Raghuram G. Rajan: "The Indian Election and the Country’s Economic Future"

The former Reserve Bank of India head, now comfortably ensconced at the University of Chicago writing at Project Syndicate, May 24:

Having recently overtaken its former colonial master to become the world's fifth-largest economy, India's star certainly appears to be rising. But if the country remains committed to the current government's development strategy, the economy could lose its momentum well before achieving escape velocity.

CHICAGO – There is a buzz in India today – a sense of limitless possibilities. India has just overtaken its former colonial master (the United Kingdom) to become the world’s fifth-largest economy. If it maintains its current growth rate of 6-7% per year, it will soon overtake stagnant Japan and Germany to take over third place.

But by 2050, India’s workforce will start shrinking, owing to demographic aging. Growth will slow. That means India has only a narrow window in which to grow rich before it grows old: with per capita income of just $2,500, the economy must grow by 9% per year for the next quarter-century. That is an extremely difficult task, and the current election may well determine whether it remains possible at all.

The China Model 

In pursuit of rapid growth, the Indian government intends to follow a tested road map: the same path that Japan took in the immediate postwar decades, and that China took after the death of Mao Zedong. During the first stage of the journey, labor flows out of the traditional agriculture sector as employment increases in low-skilled manufacturing – typically stitching garments or assembling components into electronic goods. This output is then exported to the developed world to capture the benefits of producing at scale. 

 

Cheap labor helps compensate for a country’s other deficiencies, such as excessive bureaucracy, unreliable power (especially electricity), or poor roads. As firms profit from exports, they invest in equipment to make workers more productive; and as those workers are paid more, they can afford better schooling and health care for themselves and their children. Tax revenues also grow, providing the resources to upgrade the country’s infrastructure. The result is a virtuous cycle, because higher-skilled workers and better infrastructure enable firms to make more sophisticated, higher-value-added products. That is how China has moved from assembling components to producing world-leading electric vehicles in just four decades. Unfortunately, the same strategy is unlikely to work for India today.

Why China Surged Ahead 

It is no accident that India failed to join China in shifting its economy to export-oriented manufacturing, even though the two countries were similarly poor in the late 1970s, when China started on that road. Even low-skilled factory employment requires a minimum level of education and skills. At the time, many Chinese workers met this standard, whereas most Indian workers did not. So, foreign employers found China and its cheap but capable workers more attractive....

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I think the Professor is on good terms with the Prime Minister but you can see where Modi's muscle guys might take offense at straight talk.  

If interested we've visited him on everything from central banking to American farmland prices in the 1920's.

"Where Does China Stand in the AI Wave?"

From ChinaTalk, May 10:

China’s top policy experts discuss the US-China gap, open vs. closed, and societal implications 

This piece was authored by “Bit Wise,” an anonymous ChinaTalk contributor focusing on China’s AI policy.

Debates and discussions by Western public intellectuals on AI governance are closely followed in China. Whenever prominent figures like Sam Altman, Joshua Bengio, or Stuart Russell give interviews, multiple Chinese media outlets swiftly translate and analyze their remarks.

English-speaking audiences, however, seldom engage with the AI governance perspectives offered by Chinese public intellectuals.

In this article, ChinaTalk presents the highlights and a full translation of a panel discussion on AI (archived here) that took place six weeks ago in Beijing. Hosted by the non-profit organization “The Intellectual” 知识分子 — whose public WeChat account serves as a platform for discussions on scientific issues and their governance implications — the panelists delved into a wide range of topics, including:

• the state of China’s AI industry, discussing the biggest bottlenecks, potential advantages in AI applications, and the role of the government in supporting domestic AI development;

• the technical aspects of AI, such as whether Sora understands physics, the reliance on the Transformer architecture, and how far we are from true AGI;

• and the societal implications — which jobs will be replaced by AI first, whether open- or closed-source is better for AI safety, and if AI developers should dedicate more resources to AI safety.

The panelists are all real heavyweights
They all attended the Second International Dialogue on AI Safety in Beijing (also in March 2024), where they engaged with prominent Western AI scientists and drafted a Consensus Statement on Red Lines in Artificial Intelligence.

Xue Lan 薛澜 is China’s ultimate tech-policy guru. With a background in engineering and public policy, he frequently advises the government and serves as a Counselor of the State Council. Xue is the director of Tsinghua University’s Institute for AI International Governance, Dean of Schwarzman College, and one of seven members on the National New Generation AI Governance Expert Committee.

Zhang Hongjiang 张宏江 is a founding chairman of the Beijing Academy of AI (BAAI), one of China’s most advanced AI research institutes. Trained in multimedia computing, he joined HP Labs in Silicon Valley in 1995. Four years later, he returned to China and participated in the establishment of Microsoft’s China business, where he later became a Chief Technology Officer (CTO). In the early 2010s, he founded his own company. In 2017, he joined Source Code Capital, a Beijing-based VC firm founded by a former vice president of Sequoia Capital China, which has made notable investments in Bytedance, Meituan 美团, and Li Auto 理想, among others.

Li Hang 李航 is head of research at Bytedance, where he leads both basic research and product development across fields like search, recommendation, chat, and more. He has decades of experience in China’s AI industry, having previously worked at Microsoft Research Asia and Huawei’s Noah’s Ark Lab. He studied in Japan in the 1990s and worked at NEC Corporation.

And Zhou Zhonghe 周忠和, who moderated the discussion, is Editor-in-Chief at The Intellectual. An evolutionary biologist by training, he is an academician at the Chinese Academy of Sciences, China’s preeminent research institution — which also functions as a consultancy for science and technology policy. Since March 2023, Zhou has been a member of the Chinese People’s Political Consultative Conference.

Highlights

Open source
Whether frontier models should be open-sourced has become a major point of disagreement in AI safety debates globally. These debates will have direct legislative influence. For example, a draft expert proposal for China’s AI law published in March 2024 would exempt some open-source models from many legal requirements. (Note that this is not an “official” draft law yet — it’s just an informal expert proposal.)

Xue Lan: Open source should be encouraged. Large companies can find profit models at the commercial application and product layer, and compete on that layer. Judging from the practice in various research fields, this model — open source in the basic research stage, closed source in the productization stage — seems to be a very effective approach in promoting human progress. …

The discussion between open and closed source actually involves weighing the pros and cons. Some people may worry that open source will give extremist groups or individuals the opportunity to misuse the technology. Regardless of open source or closed source, as long as you intend to do evil, you will always find a way. Various technologies we have today may cause damage to human society if abused. Biotechnology is a good example: it also has the risk of misuse. Therefore, what is more important is how to establish a system to prevent and stop any individual or organization from abusing technology to harm society.

Li Hang: I strongly agree with a view expressed by Harry Shum at an AI conference last year: whether or not to open source depends on a company’s business strategy and position. … The best company will definitely not open source. The second-best will not open source if it wants to compete with the first place. The third and fourth might choose to open source to gain some competitive advantage. … Among AI companies, OpenAI and Anthropic are currently not open source. Meta and Amazon are open source.

