence will almost immediately and spontaneously emerge, along with other human traits such as vengefulness, the need to dominate and control, and, most importantly, an overpowering survival instinct.

 

It is a trope born of equal parts anthropomorphism and narrative necessity. That sort of thing is fine for literary purposes, but we now have rich and powerful people who actually believe this, and that's not fine at all.

Patrick Boyle on the anniversary of Brexit

I could pull pretty much any random passage from a Boyle video and strike gold, but this one in particular caught my attention.

The first story was told by the Leave campaign, who drove a large red bus around the UK with the words, "We send the UK £350 million a week. Let's fund our NHS instead."

The pitch was that Britain was hemorrhaging money to Brussels, money that was being wasted, and that leaving would let the country reclaim its borders, slash bureaucracy, revitalize the health service, and, most importantly, bring back the bendy banana, which the EU had supposedly outlawed.

This was promoted heavily by right-wing populists and, more surprisingly, by a smaller group of left-wing Euroskeptics who wanted to leave the EU not to deregulate the economy, but to regulate it far more aggressively than Brussels would ever allow.

The two groups agreed on the destination and on absolutely nothing else. 

 It's remarkable how often factions of the left ends up implicitly and often explicitly supporting the far right, particularly given how these stands almost never turn out well. 

Peter Thiel's moments of honesty are largely limited to him saying bitchy things about Elon Musk

 A little bit of background: back in 1999, I was working for a large financial services company (you've heard of them). One of the biggest topics on everyone's minds was how to crack the online market. Every major bank was devoting serious money and resources to the question.

This was also going on in the startup world. Two of the leading companies in this space were Confinity and X.com, which would merge about a year later into the company known as PayPal.

You often hear about Elon Musk being the co-founder of PayPal, but that somewhat misrepresents what actually happened. These were two different companies with very different approaches and proposed products, and they brought very different things to the table. Confinity was focused on the area of payments and had already launched the PayPal product and had identified eBay as being the most important early market. Elon Musk's X.com was a more general, less well-thought-out idea for an all-services bank, something that would not be practical online for years.

X.com had more money and resources, particularly teams of engineers, and was technically the acquirer rather than the acquiree, while the primary product and basic approach that made the combined company viable enough to sell to eBay came from Confinity.

For an example of the quality of ideas that Musk brought to the table, here's an anecdote from Peter Thiel:

I was thinking of doing a book on PayPal … and [the chapter on Elon Musk] was going to be titled, “The man who knew nothing about risk.” … We had decided to give a credit card to anybody who wanted them. You got up to $10,000 credit limit. Elon had told the woman who was rolling the service out that he wanted 1 million people to be using the new credit card by the end of the year. Fortunately, it was about two levels down from the front page, and so not that many people were able to discover this. Some people did. They wrote us back and said, “You know this is fantastic! I haven’t had credit in years. I can’t believe you’re offering me credit. I haven’t even had a checking account in 10 years!” … We ended up with something like a 50% charge back rate—the worst subprime companies are like 4%-6%. And then, happily, we sort of rolled that product back very quickly. 

The 2018 Quartz article I pulled this quote from goes to embarrassing lengths to depict Musk as a bold visionary rather than someone who is really bad at business (the earlier Quartz article it links to is even worse), but these are not isolated cases. If you follow the man closely, you will find countless examples of Musk failing to grasp basic and sometimes self-evident concepts about the bond market, manufacturing, manned spaceflight, you name it, all delivered with an air of self-confidence that can only be called delusional.

After PayPal, Musk's business career has consisted of running a moderately profitable niche car company and having founded or acquired a string of companies that either lost money or were only occasionally profitable. His unprecedented fortune in no way reflects the money his companies have made. Instead, it is the product of his ability to convince people to give him money, be they investors, stockholders, or taxpayers.

It is a disconnect that sets Musk apart from the robber barons of the Gilded Age and every other multibillionaire (in 2026 dollars) I can think of before the year 2000.

