AI compute could become a regulated utility

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

1. 41:02

   of power i kind of agree with the notion that the ai data center hysteria and the hatred for the iran war are both rooted in this idea that you haven't solved my economic problems first so i don't think that they're the primary i think that they're a reflection of the consequence of not focusing on my issues first, my economic cost problem first. So I think that's still the biggest issue. I think two things are about to happen in 27. One is, I think it's going to be very hard with this Congress and the sitting president to come to a resolution on a clean budget. And as a result, I think things are going to continue as is. And I worry about the cost of things continuing to climb. And by the way, I'll just reflect on Shemov's point. COVID was an accelerating moment for this unaffordability problem for people that don't own assets in the

2. 41:57

   US. And the reason is we doubled government spending. That's what happened. And by doubling government spending, everything inflates, including assets, which is why people who are asset owners benefit, and people who are earners for their labor lose, because the cost of everything goes up. And if you're making money from a paycheck every week, you can't afford your health care, your education your housing bill your food your gas i do think that the iran war was acutely off target because it was declarative at the beginning we're not going to do any new wars and then there was a big war that was started so it was an easy target so i do think that this this budget question is a big one what's going to happen with spending in 27 28 and as we talked about a couple weeks ago i think the bond market will tell you where they think that's headed

3. 42:44

   because if we continue this $2 trillion a year deficit spending, things are going to remain expensive, they're going to get worse. And it's not about people choosing socialism as an ideology to counter Chemoff's comment earlier. I'm not saying people are choosing socialism as an ideology or as a set of principles. Socialist outcomes arise from the policies that people think are going to solve their cost issues. That's what ends up happening here. That people think the best way to solve the cost of things is to have the government do more. And then you have more socialist policies. It's not that people are saying, I want to be a socialist. And that's where you end up in this slippery slope spiraling problem. And I worry about how we're going to resolve to a budget going into 27 and 28. I do think AI is going to continue to be this really

4. 43:30

   big political hot point. I think the, um, like AI is almost like the ring of Sauron. Okay. And like both sides want the ring of sauron it's this ultimate kind of tool this ultimate power it is a risk to the state it is fundamentally something that takes power out of the government's hands and distributes it let's just assume that there isn't a company making ai and there isn't a company that owns all the data centers.

5. 44:00

   that there's a million data centers and a million variants of open source AI. In a world like that, there is no oligarchy that's making money off AI. So just assume that that's the case for a moment and that we can get to that end state. In that end state, the tools of AI pull a lot of power, a lot of influence away from government, from the state. And as that happens, I think the actors that want the state to be central, central command, central planning, central authority, and ultimately central power structure are going to react violently against that and they're going to want to have the ai so i actually think the calls to stop the development of ai are actually calls for them to have absolute control over ai because it is way too powerful for them to not have the control over the ai they want the ai and i think a lot of the policy stuff that we're going to end

6. 44:50

   up seeing here and this is where if you play the game theory out my i still think i could be wrong But I still think we end up in a place where the government says we want to regulate compute. They're not going to regulate the chips or the models because those are too hard to kind of catch up on. And you're never going to be able to regulate development of software. It's very hard to regulate deployment of software.

7. 45:12

   But the utilization of that software is fundamentally constrained by how much access you get to compute. I think the data centers end up being treated like utilities in the future. And I do think that the government are going to try and move down this path. they're going to realize it's the best path to get what i just described which is the ability to control and manage who gets access to this technology yeah and at a minimum they're going to get a great tax basis i think a lot of the data center stuff is performative they just want to get a better deal if you look at how gina from texas looked at data center she's looking at it from