Zhang Hongjiang: In both open and closed source, security and safety issues are always inevitable. But with open-source models, it’s easier for us to verify and review. In the future, any AI model released should pass safety certifications.

AI safety funding

Zhang Hongjiang: At a closed-door AI meeting, I once heard a point of view that really surprised me, but I believe that the data is correct: 95% of R&D expenses for nuclear powerplant equipment go into safety. This is a revelation for the AI field. Should we also invest more resources in AI safety? If 95% of nuclear-power R&D is invested in safety, shouldn’t AI also invest 10% or 15%, because this technology may also lead to human extinction?

The future of AI: large vs. small models....

....MUCH MORE

Work And The Encylopédie

From the blog of the Journal of the History of Ideas, March 25, 2024:

How Reason Encountered Work: The Encylopédie and the Métiers

The destruction of the communatés des métiers, the corporations which for centuries organized the work, life and exchange of trades in the kingdom of France, was undoubtedly a turning point in modern European history. Their dismantlement, which was first unsuccessfully attempted by Louis XVI’s minister Turgot in 1776, was a key element in the abolition of the feudal order during the French Revolution, and was later reinforced with the application of the Le Chapelier law in 1791, which fully banned any association or gathering in the workplace. The end of corporations seemingly enabled the emergence of an individualistic capitalist economy, the birth of modern civil society, but also foregrounded the transformation of the languages of labor that were at the origin of socialism. If its undertaking is intertwined with the revolutionary destruction of privilege, it nonetheless followed a singular trajectory related to the problem of how labor should be organized and governed. This piece explores some of the intellectual preconditions of this process.

Before the royal edicts or the national assembly resolutions that aimed at the political and legal destruction of guilds, labor had to be first comprehensively reimagined in theory. The reshaping of work as something different from its corporate experience (which structured the life of workers inside and outside the workshop through confraternity rites, master-apprentice relations, and social identities) was already enacted in the pages of Diderot and D’alembert’s Encyclopédie (1751-1772). In this major work of modern European thought, both an enlightened critique of corporations and a revalorization of the arts méchaniques, the crafts that turn nature into useful or beautiful things took place. If work has to be reimagined anew, it was also because pure manual labor and the mechanical arts—which were thought as a combination of manual effort and some degree of intellectual competence—were, vis-à-vis the liberal arts—considered the endeavor of pure mind and spirit—usually despised and deemed unbecoming of noble men. In what follows, we seek to understand how these two aspects of Diderot and D’Alembert’s projects are related and to what effects.

The full title of the Encyclopédie is a systematic [raisoné] dictionary of the sciences, arts, and crafts [métiers]. This foregrounds a novel centrality of work and production in an already atypical project that set out to reorder all available knowledge in purely alphabetical order. Its editors explicitly declared the celebration of the mechanical arts’ utility and the unprecedented meticulousness of their study and description as a guiding principle of their endeavor. Even further, the alphabetical classification itself implied a scandalous reordering of things which no longer respected the hierarchies of estate and status. The most diverse crafts thus occupied a place within the undifferentiated progression of the a-b-c, alongside topics which were traditionally considered to be noble or lofty.

Alongside the egalitarian order of the alphabet, however, a system of new hierarchies was also being established—as is not only evident in the depiction of the difference of literacy, but also the theoretical divisions of enlightened thought as shown in the Figurative system of human knowledge (1751) (see figure 1). In this “tree of knowledge,” trimmed and rearranged by the philosophes, work appears under the name of “uses of nature”; as the last sprout of the branch related to memory from which history also springs, and opposed to the branch of reason and philosophy. The latter overcomes the mere reminiscing of what has happened throughout time or the awareness of what is repeated in practice, and starts corresponding to the domain of law and all of the former’s underlying causes. Moreover, experiences—already singular and limited in themselves—are also bespoken in different dialects rather than in the universal language of science. The habits of remembering and the conventions of communicating about experiences vary greatly; they are always idiosyncratic, randomly accumulated through time, and consequently equivocal and confusing. True knowledge—full understanding of the causes and the possession of a language to express it—is thus, for these enlightened intellectuals, always external to the mere recollection of experience, to which the expertise of the métiers (trades) belongs. For the encyclopedists, the knowledge of the gens de métier, tradesmen that lived from the mechanical arts, had to be as poor as their spoken language because of their intrinsic distance from philosophical reason and the universal grammar that should be science’s only idiom....

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Big changes, little remembered.

"Small modular nuclear reactors get a reality check in new report"

The fact they've been available for over a decade and not enthusiastically deployed hither and yon tells us there's something not quite commercially viable about the little nukes.

From New Atlas, May 31:

A new report has assessed the feasibility of deploying small modular nuclear reactors to meet increasing energy demands around the world. The findings don't look so good for this particular form of energy production.

Small modular nuclear reactors (SMR) are generally defined as nuclear plants that have capacity that tops out at about 300 megawatts, enough to run about 30,000 US homes. According to the Institute for Energy Economics and Financial Analysis (IEEFA), which prepared the report, there are about 80 SMR concepts currently in various stages of development around the world.

While such reactors were once thought to be a solution to the complexity, security risks, and costs of large-scale reactors, the report asks if continuing to pursue these smaller nuclear power plants is a worthwhile endeavor in terms of meeting the demand for more and more energy around the globe.

The answer to this question is pretty much found in the report's title: "Small Modular Reactors: Still Too Expensive, Too Slow, and Too Risky."

If that's not clear enough though, the report's executive summary certainly gets to the heart of their findings.

"The rhetoric from small modular reactor (SMR) advocates is loud and persistent: This time will be different because the cost overruns and schedule delays that have plagued large reactor construction projects will not be repeated with the new designs," says the report. "But the few SMRs that have been built (or have been started) paint a different picture – one that looks startlingly similar to the past. Significant construction delays are still the norm and costs have continued to climb."

Too Expensive
The cost of SMRs is at the forefront of the report's argument against the deployment of the reactors. According to some of the data it provides, all three SMRs currently operating (plus one now being completed in Argentina) went way over budget, as this graph shows....

....MUCH MORE

Here's a post from 2010: "Hyperion to Build Demonstration Nuke the Size of two Hot Tubs for DOE Savannah River Site"

And a different company in November 2023: "Nukes: Small Modular Reactor Co., NuScale, Hit With Investor Lawsuit"

In between there were dozens of stories but not a lot of kilowatts. It took 'til 2022 for this "China Powers Up the World’s First Commercial Onshore Small Modular Nuclear Reactor":

Russia of course has the floating power plant anchored off Pevek 800km northwest of the Bering Strait, and in a pinch the nuclear icebreakers can supply a lot of juice. Additionally Kaz Minerals will be installing four modular nukes to power their giant Siberian copper mine, all links after the jump....

The Do-It-Yourself series had some ideas for our more energetic (so to speak) readers:

News You Can Use: "How to Build a Practical Household Bike Generator" 

Or, should one be more ambitious:

Say Goodbye To Big Tech Deplatforming/Cancellation/Censorship: Host Your Own Blog, Website, etc. 