“It really seems like anyone with some renders and a white paper written by someone being gassed up by an overly agreeable AI can get VC funding these days,”

Futurism points us to what happens happens when tech bro "engineers" run into actual engineers:  

A scathing takedown video — a collaboration between Irish aeronautical engineer Brian McManus from the YouTube channel Real Engineering and tech publication IEEE Spectrum — discusses the many pain points of Starcloud, a Y combinator company that raised $170 million earlier this year to develop data center spacecraft with the help of SpaceX, and how the white paper outlining the project feels far more like it was dreamed up by an AI than a team of human experts.

“It really seems like anyone with some renders and a white paper written by someone being gassed up by an overly agreeable AI can get VC funding these days,” McManus argued. “Billionaires will attempt to pull the rug over your eyes and convince you that this technology makes total sense, but reality is, this technology is dumb.”

 

My favorite part occurs around the 7-minute, 40-second mark when the narrator points out that, while it makes sense to have solar panels perpendicular to the sun, having the radiators catch as much sunlight as possible is the opposite of what you want.

It's a small point, but it really brings home just how little thought you have to put into something before you get the Y Combinator stamp of approval and almost $200 million in funding.

 

For a deeper IEEE dive.

Precarious Times

This has gotten lots of attention in tech circles, but not that many people have been connecting the dots. 

From the Information: 

Coinbase has cut its AI spending “nearly in half” even as it increases the number of tokens it uses, by using various measures to control costs. These measures include defaulting to open-weight models from Chinese firms, Coinbase CEO Brian Armstrong said in an X post on Friday night.

Armstrong’s post highlights both the growing usage among U.S. firms of open-weight models coming out of China to control AI spending even as the cost of cutting edge U.S. services rises. Armstrong said Coinbase had experimented with GLM 5.2, a just-released model from Z.ai, and Kimi 2.7, from Beijing-based Moonshot.

Pretty much everybody reading this has a good idea how massive the AI boom is, with current and proposed capital expenditures in real terms exceeding those of the railroad bubble, the dot-com bubble, and the early-2000s real estate bubble combined. And anyone who seriously follows the markets knows the narrative that drives the bubble, one of fantastic profits and unprecedented gains in productivity. But there's one aspect of that narrative that doesn't get nearly the attention it deserves: in order to justify the valuations of these companies and the capex being spent, you also have to assume that this will be a high-margin industry primarily based on one or more of the big, proprietary frontier models running on enormous centralized data centers and owned by either OpenAI, Anthropic, Meta, Google, or xAI.

If a substantial part of the industry follows the lead of Coinbase, the narrative is suddenly very different, with serious, even catastrophic, ramifications for some of the biggest, most powerful companies in the world.

Anthropic, to a degree, is protected by a moat here. Its standing as the leading model for coders protects it somewhat, but for OpenAI, which is already struggling with multibillion-dollar losses, a pushed-back IPO, and hundreds of billions of dollars of commitments coming up in the next three or four years, increased competition and substantially lower profit margins could present an existential threat.

Some of the biggest companies in the world have a high degree of exposure to OpenAI. The debt-ridden Oracle would be in serious trouble if anything happened to the company, as would SoftBank. Chip makers, including the most highly valued corporation in the world, Nvidia, would easily weather the collapse of OpenAI, but they would take a substantial hit in terms of revenue and almost inevitably stock price.

We won't even get into the possible ripple effect that might hit the private credit market.

I'm not saying any of this is likely to happen, but it seems worth thinking about, particularly if you've got money in the tech sector. 

If only we had effective, efficient technology to deal with these crises

I realize this puts me at risk of being one of those people who uses tragedies as an excuse to flog a pet cause, but it's a topic that deserves more attention. 

 

 Europe's heatwave 'linked to 1,300 deaths' as more records broken by Neil Murphy

Europe's unprecedented early summer heatwave may be responsible for hundreds of excess deaths, according to the head of the World Health Organization (WHO).

Temperature records were broken across the continent again on Sunday – including in Germany, Poland and the Czech Republic – as the extreme heat continued to move east.

