big tech
It’s Time to Take On the New Cold Warriors of Silicon Valley
We can’t afford to let the people and companies that will profit most from AI’s unbridled military application have the upper hand in making the rules for how it should be used.
Venture capital and military startup firms in Silicon Valley have begun aggressively selling a version of automated warfare that will deeply incorporate artificial intelligence. Those companies and their CEOs are now pressing full speed ahead with that emerging technology, largely dismissing the risk of malfunctions that could lead to the future slaughter of civilians, not to speak of the possibility of dangerous scenarios of escalation between major military powers. The reasons for this headlong rush include a misplaced faith in “miracle weapons,” but above all else, this surge of support for emerging military technologies is driven by the ultimate rationale of the military-industrial complex: vast sums of money to be made.
The New Techno-Enthusiasts
While some in the military and the Pentagon are indeed concerned about the future risk of AI weaponry, the leadership of the Defense Department is on board fully. Its energetic commitment to emerging technology was first broadcast to the world in an August 2023 speech delivered by Deputy Secretary of Defense Kathleen Hicks to the National Defense Industrial Association, the largest arms industry trade group in the country. She used the occasion to announce what she termed “the Replicator Initiative,” an umbrella effort to help create “a new state of the art—just as America has before—leveraging attritable, autonomous systems in all domains—which are less expensive, put fewer people in the line of fire, and can be changed, updated, or improved with substantially shorter lead times.”
Hicks was anything but shy about pointing to the primary rationale for such a rush toward robotic warfare: outpacing and intimidating China. “We must,” she said, “ensure the PRC [People’s Republic of China] leadership wakes up every day, considers the risks of aggression, and concludes, ‘Today is not the day’—and not just today, but every day, between now and 2027, now and 2035, now and 2049, and beyond.”
Hick’s supreme confidence in the ability of the Pentagon and American arms makers to wage future techno-wars has been reinforced by a group of new-age militarists in Silicon Valley and beyond, spearheaded by corporate leaders like Peter Thiel of Palantir, Palmer Luckey of Anduril, and venture capitalists like Marc Andreessen of Andreessen Horowitz.
Patriots or Profiteers?
These corporate promoters of a new way of war also view themselves as a new breed of patriots, ready and able to successfully confront the military challenges of the future.
A case in point is “Rebooting the Arsenal of Democracy,” a lengthy manifesto on Anduril’s blog. It touts the superiority of Silicon Valley startups over old-school military-industrial behemoths like Lockheed Martin in supplying the technology needed to win the wars of the future:
The largest defense contractors are staffed with patriots who, nevertheless, do not have the software expertise or business model to build the technology we need… These companies built the tools that kept us safe in the past, but they are not the future of defense.
In contrast to the industrial-age approach it critiques, Luckey and his compatriots at Anduril seek an entirely new way of developing and selling weapons:
Software will change how war is waged. The battlefield of the future will teem with artificially intelligent, unmanned systems, which fight, gather reconnaissance data, and communicate at breathtaking speeds.
At first glance, Luckey seems a distinctly unlikely candidate to have risen so far in the ranks of arms industry executives. He made his initial fortune by creating the Oculus virtual reality device, a novelty item that users can strap to their heads to experience a variety of 3-D scenes (with the sensation that they’re embedded in them). His sartorial tastes run toward sandals and Hawaiian shirts, but he has now fully shifted into military work. In 2017, he founded Anduril, in part with support from Peter Thiel and his investment firm, Founders Fund. Anduril currently makes autonomous drones, automated command and control systems, and other devices meant to accelerate the speed at which military personnel can identify and destroy targets.
Thiel, a mentor to Palmer Luckey, offers an example of how the leaders of the new weapons startup firms differ from the titans of the Cold War era. As a start, he’s all in for Donald Trump. Once upon a time, the heads of major weapons makers like Lockheed Martin tried to keep good ties with both Democrats and Republicans, making substantial campaign contributions to both parties and their candidates and hiring lobbyists with connections on both sides of the aisle. The logic for doing so couldn’t have seemed clearer then. They wanted to cement a bipartisan consensus for spending ever more on the Pentagon, one of the few things most key members of both parties agreed upon. And they also wanted to have particularly good relations with whichever party controlled the White House and/or the Congress at any moment.
The Silicon Valley upstarts and their representatives are also much more vocal in their criticisms of China. They are the coldest (or do I mean hottest?) of the new cold warriors in Washington, employing harsher rhetoric than either the Pentagon or the big contractors. By contrast, the big contractors generally launder their critiques of China and support for wars around the world that have helped pad their bottom lines through think tanks, which they’ve funded to the tune of tens of millions of dollars annually.
The approach advocated by Brose and his acolytes is going to make war more likely as technological hubris instills a belief that the United States can indeed “beat” a rival nuclear-armed power like China in a conflict, if only we invest in a nimble new high-tech force.