News You Can Use: "'Collapse OS' Is an Open Source Operating System for the Post-Apocalypse"

Okay, Now That You Have Your Blog or Website Running On Your Own Undeplatformable Servers, It's Time To Consider Building Your Own Internet

Build Your Own Web 

Build Your Own Supercomputer (NVDA) 

Build Your Own Nuclear Power Plant 

 Surviving in Your Doomsday Bunker with Portable Nuclear Power to Spare

News You Can Use: "Aquatic refuges for surviving a global catastrophe"
Panic Rooms? Bunkers? New Zealand hidey-holes? Bond-villain island lairs?
Pish-posh.
What you want is a nuclear submarine....

News You Can Use: "How to Predict An Alien Invasion" (and how to rebuild the world from scratch)

"The City Makes the Civilization"

And in quite a few cities we are seeing retrograde motion.

From Palladium Magazine, May 31:

Social and political theorists have tied the emergence of cities to the origin of civilization since the earliest written records we have found. The perhaps four-thousand-year-old Epic of Gilgamesh, which shaped and inspired later literature, including the Bible, opens on what is best understood as an extended meditation on the nature of city life. In it, a wild man named Enkidu, who is created by the gods to humble King Gilgamesh, the ruler of the city, makes his way to the great city of Ur.

The observations in this story span the entire breadth of the phenomenon of society and are echoed by other Sumerian sources. Hunter-gatherer and pastoral people migrating to the city when hunting is sparse; the addiction—strange to them—that comes with drinking beer and eating bread; the role of temple prostitutes in recruiting people to the city, or even as agents of Gilgamesh sent to evaluate threats; the potential for tyranny that would be impossible outside the city; and how barbarians might make for better personal guards of the king of a city than those raised in the city, those with less personal martial skill yet with a vested interest in political infighting.

This close attention the epic pays to cities and the choices and situations therein is more than a prelude to the eventual friendship struck up by former nemeses Gilgamesh and Enkidu. Rather, it reveals itself to the careful readers as an inquiry—both an explanation and critique—of the city from the time when Sumerian civilization was still young. This focus on the effects of the great city of Ur on the wild man Enkidu is not surprising: of all social technologies, cities are, after all, perhaps the most important to a civilization.

Political thinkers thousands of years later, such as Plato and Aristotle went so far as to argue that the very minds of citizens of a Greek city-state—the polis—develop differently depending on the ordering of the city. The mere biology of Homo sapiens is, in this view, not the final word on what kind of being man is. Rather, that can only be discovered by examining the city and state individuals find themselves in, and that, in turn, actualizes and gives context to what they become. This thesis on what it means to be human is plausible since cities are the forges of human capital needed to maintain all other social technologies.

When industrial civilization was young in the 19th century, much of that era’s literature, as well as political and social theory, attempted to explain how Paris, London, or New York reforged peasants into factory workers and how it remade the foreign rural values in the great cities’ image. While cities have been demographic sinks both in the 21st century BC as well as the 21st century AD, requiring constant in-migration of wild men, pastoralists, and farmers to replenish their numbers, it is also cities that produce rapid social differentiation into different professions and classes needed by complex society—and always have.

Streets Give Coordinates to Society
Cities are the coordination landscape of society manifested into the physical world, allowing this landscape to be measured and studied. In all cultures, a physical address is something of a social rank, and a fairly fixed one at that, since it comes to determine who socializes and works with whom and in what ways. Where you live is always intimately tied to where you stand in society. Those who live near each other interact more frequently. Even in modern America, a society that expends much energy in obscuring a non-meritocratic class structure, one of the most mundane questions is also the most revealing and one you are obliged to answer in polite society: “Where do you live?” In a city like San Francisco or New York, the answer is suggestive for guessing income and net worth without fully revealing it, and it outright announces and defines one’s social milieu....

....MUCH MORE

We've looked at the metropolis from quite a few different angles:
"Cities Are Rising in Influence and Power on the Global Stage"

A subject near and dear to our jaded hearts.
It's the manifestation of the age-old thirst for power, to make the world as you want it, and an acknowledgement that fixing potholes is boring....

Very related over longer time frames:

"BAD LOCATIONS: Many French towns have been trapped in obsolete places for centuries"

From the Economic History Society's blog, The Long Run, July 17:

 
John Speed (1610), 17th century map of Beaumaris. Available on Wiki Commons. 

Only three of the 20 largest cities in Britain are located near the site of Roman towns, compared with 16 in France. That is one of the findings of research by Guy Michaels (London School of Economics) and Ferdinand Rauch (University of Oxford), which uses the contrasting experiences of British and French cities after the fall of the Roman Empire as a natural experiment to explore the impact of history on economic geography – and what leads cities to get stuck in undesirable locations, a big issue for modern urban planners.

Urban Warfare In A 'Smart City' Environment

"The Megacity Economy: How Seven Types of Global Cities Stack Up"

 

Most Populous Cities Through the Centuries (and diagrams of the principle high buildings of the world, 1884)

How Markets Shape Cities

One of the arguments against urban planning is that, since complexity itself introduces fragility into a system, attempting to overlay some human's conception of order rigidifies the system, reducing resilience and raising the chances of catastrophic failure. Sometimes chaos is good.

NVIDIA Wants to Run Your City: Smart City Control Centers (NVDA)

First off, let's make something crystal clear. From The Register, September 7, 2017:
Smart cities? Tell it like it is, they're surveillance cities

Apparently I get cranky when thinking about this stuff.

"Urbanisation might be the most profound change to human society in a century, more telling than colour, class or continent "

"The Spectrum of Control: A Social Theory of The Smart City"
One of the more important—and surprisingly popular—pieces we linked to in the past year..

Feral Cities

 

A Tale of Two Cities: Hamburg and Lubeck—Lessons in Trade, Geography and Urbanism

 

"Rulers of cities have always had an interest in visibility, both in representing their power and in controlling people by seeing them"

"The Unrest In Hong Kong And China's Bigger Urban Crisis"

"Henry George’s Land Value Tax: An Idea Whose Time Has Come?"

I realize that linking to two pieces on Mr. George in three days puts yours truly at risk of exemplifying Churchill's definition of a fanatic:

"A fanatic is one who can't change his mind and won't change the subject."

But here we are. And this one takes a slightly different approach to get where we are going.Plus some footnotes that would make even Matt Levine envious

Mad Scientist Blog: "Three Futurist Urban Scenarios"

The Real Real Estate State and Artificial Scarcity, Technology and Planning

"Tokyo proves that housing shortages are a political choice"

Of course it's a political choice.
You don't think homelessness in U.S. west coast cities, Los Angeles, San Francisco, Seattle etc. just happened do you. You don't think the fact Oregon has a black population of 1.9% versus 14.6% for the U.S. as a whole is just the natural order of things? It's all politics.