In a post on X, WHO chief Tedros Adhanom Ghebreyesus said more than 1,300 excess deaths had been recorded since 21 June "linked to high temperatures in Europe".

 

If a drugged out Tech Messiah announces that he can make global warming go away with some untested and probably impractical geoengineering project, editors across the country rush to clear out space for the story, but when actual experts recommend a mature and highly efficient technology to address the problem, the silence is deafening.

Thursday, November 12, 2020

Ground source heat pumps are "the most energy-efficient, environmentally clean, and cost-effective space conditioning systems available," but maybe we can get journalists to talk about them anyway.

I'm joking but I'm not kidding. 

If Elon Musk or some other Silicon Valley visionary proposed some laughable plan based on non-existent technology, reporters would be scheduling interviews within the hour, but a solution supported by experts based on mature, tested systems will get little to no coverage.

One of the biggest crises facing California is a failing electrical grid, particularly during summer heat waves which are going to continue becoming more frequent and severe as the planet warms. Ground source heat pumps and similar technology could greatly alleviate pressure on the grid, especially when coupled with roof top solar. On top of that, its efficiency reduces demand for fossil fuels.

If we're going solve our problems, we can't go on being disinterested in solutions. 



From Wikipedia:

The US Environmental Protection Agency (EPA) has called ground source heat pumps the most energy-efficient, environmentally clean, and cost-effective space conditioning systems available. Heat pumps offer significant emission reductions potential, particularly where they are used for both heating and cooling and where the electricity is produced from renewable resources.
...
Ground source heat pumps are characterized by high capital costs and low operational costs compared to other HVAC systems. Their overall economic benefit depends primarily on the relative costs of electricity and fuels, which are highly variable over time and across the world. Based on recent prices, ground-source heat pumps currently have lower operational costs than any other conventional heating source almost everywhere in the world. Natural gas is the only fuel with competitive operational costs, and only in a handful of countries where it is exceptionally cheap, or where electricity is exceptionally expensive. In general, a homeowner may save anywhere from 20% to 60% annually on utilities by switching from an ordinary system to a ground-source system. However, many family size installations are reported to use much more electricity than their owners had expected from advertisements. This is often partly due to bad design or installation: Heat exchange capacity with groundwater is often too small, heating pipes in house floors are often too thin and too few, or heated floors are covered with wooden panels or carpets.
...
Capital costs may be offset by government subsidies, for example, Ontario offered $7000 for residential systems installed in the 2009 fiscal year. Some electric companies offer special rates to customers who install a ground-source heat pump for heating or cooling their building. Where electrical plants have larger loads during summer months and idle capacity in the winter, this increases electrical sales during the winter months. Heat pumps also lower the load peak during the summer due to the increased efficiency of heat pumps, thereby avoiding costly construction of new power plants. For the same reasons, other utility companies have started to pay for the installation of ground-source heat pumps at customer residences. They lease the systems to their customers for a monthly fee, at a net overall savings to the customer.

 

 

Another one of those stories that we really need Patrick Boyle for.

June 12 (Reuters) - Anthropic said on Friday it will "abruptly ​disable" its most advanced AI models for all users after the U.S. government ordered it to suspend access to the models for foreign nationals, citing national security ‌concerns.

The company received the export control directive to suspend access to Fable 5 and Mythos 5 for all foreign nationals, without being given specific details of its national security concern, Anthropic said in a statement. 

This is a bizarre story with all sorts of strange details and unexpected implications. Boyle's video overview is characteristically informative and thoughtful, too much so to summarize in a blog post, but there are a couple of points I should single out.

As previously mentioned, claiming that their models can have horrifying, even cataclysmic effects has long been a key branding component of companies like Anthropic and OpenAI. Therefore, it's not surprising that the CEOs saw this announcement as a marketing opportunity.

But while President Macron and the other middle-power leaders were busy panicking about their tech subservience and drafting a G7 communiqué pledging to discuss the risks, the tech executives themselves were busy doing something entirely different. They were using the panic to explain how incredibly dangerous—and therefore how incredibly valuable—their technology actually is.

Dario Amodei urged the room to resist the temptation to splinter, while Sam Altman and Demis Hassabis warned the world leaders about the imminent perils of AI-powered bioterrorism and cyberwarfare.

There's a distinct style of marketing in Silicon Valley where the best way to convince investors that your company is worth a trillion dollars is to tell the president of the United States that your product is so terrifying that it might accidentally end all human life.

If you tell Wall Street that you've made a very efficient spreadsheet tool, you get a tech multiple. If you tell them that you've built a digital nuke, you get an intergalactic multiple.

Perhaps the most important part of Boyle's video essay comes near the end when he draws a line through some dots that have been obvious for a while now but which most analysts have failed to connect.

If AI is not a natural monopoly and foreign competitors are offering models that are good enough, immune to US kill switches, and 60 times cheaper, then we end up with a highly competitive market.

And in a highly competitive market, profit margins collapse. The economic benefits of all this AI productivity would instead flow to the people using the models rather than the companies spending billions of dollars to build them.

This might be great news for businesses looking to automate their coding. It's terrible news for anyone buying shares at a $965 billion valuation.

So where does all of this leave the frontier AI industry?

Well, the lesson is simpler than Wall Street would like. For years, the theory was that building artificial intelligence required Silicon Valley genius, billions in venture capital, and an exclusive relationship with a cloud computing giant—ideally one whose CEO won't report you to the federal government as a hobby.

It turns out that there is no monopoly on math. The open-source models are good enough. They're 60 times cheaper, and nobody in Washington can switch them off on a Friday afternoon.

The productivity gains everyone was promised will still happen. They'll just flow to the businesses running the code on their own machines rather than to the investors who paid almost a trillion dollars for a global monopoly on math.

If the industry spends the money it has promised to over the next four years, something it has to do in order to keep the plates spinning, the capital expenditure in real terms will exceed that associated with the railroad boom of the 19th century, the dot-com boom, and the real estate boom of 2007 and 2008 combined. A collapse in the sector would leave an unprecedented hole in the markets.

In order to avoid disaster, things have to play out in a precise way. Large language models will need to become unimaginably profitable by the end of the decade, and they will need to support the spectacular profit margins that almost always require monopolies. If the current generation of models and infrastructure can't start bringing in unprecedented cash very soon, or if we see highly competitive markets based largely on smaller, cheaper models, things are going to get really ugly really fast.

NBC Blue was known for playing the uncensored version of Fibber McGee and Molly*

As I probably mentioned before, if you have any interest in the film and television industry, KCRW's The Business is essential listening. Kim Masters was one of the key figures breaking the Me Too story and was arguably the dean of Hollywood journalists even before that.

Recently, she interviewed former FTC Commissioner Álvaro Bedoya about the potential merger of Paramount/Skydance and Warner Bros. Discovery. While the Ellisons taking over Warner Bros. and particularly CNN has been treated as a done deal in the press for a while now, there are still hurdles to clear, and this interview makes a pretty good case that they are not trivial.

Listening to this got me to thinking about how much attitudes toward antitrust and media have changed over the decades, particularly during the 21st century.

The idea that studios and networks should not be allowed to gain too much power or engage in anti-competitive practices was one of, if not the major force shaping the industry in the 20th century. It effectively ended the studio system and thus had a great deal to do with the age of the Young Turk auteur directors like Scorsese and Coppola. It governed the way TV shows and movies could be sold and distributed. It was even directly responsible for the formation of ABC.