"Why you’ll be hearing a lot less about ‘smart cities’"

Today On Book Nook, the FT's Izabella Kaminska Reviews "Scale" (Why Cities Keep Growing, Corporations And People Always Die, And Life Gets Faster*)
Oh and she interviews the physicist/complexity-scientist author as well.

"The technological decoupling of geography from economic opportunity could make Gen Z filthy rich"

And thousands more. (okay, maybe hundreds)

Ahead Of The Official Start To The Hurricane Season: "National Hurricane Center tracking 4 tropical waves, including 2 in Caribbean"

Not looking for any development before next week if at all.

From the Palm Beach Post, May 30/31:

The National Hurricane Center is tracking four tropical waves, according to the latest tropical outlook.

With one more day remaining until the official start of the 2024 Atlantic hurricane season, no tropical development is expected over the next two days.

A fourth tropical wave popped up in the Hurricane Center's tropical discussion Wednesday afternoon.

AccuWeather is tracking an area in the Caribbean that has a low chance for tropical development, probably June 4-6. Even if the system develops, it's not expected to impact Florida or the U.S. as it moves into the Atlantic....

• Tropical wave 1: A tropical is located in the eastern Atlantic tropical wave extends off the coast of Africa from south of Cabo Verde to east of Cabo Verde. It is moving west at 17 mph.
• Tropical wave 2: A tropical wave in the Central Atlantic tropical wave stretches from northeast of Brazil to southwest of Cabo Verde. It's moving west at 17 to 23 mph.
• Tropical wave 3: A tropical wave has recently entered the far southeastern Caribbean Sea, west of St. Lucia. It is moving west at 17 mph.
• Tropical wave 4: A tropical wave in the western Caribbean tropical wave is located between Cancun, Mexico, and Cuba. It is moving west at 11 to 17 mph....

....MUCH MORE

"Tech giants form an industry group to help develop next-gen AI chip" (GOOG; MSFT; META....)

It's a fine line between cooperation and collusion.

From TechCrunch, May 30:

Intel, Google, Microsoft, Meta and other tech heavyweights are establishing a new industry group, the Ultra Accelerator Link (UALink) Promoter Group, to guide the development of the components that link together AI accelerator chips in data centers.

Announced Thursday, the UALink Promoter Group — which also counts AMD (but not Arm just yet), Hewlett Packard Enterprise, Broadcom and Cisco among its members — is proposing a new industry standard to connect the AI accelerator chips found within a growing number of servers. Broadly defined, AI accelerators are chips ranging from GPUs to custom-designed solutions to speed up the training, fine-tuning and running of AI models.

“The industry needs an open standard that can be moved forward very quickly, in an open [format] that allows multiple companies to add value to the overall ecosystem,” Forrest Norrod, AMD’s GM of data center solutions, told reporters in a briefing Wednesday. “The industry needs a standard that allows innovation to proceed at a rapid clip unfettered by any single company.”

Version one of the proposed standard, UALink 1.0, will connect up to 1,024 AI accelerators — GPUs only — across a single computing “pod.” (The group defines a pod as one or several racks in a server.) UALink 1.0, based on “open standards” including AMD’s Infinity Fabric, will allow for direct loads and stores between the memory attached to AI accelerators, and generally boost speed while lowering data transfer latency compared to existing interconnect specs, according to the UALink Promoter Group....

....MUCH MORE

Dell Technologies Stock Collapses, Nvidia Trades Higher (DELL; NVDA)

At the big GPU conference in March NVDA CEO made a point of acknowledging Michael Dell in the audience for Huang's keynote speech. It seems Dell is going to be a player in Nvidia's roll-out of server farms.

Dell's stock is down 17.75%( -$30.16) this morning 139.76 last.

From Barron's, May 31:

Nvidia Stock Gains. What Dell’s Earnings Mean for the Chip Maker.
Dell executives say there is strong demand for AI-powered servers, particularly those powered by Nvidia chips. 

Nvidia was rising Friday after the chip maker received another confirmation of its leading position in artificial-intelligence hardware in results from Dell Technologies.

Nvidia shares were up 1.7% at $1,123.55. The stock closed down 3.8% on Thursday as sentiment darkened around technology stocks. 

Shares might have been hit in the previous session by a report that Nvidia and other chip makers face a slowdown in getting licenses from U.S. officials for the export of large-scale AI accelerator shipments to the Middle East while a security review of the region is being carried out, according to Bloomberg, which cited people familiar with the matter. 

Nvidia declined to comment on the report. 

Further signs of Nvidia’s dominance in the AI chip market came from Dell Technologies , which reported earnings on Thursday and said there was strong demand for AI-powered servers, particularly those powered by Nvidia’s chips.

“When you look at the composition of our [AI server] backlog, it’s primarily Nvidia based … It’s continuing to build every quarter. Our five-quarter pipeline continues to grow,” said Jeffrey Clarke, Dell’s chief operating officer, in a call with analysts on Thursday....

....MORE

"Breakthrough by Shanghai doctors uses stem cells to cure diabetes"

As the kids say: "Big if true."

From China Daily, May 9:

Doctors in Shanghai have, for the first time in the world, cured a patient's diabetes through the transplantation of pancreatic cells derived from stem cells.

The 59-year-old man, who had Type 2 diabetes for 25 years, has been completely weaned off insulin for 33 months, Shanghai Changzheng Hospital announced on Tuesday.

A paper about the medical breakthrough, achieved after more than a decade of endeavor by a team of doctors at the hospital, was published on the website of the journal Cell Discovery on April 30.

It is the first reported instance in the world of a case of diabetes with severely impaired pancreatic islet function being cured via stem cell-derived autologous, regenerative islet transplantation, the hospital said. The most common pancreatic islet cells produce insulin.

Diabetes poses a serious threat to human health. Medical experts said that poor blood sugar control over a long period can lead to severe complications, including blindness, kidney failure, cardiovascular and cerebrovascular complications, and amputation. Life-threatening situations may also occur due to hypoglycemic coma, and ketoacidosis, which happens when the body begins breaking down fat too quickly.

China is the country with the largest diabetic patient population. There are 140 million diabetes patients in the country, of whom about 40 million depend on lifelong insulin injections, according to the International Diabetes Federation.

Experts said severe diabetes patients struggling with blood sugar control can only be effectively treated by minimally invasive transplantation, which injects islet tissue extracted from the pancreas of a donor.

However, due to factors such as a severe shortage of donors and the complexity of the islet isolation technology, it is hard for such transplantation to meet current clinical needs. That made how to regenerate human pancreatic islet tissue on a large scale in vitro a worldwide academic focus, the team in Shanghai said.

Yin Hao, a leading researcher on the team and director of the hospital's Organ Transplant Center, said they used the patient's own peripheral blood mononuclear cells and reprogrammed them into autologous induced pluripotent stem cells. They used technology they devised to transform them into "seed cells" and reconstituted pancreatic islet tissue in an artificial environment.

"Our technology has matured and it has pushed boundaries in the field of regenerative medicine for the treatment of diabetes," said Yin, whose team conducted the research with scientists from the Center for Excellence in Molecular Cell Science at the Chinese Academy of Sciences.