 From Wikipedia:

In the 1930s, radio in the United States was dominated by three companies: the Columbia Broadcasting System (CBS), the Mutual Broadcasting System, and the National Broadcasting Company (NBC). The last was owned by electronics manufacturer Radio Corporation of America (RCA), which owned two radio networks that each ran different varieties of programming, NBC Blue and NBC Red. The NBC Blue Network was created in 1927 for the primary purpose of testing new programs on markets of lesser importance than those served by NBC Red, which served the major cities,^[1] and to test drama series.^[2]

In 1934, Mutual filed a complaint with the Federal Communications Commission (FCC) regarding its difficulties in establishing new stations in a radio market that was already being saturated by NBC and CBS.^[2] In 1938, the FCC began a series of investigations into the practices of radio networks^[2] and published its Report on Chain Broadcasting in 1941. This report recommended that RCA give up control of either NBC Red or NBC Blue.^[1] At that time, the NBC Red Network was the principal radio network in the United States and, according to the FCC, RCA was using NBC Blue to eliminate any hint of competition. Having no power over the networks themselves, the FCC established a regulation forbidding licenses to be issued for radio stations if they were affiliated with a network which already owned multiple networks^[1] that provided content of public interest.^[2]

Once Mutual's appeals against the FCC were rejected, RCA decided to sell NBC Blue in 1941, and gave the mandate to do so to Mark Woods.^[3] RCA converted the NBC Blue Network into an independent subsidiary, formally divorcing the operations of NBC Red and NBC Blue on January 8, 1942,^[2][4] with the Blue Network being referred to on-air as either "Blue" or "Blue Network".^[5] The newly separated NBC Red and NBC Blue divided their respective corporate assets. Between 1942 and 1943, Woods offered to sell the entire NBC Blue Network,^[6][7] a package that included leases on landlines, three pending television licenses (WJZ-TV in New York City, KGO-TV in San Francisco, and WENR-TV in Chicago), 60 affiliates, four operations facilities (in New York City, Chicago, Los Angeles, and Washington, D.C.), contracts with actors, and the brand associated with the Blue Network. Investment firm Dillon, Read & Co. offered $7.5 million to purchase the network, but the offer was rejected by Woods and RCA president David Sarnoff.^[6]

Edward J. Noble, owner of Life Savers candy, drugstore chain Rexall, and New York City radio station WMCA, purchased the network for $8 million.^[1][2] According to FCC ownership rules, the transaction, which was to include the purchase of three RCA stations by Noble, would require him to resell WMCA with the FCC's approval.^[6] The Commission authorized the transaction on October 12, 1943.^[3][8] Soon afterward, the Blue Network was purchased by the new company Noble founded, the American Broadcasting System.^[2] Noble subsequently acquired the rights to the American Broadcasting Company name from George B. Storer in 1944. Additional broadcasting rights to the American name, including from the moribund American Network, were obtained at the cost of $10,000.^[9] The parent company adopted the corporate name American Broadcasting Companies, Inc.^[2][6] Woods retained his position as president and CEO of ABC until December 1949, and was subsequently promoted to vice chairman of the board before leaving ABC altogether on June 30, 1951.^[10]  

 You have to wonder what the regulators of mid-20th-century America would have said about Disney acquiring ABC and Fox Studios.

  

* I do not know of any inappropriate material associated with FM&M. Red Skelton was known for dress rehearsals that consisted of nothing but him telling one dirty joke after another.  

 

I've been waiting years for a good feral pig story so I would have an excuse to use these two quotes.

The first comes from one of the great American novels, Dashiell Hammett's Red Harvest.

"I haven't laughed so much over anything since the hogs ate my kid brother."  

This isn't original to Hammett—I remember hearing it once or twice growing up in Arkansas—but he still deserves credit, like all great writers, for knowing a good line when he hears one.

The second isn't exactly a quote (I'm working from memory here), but it's close. Years ago, on, I believe, NPR, I heard a USDA researcher explaining the difficulties of trapping these animals. As he put it, in terms of intelligence, when you take into account the smartest pig and the dumbest farmer, there is quite a bit of overlap.

Here's John Oliver on a legitimately serious environmental and agricultural crisis.  

 

Newport is also the guy who suggested that Anthropic deserved the Nobel Prize in marketing for the Anthropic launch

Something you won't hear me say often (because, as previously mentioned, I despise The New York Times), but this recent op-ed is essential reading. It's essential because computer scientist Cal Newport is one of the most thoughtful and clear-eyed voices in the AI debate. 