He said the patient, who was at serious risk of diabetes complications, had a kidney transplant in June 2017 but had lost most pancreatic islet function and relied on multiple insulin injections every day....

....MORE

Here's the paper.

And the introduction to August 2021's Big Money: "How the pandemic laid bare America’s diabetes crisis":

The pharma companies with the tens of billions of dollars they will earn from covid-19 vaccines are pikers compared to the hundreds of billions to trillions to be made in the diabetes business. As noted in 2017's
"CDC Report: 100 Million Americans Either Diabetic or On Their Way"

There's an opportunity in here, somewhere. The direct costs of healthcare for diabetics has to be five grand a year per. That gives us a half-trillion dollar market to address. Plus, who really wants a countryside full of blind amputees on dialysis?

The downside is if you are going to talk about it you almost immediately get into questions of race, poverty, food deserts, culture and on and on. Sometimes something as straightforward as the classic poor people's diet of cheap carbohydrates—that can have glycemic index numbers higher than table sugar—which leads to metabolic disorder, obesity and diabetes can be fraught with misunderstandings and political gamesmanship. 

In the U.S. some 40% of the population are obese. The CDC has the demographic breakdowns....

"Coronavirus pandemic spurs a chocolate and frozen pizza sales boom in America: Nestle USA CEO"
That's it, time to dust off the diabetes/retinopathy/dialysis/prosthetics portfolio....

Inflation: Personal Consumption Expenditures Deflator In Line

Meh.

From the Wall Street Journal's "Fed Whisperer" a couple interesting annualized rates:

The core PCE price index rose 0.25% in April (it rounded down to 0.2% because it was 0.249%)

Jan-March figures were revised down ever so slightly.

The 12-month change was 2.75%, a three-year low

The 6-month annualized rate was 3.18%, the highest since July pic.twitter.com/boKVU2IxLA

— Nick Timiraos (@NickTimiraos) May 31, 2024

Here's the Bureau of Economic Analysis' full release with tables (10 page PDF:  

Personal Income and Outlays, April 2024

Capital Markets: "Japan Confirms Intervention, China's PMI Disappoints, EMU CPI Firms, Ahead of US PCE Deflator"

And so much more!

From Marc to Market:

Overview: The dollar is mostly consolidating yesterday's losses ahead of month-end and the US income and consumption data. The PCE core deflator may have risen by 0.2%, the least this, year, but the year-over-year rate is expected to be steady at 2.8%. The dollar is recovering from a five-day low against the yen recorded yesterday near JPY156.40 and is near JPY157.30 in the late European morning turnover. The yen's retreat and a disappointing Chinese PMI have weighed on the yuan. The euro is bid after the firm year-over-year CPI reading. Sterling is little changed, in a narrow range above $1.2700. Emerging market currencies are mixed. The ANC looks to have lost its majority in South Africa and the rand is slightly lower today and is off around 2% this week. It is the weakest in the emerging market space, closely followed by the Mexican peso, which is off 1.9% this week. Mexico votes on Sunday.

Bond yields are mostly firmer. In Europe, benchmark 10-year yield are up 3-4 bp. That brings this week's increase to around 12-15 bp. The 10-year US Treasury yield is slightly firmer at 4.55%. This is about a nine-basis point increase on the week, but off the 4.63% high seen mid-week. Asia Pacific equities were mixed. Japan, South Korea, and Australia rose among the large markets. The index that tracks mainland shares in Hong Kong, fell 1.1% today to bring the week's loss to 3.2%. Europe's Stoxx 600 is slight changed buy firmer. It is off almost 0.8% this week, its second consecutive weekly losses. US index futures are lower, and the S&P 500 and NASDAQ are likely to snap a five-week advance barring a strong recovery today. Gold is little changed, hovering around $2342. It settled near $2324 last week. July WTI settled last week near $77.70. It traded between $77.50 and $80.60 this week, with the low seen earlier today. It is slightly below $78 now....

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"1-bit LLMs Could Solve AI’s Energy Demands"

From IEEE Spectrum, May 30:

“Imprecise” language models are smaller, speedier—and nearly as accurate 

Large language models, the AI systems that power chatbots like ChatGPT, are getting better and better—but they’re also getting bigger and bigger, demanding more energy and computational power. For LLMs that are cheap, fast, and environmentally friendly, they’ll need to shrink, ideally small enough to run directly on devices like cell phones. Researchers are finding ways to do just that by drastically rounding off the many high-precision numbers that store their memories to equal just 1 or -1.

LLMs, like all neural networks, are trained by altering the strengths of connections between their artificial neurons. These strengths are stored as mathematical parameters. Researchers have long compressed networks by reducing the precision of these parameters—a process called quantization—so that instead of taking up 16 bits each, they might take up 8 or 4. Now researchers are pushing the envelope to a single bit.

How to make a 1-bit LLM....

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Also at IEEE Spectrum, May 26: "Do We Dare Use Generative AI for Mental Health?"

And recently on reducing the electricity demands of artificial intelligence, May 21's "As The Amount Of Electricity Required By Data Centers Heads Toward Half Of Current Generating Capacity...." 

Inflation: Ahead Of Tomorrow's PCE Report

A reminder from May 10:

USDA World Agricultural Supply and Demand Estimates (WASDE): Food Inflation Down The Road

...These won't show up in the CPI or PCE deflator for months so in the meantime we should get a nice little inflation headfake lower from the housing component of the indices; setting up the next Presidential administration for a real mess in 2025 and 2026.

The Cleveland Fed Inflation Nowcast:

Inflation, month-over-month percent change

Month	CPI	Core CPI	PCE	Core PCE	Updated
May 2024	0.08	0.30	0.10	0.23	05/30
April 2024			0.27	0.23	05/30

And: 

Inflation, year-over-year percent change

Month	CPI	Core CPI	PCE	Core PCE	Updated
May 2024	3.36	3.55	2.67	2.67	05/30
April 2024			2.68	2.74	05/30

And from May 21:

Inflation: Fun With Math

 Jumping right into the gut of the argument, from TradingPlaces at StockCharts, May 19:

....Inflation Likely To Climb This Summer

There's like to be a few negative/bearish analyst comments this summer. The reason? In 2023, the June (+0.19%), July (+0.23%), and August (+0.23%) represented the 3 lowest monthly core CPI readings. That means that these monthly readings in the same 3 months as 2023 will need to come in extremely low or there'll be brief 3-month spike in the annual core rate of inflation at the consumer level. We know the stock market doesn't like uncertainty of any kind and a 3-month move higher in inflation could trigger that uncertainty.

Keep in mind that the June, July, and August readings are generally reported within the first 10 days to 2 weeks of the following month. So if we see weakness from these readings, it'll likely be from mid-July through mid-September....

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The Cleveland Fed Inflation Nowcast is looking for a .11% monthly headline figure to be reported next month as the housing component turns down. That would result in a 3.39% year-over-year rate.

Assuming the monthly figures in the post above are correct (I didn't check), even with the slowdown in the rate of ascent in housing costs we won't see headline CPI fall under 3% before the election. 

And then? Here's the outro from May 10's "USDA World Agricultural Supply and Demand Estimates (WASDE): Food Inflation Down The Road":

These won't show up in the CPI or PCE deflator for months so in the meantime we should get a nice little inflation headfake lower from the housing component of the indices; setting up the next Presidential administration for a real mess in 2025 and 2026.

 Not to put too fine a point on it but if I were Michelle Obama I'd tell Barack to put a sock in it for any idea of running for President before 2028.

See, if interested March 20's "Hotshot Wharton professor sees $34 trillion debt triggering 2025 meltdown as mortgage rates spike above 7%: ‘It could derail the next administration’":

This is the sort of stuff I was thinking about in the intro to March 6's "Michelle Obama's office says the former first lady 'will not be running for president' in 2024":

...On the other hand, I'm not sure you would want to be President during the next four years, there are so many problems that have been growing and metastasizing just beneath the surface of the daily news that the person in the hot seat could end up just plain reviled.

If I were a Democrat strategist I would propose letting Donald Trump win a second term while concentrating on House and especially Senate (to bottle up judicial, including Supreme Court, nominees) races.

A Trump win would give an excuse for riots (for the visuals) and if he is handcuffed by the Legislative branch to limit the range of possible responses, you go beyond polycrisis to the omnicrisis. Throw in a bit of Frances Fox Piven with her "overwhelm the system" and "motor voter" strategies and you could see one-party rule for thirty years....

May 28: Iowa Governor Announces Disaster Proclamation for Highly Pathogenic Avian Influenza in Sioux County

From the office of Iowa Governor Kim Reynolds, May 28:

Today Gov. Kim Reynolds announced the signing of a disaster proclamation for Sioux County, Iowa effective immediately through June 27, 2024. The USDA has confirmed a positive case of highly pathogenic avian influenza (HPAI) in commercial layer chickens. 

This proclamation allows state resources from Iowa Homeland Security, the Iowa Department of Agriculture and Land Stewardship, and other agencies to assist with tracking and monitoring, rapid detection, containment, disposal, and disinfection. The proclamation also waives regulatory provisions related to commercial vehicles responding to affected sites. 

The recent HPAI detections in birds do not present an immediate public health concern, and it remains safe to eat poultry products. If producers suspect signs of HPAI in their flocks, they should contact their veterinarian immediately. 

 

The disaster declaration relates to the culling of birds, not people. CBS, May 29:

More than 4 million chickens to be killed in Iowa after officials detect bird flu on farm

Stock in the country's largest egg purveyor, Cal-Maine Foods, is up about 1% on an otherwise down day. 

Ahead Of The Official Start To Hurricane Season President Biden Drains The Northeast's Gasoline Reserve

From Reuters, May 21:

US to close Northeast gasoline reserve with 1 million-barrel sale

President Joe Biden's administration will sell nearly 1 million barrels of gasoline in the U.S.-managed stockpile in northeastern states as required by law, the Department of Energy said on Tuesday, effectively closing the near decade-old reserve.

The department created the Northeast Gasoline Supply Reserve in 2014 after Superstorm Sandy left motorists scrambling for fuel. But storing refined fuel is costlier than storing crude oil, so closing the reserve was included in U.S funding legislation signed in March by Biden, a Democrat.

 

Bids are due on May 28 and the Treasury Department's general funds gets proceeds from the sale, the department said.

 

The volumes will be allocated in quantities of 100,000 barrels with each barrel containing 42 gallons, the department said. The gasoline should flow into local retailers ahead of the Fourth of July holiday, it said.

 

While the sale was mandated by bipartisan legislation, both the Biden administration and Republican presidential candidate Donald Trump tried to score points from it....

....MUCH MORE 

The sale idea was only taken up in March 2024 legislation, per the above link. Couldn't the powers that be have thought this through and figured out a way to delay the sales until the end of the official hurricane season, November 30?

Surely there could be some sort of executive order—I hear they are popular in D.C.—to hold off in the face of what is forecast to be one of the busiest hurricane seasons since the last La Niña:

• Hurricane Watch: CSU Forecasts Not Just More Hurricanes But More Landfalling Hurricanes This Season
• Hurricane Watch: One Of The More Accurate Models Is Looking A Bit Scary

Tesla Appointed Supplier To Giant RWE Battery Electric Storage System

From Power Technology, May 29:

RWE to build Australia’s first eight-hour BESS in New South Wales 
The project has secured a long-term energy service agreement and is set to commence construction in the second half of 2024.

German utility RWE has announced its investment decision to construct Australia’s inaugural eight-hour battery energy storage system (BESS) in New South Wales.

The project, adjacent to an existing solar farm near Balranald, will feature a capacity exceeding 50MW and 400 megawatt hours.

RWE’s 50MW Limondale BESS, a lithium-ion storage facility, emerged as the sole successful project in New South Wales’ initial long-duration storage long-term energy service agreements tender.

The project has secured a long-term energy service agreement and is set to commence construction in the second of 2024, with plans for commissioning by the end of 2025.

It will be located next to RWE’s 249MW Limondale solar farm, allowing for seamless integration with existing grid infrastructure.

The Limondale BESS is designed to bolster the energy transition by storing surplus renewable energy and supplying it to the New South Wales grid when demand peaks.

Tesla has been appointed as the supplier for the BESS, while local energy solutions provider Beon Energy Solutions will handle the balance of plant delivery.

This encompasses all necessary civil, structural, electrical and control works to connect the megapack to the current 33kV substation....

....MUCH MORE

There was another megapack story in January:

(Big) Batteries: "‘World leading' Tesla battery online to help kick coal out of Hawaii" (TSLA)

Capital Markets: "Dollar Pulled Back in Europe. New Buying Opportunity?"

We are seeing actions/reactions that don't fit into a mental matrix developed over many years at the market. Things like a weaker dollar in the face of higher U.S. rates/rate differentials, when both experience and theory would suggest the opposite. Commodity moves that don't appear to have much connection to supply/demand considerations. There are actually a half-dozen that come to mind and as we've said over the years it is in the interstices of these anomalies that you'll find opportunity. Just guess right as to what it all adds up to.

From Marc to Market:

Overview: The dollar initially extended yesterday's North American recovery but unwound most of the gains in the European morning. As North American dealers return, the greenback is lower against most of the G10 currencies. After approaching levels believed to have been where the BOJ last intervened, profit-taking pushed the dollar back to a marginal new low for the week (~JPY156.55). The yen's recovery arguably helped the Chinese yuan rise for the first time since May 15. The euro held important support near $1.0785 and sterling did the same near $1.2675. Still, the currencies' recovery in Europe stretched intraday momentum indicators. This suggests the risk favors selling into the upticks rather than piling on. Jitters over yesterday's South African election has weighed on the rand (~-1.2% today), and the thin Asia Pacific liquidity saw the Mexican peso extend yesterday's slide. Mexico goes to the polls Sunday, but market positioning more than election developments per se seem to be behind the peso's rout.