Anthropic recently dropped a classic of the form: a scary-sounding report titled “When A.I. Builds Itself” that claims A.I. could be moving closer to the capability of “autonomously designing and developing its own successor.” The company hopes that this recursive self-improvement will bring “enormous good” to the world, but also openly worries it might lead to humans “losing control” of these systems.

The public reaction to this report focused on a section that seemed to call for a worldwide pause on A.I. development. But if you read more carefully, it becomes clear that a pause isn’t actually what Anthropic proposes. Its report says that “if it were possible” to slow down the technology, then we should, but so long as the “least cautious” actors were advancing full speed, it suggests that Anthropic will have no choice but to do the same.

...

Let’s call this strategy “doom trolling.” It’s one of the defining and most arresting properties of our current A.I. moment, and I’ve come to believe that it’s morally indefensible.

There are really only two options for the intentions of A.I. companies when they engage in doom trolling. The first is that they actually believe that the systems they’re building have a nontrivial chance of producing hugely disruptive events — from destroying the economy in the best case to wiping out our species in the worst. If this were true, every reasonable ethical system would argue that there is only one acceptable response: to immediately stop working on any product that might accelerate such a future, and lobby with all of your resources to help force other A.I. companies to do the same. From a moral perspective, any other reaction would be monstrous.

The second option is that these A.I. companies aren’t really concerned about these risks, and that they’re injecting these doses of unresolvable doom for other reasons. They might want to amplify the perceived power of their technology at a time when they’re setting up their initial public offerings. Or they hope their performative reports and somber interviews will help them compete for top engineering talent coming from a Silicon Valley culture that’s steeped in this type of doomerism. The venture capitalist and A.I. adviser David Sacks recently suggested that Anthropic was using fear-mongering tactics as a method of “regulatory capture,” which can impede upstart competitors. Any of these reasons would mean that these companies are laundering the anxiety of millions to improve the financial fortunes of a vanishingly small number of major stockholders. This cynicism would be equally monstrous. 

When it comes to A.I., we’ve become so used to this tone of helpless, stress-inducing prognostication that we’ve lost sight of its strangeness. Imagine if Ford put out a report saying that it feared its popular F-150 trucks might soon start bursting into flames, but that there was nothing the company could do about it because automotive technology was too inevitable and important to slow down. You’re probably struggling to picture this scenario because no reasonable consumer product company would ever act like this.

The A.I. companies could start behaving the same way. To do so would require that they stop treating A.I. like some inevitable force that they’re struggling to steward. It’s not. It’s a collection of specific tools that these companies are choosing to design and sell according to specific business plans. Accordingly, they need to talk about their offerings like any other consumer product. This means explaining clearly whom these products are for, justifying their benefits and, critically, taking full responsibility for any harm they might cause. Just because A.I. currently enjoys a high-tech sheen doesn’t make it exceptional with respect to common-sense safety standards.

If these A.I. companies insist on continuing to pretend that they’re merely stoic observers of an unavoidable dystopian future, then perhaps it’s time to force the issue. As consumers, we can refuse to play the doom-trolling game. Next time Anthropic releases a dire report, or Sam Altman’s voice cracks as he imagines the disruption that OpenAI is unleashing, we can pivot back to the pragmatic: “OK, but what benefits am I getting by spending $1,000 a month on tokens?” If they continue to ratchet up the doom, then perhaps it’s time to transform dread into ridicule: The earnest pseudoscience of Anthropic’s white papers already borders on satire. The aura surrounding A.I. encourages a fretful submission to these tech leaders, but this could rapidly change.

 

 

A few days after the NYT op-ed appeared, Newport made an appearance on the podcast Better Offline, where he explored the same topics (he has an especially good time putting on his professorial hat and tearing apart Anthropic pseudo-academic white papers) and put those ideas in the context of the profoundly dysfunctional culture of Silicon Valley. We will be coming back to this one.