Asia Pacific equities followed Wall Street lower. Many of the large bourses, including the Nikkei, Hang Seng, Taiex, Kospi, and India, were off more than 1% today. After falling more than 1% yesterday, the biggest drop since mid-April, Europe's Stoxx 600 has come back bid today and it is up about 0.35%. However, US index futures are 0.4%-0.8% lower. Bonds are recovering from yesterday's sell-off. The 10-year JGB yield slipped a couple of basis points (to 1.05%), while European benchmark bonds are 2-3 bp lower (except Switzerland and Sweden, which reported stronger than expected Q1 GDP). The 10-year US Treasury yield is off a couple of basis points to 4.59%. Gold is extending its losses and reached $2322, a marginal new low since May 9. July WTI reached $80.60 yesterday, its best level since May 1. It settled near its lows and follow-through selling saw nearly $78.75 today. It is straddling the $79 area in the European morning....

....MUCH MORE

Reusing an outro from April 22:

....As cross-asset analyst John Normand wrote in his last - after twenty-four years - research note for JPMorgan:

How to time mostly efficient markets ("Tactical position-taking assumes one can time the market to outperform the benchmark, due to some combination of these factors: (1) markets are partially efficient; (2) some institutions have access to broader information sources than others; and (3) some analysts are better arrangers of a mosaic of even fully public information.")

Normand is now head of investment strategy at A$315 billion  AustralianSuper.

Watch Out Elon: China Unveils Neuralink Competitor

From the UAE's Emirates News Agency (WAM), May 28:

China unveils its Neuralink alternative, Neucyber

"China's version of Neuralink unveiled" - that is how observers described Neucyber, an invasive implanted brain-computer interface (BCI) technology, independently developed by Chinese scientists.

In its latest public appearance in April, through Neucyber, a monkey with its hands tied up can control a robotic arm with "just its thoughts" and successfully grasp a strawberry.

Recently, the Global Times visited the Chinese Institute for Brain Research in Beijing to witness the magical scene.

The wired Neucyber linking the monkey's brain is a system composed of three core components — high-throughput flexible microelectrodes, two high-speed neural signal acquisition devices and a generative neural decoding algorithm. It is able to capture subtle changes in the monkey's brain's electrical signals, decode the brain's intentions and achieve "thought" control of "actions".

The waving electrical signals on the screen are collected by the Neucyber, near the neurons of the monkey's brain, Zhang Lei, Director of Instrumentation Core from the institute told the Global Times, pointing to the robust signals.

The flexible electrode has been stably implanted in the monkey's skull for nearly a year and is still able to collect high-quality signals.

Following capturing signals, Neucyber will then decode the message with a decoding algorithm called "feedforward generative neural decoding algorithm," allowing the monkey to predict the moving target and control the robotic arm, Zhang said.

The advanced algorithm is a step forward to achieve the goal of creating neurally controlled prosthetics that are more human-like, natural and flexible for patients in the future. The team revealed that researchers are about to publish academic papers on the advanced algorithm-powered Neucyber....

....MUCH MORE

Recently:

"China's brain-computer interface technology is catching up to the US. But it envisions a very different use case: cognitive enhancement."

"Google’s generative AI fails 'will slowly erode our trust in Google'" (GOOG; EVIL)

Following on May 28's "Something Has Gone Very Wrong At Google (GOOG; EVIL)" we see this at Yahoo Finance, May 29:

It was a busy Memorial Day weekend for Google (GOOG, GOOGL) as the company raced to contain the fallout from a number of wild suggestions by the new AI Overview feature in its Search platform. In case you were sunning yourself on a beach or downing hotdogs and beer instead of scrolling through Instagram (META) and X, let me get you up to speed.

AI Overview is supposed to provide generative AI-based responses to search queries. Normally, it does that. But over the last week it’s also told users they can use nontoxic glue to keep cheese from sliding off their pizza, that they can eat one rock a day, and claimed Barack Obama was the first Muslim president.

Google responded by taking down the responses and saying it’s using the errors to improve its systems. But the incidents, coupled with Google’s disastrous Gemini image generator launch that allowed the app to generate historically inaccurate images, could seriously damage the search giant’s credibility.

“Google is supposed to be the premier source of information on the internet,” explained Chinmay Hegde, associate professor of computer science and engineering at NYU’s Tandon School of Engineering. “And if that product is watered down, it will slowly erode our trust in Google.”

Google’s AI flubs
Google’s AI Overview problems aren’t the first time the company has run into trouble since it began its generative AI drive. The company’s Bard chatbot, which Google rebranded as Gemini in February, famously showed an error in one of its responses in a promo video in February 2023, sending Google shares sliding.

Then there was its Gemini image generator software, which generated photos of diverse groups of people in inaccurate settings, including as German soldiers in 1943.

AI has a history of bias, and Google tried to overcome that by including a wider diversity of ethnicities when generating images of people. But the company overcorrected, and the software ended up rejecting some requests for images of people of specific backgrounds. Google responded by temporarily taking the software offline and apologizing for the episode.

The AI Overview issues, meanwhile, cropped up because Google said users were asking uncommon questions. In the rock-eating example, a Google spokesperson said it “seems a website about geology was syndicating articles from other sources on that topic onto their site, and that happened to include an article that originally appeared on the Onion. AI Overviews linked out to that source.”

Those are fine explanations, but the fact that Google continues to release products with flaws that it then needs to explain away is getting tiring.

“At some point, you have to stand by the product that you roll out,” said Derek Leben, associate teaching professor of business ethics at Carnegie Mellon University’s Tepper School of Business.

“You can't just say … 'We are going to incorporate AI into all of our well-established products, and also it's in constant beta mode, and any kinds of mistakes or problems that it makes we can't be held responsible for and even blamed for,' in terms of just trust in the products themselves.”....

....MUCH MORE

If interested a couple springtime posts addressed some of what's going on in Mountain View California. April 5, 2024:
"Why AI bias is a systemic rather than a technological problem"

Following up on March 31's "The Purpose Of A System Is What It Does...":

“....There is after all,” Beer observed, “no point in claiming that the purpose of a system is to do what it constantly fails to do.”

In late February when Google's Gemini generative AI generated some hubbub with the portraits of a black George Washington or a black Nazi, commenters missed the point of what the people at Google were doing. As Marc Andreessen—a guy who knows something about tech having developed the first commercial browser, among other things—put it regarding these so-called 'mistakes':

I know it’s hard to believe, but Big Tech AI generates the output it does because it is precisely executing the specific ideological, radical, biased agenda of its creators. The apparently bizarre output is 100% intended. It is working as designed.

— Marc Andreessen 🇺🇸 (@pmarca) February 26, 2024

Going back to that March 31 post, the penultimate bit before Voltaire took over:

Using this heuristic to look at systems like education or government helps focus on the fact that in a system, as opposed, possibly, to a one-off event, the result is the reality to focus upon. 

Reality is not the intentions of the systems designers and the systems implementers and reality is surely not the protestations or explanations, excuses or justifications that surround most human endeavors.

The end result of a system, is what the system is meant to do. For the rest it is hard to put it better than:...

And from The Conversation via Dublin's Silicon Republic March 29:

Dr Antje Scharenberg and Dr Philip Di Salvo from the University of St Gallen discuss the ‘automation of inequality’ that underpins AI innovation.

In public administrations across Europe, artificial intelligence (AI) and automated decision making (ADM) systems are already being used extensively.

These systems, often built on opaque ‘black box’ algorithms, recognise our faces in public, organise unemployment programmes and even forecast exam grades. Their task is to predict human behaviour and to make decisions, even in sensitive areas such as welfare, health and social services.

As seen in the US, where algorithmic policing has been readily adopted, these decisions are inherently influenced by underlying biases and errors. This can have disastrous consequences: in Michigan in June 2020 a black man was arrested, interrogated and detained overnight for a crime he did not commit. He had been mistakenly identified by an AI system.

These systems are trained on pre-existing human-made data, which is flawed by its very nature. This means they can perpetuate existing forms of discrimination and bias, leading to what Virginia Eubanks has called the “automation of inequality“.

Holding AI responsible
The widespread adoption of these systems begs an urgent question: what would it take to hold an algorithm to account for its decisions?

This was tested recently in Canada, when courts ordered an airline to pay compensation to a customer who had acted on bad advice given by their AI-powered chatbot. The airline tried to rebut the claim by stating that the chatbot was “responsible for its own actions”.

In Europe, there has been an institutional move to regulate the use of AI, in the form of the recently passed Artificial Intelligence Act.

This Act aims to regulate large and powerful AI systems, preventing them from posing systemic threats while also protecting citizens from their potential misuse. The Act’s launch has been accompanied by a wide range of preceding direct actions, initiatives and campaigns launched by civil society organisations across EU member states.

This growing resistance to problematic AI systems has gained momentum and visibility in recent years. It has also influenced regulators’ choices in crucial ways, putting pressure on them to introduce measures that safeguard fundamental rights.

The Human Error Project
As part of The Human Error Project, based at Universität St Gallen in Switzerland, we have studied the ways in which civil society actors are resisting the rise of automated discrimination in Europe. Our project focuses on AI errors, an umbrella term that encompasses bias, discrimination and un-accountability of algorithms and AI....

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Again, it is not the AI or algo, it is the creators, trainers, and promoters of these things that have to be held accountable.

The great embarrassment at Google was not that their ChatBot made historical mistakes but that the agenda behind the GOOGs public-facing offerings was exposed for all to see.

Modern War: "Anduril Is Building Out the Pentagon’s Dream of Deadly Drone Swarms"

We last looked at Anduril in April 29's "Autonomous Fighter Jet Company Anduril And Anti-Drone Technology For Your Home" when they were defending against drones. Here they are on the other side.

From Wired, May 28:

The US military aims to maintain its dominance by building autonomous attack drones that collaborate with humans and overwhelm defenses in swarms.

When Palmer Luckey cofounded the defense startup Anduril in 2017, three years after selling his virtual reality startup Oculus to Facebook, the idea of a twentysomething from the tech industry challenging the giant contractors that build fighter jets, tanks, and warships for the US military seemed somewhat far-fetched. Seven years on, Luckey is showing that Anduril can not only compete with those contractors—it can win.

Last month, Anduril was one of two companies, along with the established defense contractor General Atomics, chosen to prototype a new kind of autonomous fighter jet called the Collaborative Combat Aircraft, or CCA, for the US Air Force and Navy. Anduril was chosen ahead of a pack of what Beltway lingo dubs “defense primes”—Boeing, Lockheed Martin, and Northrop Grumman.

“Anduril is proving that with the right team and business model, a seven-year-old company can go toe-to-toe with players that have been around for 70+,” Luckey wrote on social media platform X shortly after the contract was announced. The company declined to make anyone available for this article.

That business model has seen Anduril focus on showing that it can rapidly deliver drones, submarines, and other hardware infused with advanced software at relatively low cost. It also reflects a shift in America’s war-fighting outlook toward quicker development of less expensive systems that feature more software and autonomy.

Investors seem to think it’s working. Anduril has raised a total of $2.3 billion in funding, according to Pitchbook which tracks startup investment and, according to The Information, is seeking $1.5 billion more.

Anduril’s prototype CCA aircraft, named Fury, is still at an early stage of development. Another test aircraft will be developed by General Atomics, a 68-year-old defense firm with a history of making remotely operated systems that include the MQ-9 Reaper, which played a key role in the US expansion of drone warfare in the 2000s.

The US Air Force wants the new CCA drones to be more capable and more independent than existing uncrewed craft, which still depend heavily on ground staff. They are envisioned performing a wide range of missions, including reconnaissance, air strikes, and electronic warfare—either alone or in collaboration with aircraft piloted by a human or autonomously. A core part of the program is developing new artificial intelligence software to control the aircraft that can operate autonomously in a wider range of situations than existing military systems, which are typically autonomous only in narrow circumstances.

“This is a big shift,” says Stacie Pettyjohn, a senior fellow at the Center for a New American Security , a Washington, DC, think tank. She says that the US military has so far mostly used AI for target recognition and planning rather than for controlling systems. The CCA project is “a huge step forward for uncrewed systems and for the Air Force and Navy,” she says.

The CCA project is the culmination of years of work inside the Pentagon developing a vision of more automated aerial warfare. In 2014, the Defense Advanced Research Projects Agency conducted a study called the Air Dominance Initiative and concluded that a combination of next-generation fighter jets and uncrewed systems or “loyal wingman” capable of working in teams would be the surest way to gain an advantage in future conflict. The ultimate goal is for several drones, similar to those in development by Anduril and General Atomic, to accompany a conventional, crewed aircraft on a mission and collaborate in flexible ways.

The underlying philosophy is that on the battlefield there is safety, and overwhelming power, in numbers. Giving US pilots a clutch of robot wingmen is supposed to make them deadlier and more likely to return from missions unharmed. And the project is intended to be just the start of a bigger shift toward deploying autonomous aircraft in much larger numbers.

“The CCA represents a move toward swarms or at least larger numbers of uncrewed systems,” Pettyjohn says. “As a tactic, swarming could potentially allow smaller cheaper drones to overcome more expensive systems. It could be a game-changing asymmetric capability.”....

....MUCH MORE

Related:

• "In U.S.-China AI contest, the race is on to deploy killer robots "

• "Oculus founder plans to double UK workforce for defence company Anduril"

• KillTech: "Shield AI expands massive Series F with another $300M in equity, debt, scaling valuation to $2.8B"

• "As Much As You Ever Wanted To Know About 155mm Artillery Shell Production and More"

And they're ESG to Boot!Dec. 2022 "Windfalls await investors in ammunition"
And with their inclusion in many ESG funds,* this is the best of all possible worlds....

• "Do venture capitalists want forever war?"