Thiel’s main company, Palantir, has also been criticized for providing systems that have enabled harsh border crackdowns by U.S. Immigration and Customs Enforcement (ICE) as well as “predictive policing.” That (you won’t be surprised to learn) involves the collection of vast amounts of personal data without a warrant, relying on algorithms with built-in racial biases that lead to the systematic unfair targeting and treatment of people of color.
To fully grasp how the Silicon Valley militarists view next-generation warfare, you need to check out the work of Christian Brose, Palantir’s chief strategy officer. He was a long-time military reformer and former aide to the late Sen. John McCain (R-Ariz.). His book Kill Chainserves as a bible of sorts for advocates of automated warfare. Its key observation: that the winner in combat is the side that can most effectively shorten the “kill chain” (the time between when a target is identified and destroyed). His book assumes that the most likely adversary in the next tech war will indeed be China, and he proceeds to exaggerate Beijing’s military capabilities, while overstating its military ambitions and insisting that outpacing that country in developing emerging military technologies is the only path to future victory.
And mind you, Brose’s vision of shortening that kill chain poses immense risks. As the time to decide what actions to take diminishes, the temptation to take humans “out of the loop” will only grow, leaving life-and-death decisions to machines with no moral compass and vulnerable to catastrophic malfunctions of a sort inherent in any complex software system.
Much of Brose’s critique of the current military-industrial complex rings true. A few big firms are getting rich making ever more vulnerable huge weapons platforms like aircraft carriers and tanks, while the Pentagon spends billions on a vast, costly global basing network that could be replaced with a far smaller, more dispersed military footprint. Sadly, though, his alternative vision poses more problems than it solves.
First, there’s no guarantee that the software-driven systems promoted by Silicon Valley will work as advertised. After all, there’s a long history of “miracle weapons” that failed, from the electronic battlefield in Vietnam to President Ronald Reagan’s disastrous Star Wars missile shield. Even when the ability to find and destroy targets more quickly did indeed improve, wars like those in Iraq and Afghanistan, fought using those very technologies, were dismal failures.
A recent Wall Street Journalinvestigation suggests that the new generation of military tech is being oversold as well. The Journal found that small top-of-the-line new U.S. drones supplied to Ukraine for its defensive war against Russia have proved far too “glitchy and expensive,” so much so that, irony of ironies, the Ukrainians have opted to buy cheaper, more reliable Chinese drones instead.
Finally, the approach advocated by Brose and his acolytes is going to make war more likely as technological hubris instills a belief that the United States can indeed “beat” a rival nuclear-armed power like China in a conflict, if only we invest in a nimble new high-tech force.
The result, as my colleague Michael Brenes and I pointed out recently, is the untold billions of dollars of private money now pouring into firms seeking to expand the frontiers of techno-war. Estimates range from $6 billion to $33 billion annually and, according to TheNew York Times, $125 billion over the past four years. Whatever the numbers, the tech sector and its financial backers sense that there are massive amounts of money to be made in next-generation weaponry and aren’t about to let anyone stand in their way.
Meanwhile, an investigation by Eric Lipton of TheNew York Times found that venture capitalists and startup firms already pushing the pace on AI-driven warfare are also busily hiring ex-military and Pentagon officials to do their bidding. High on that list is former Trump Secretary of Defense Mark Esper. Such connections may be driven by patriotic fervor, but a more likely motivation is simply the desire to get rich. As Ellen Lord, former head of acquisition at the Pentagon, noted, “There’s panache now with the ties between the defense community and private equity. But they are also hoping they can cash in big-time and make a ton of money.”
The Philosopher King
Another central figure in the move toward building a high-tech war machine is former Google CEO Eric Schmidt. His interests go far beyond the military sphere. He’s become a virtual philosopher king when it comes to how new technology will reshape society and, indeed, what it means to be human. He’s been thinking about such issues for some time and laid out his views in a 2021 book modestly entitled The Age of AI and Our Human Future, coauthored with none other than the late Henry Kissinger. Schmidt is aware of the potential perils of AI, but he’s also at the center of efforts to promote its military applications. Though he forgoes the messianic approach of some up-and-coming Silicon Valley figures, whether his seemingly more thoughtful approach will contribute to the development of a safer, more sensible world of AI weaponry is open to debate.
Let’s start with the most basic thing of all: the degree to which Schmidt thinks that AI will change life as we know it is extraordinary. In that book of his and Kissinger’s, they asserted that it would spark “the alteration of human identity and the human experience at levels not seen since the dawn of the modern age,” arguing that AI’s “functioning portends progress toward the essence of things, progress that philosophers, theologians, and scientists have sought, with partial success, for millennia.”
On the other hand, the government panel on artificial intelligence on which Schmidt served fully acknowledged the risks posed by the military uses of AI. The question remains: Will he, at least, support strong safeguards against its misuse? During his tenure as head of the Pentagon’s Defense Innovation Board from 2017 to 2020, he did help set the stage for Pentagon guidelines on the use of AI that promised humans would always “be in the loop” in launching next-gen weapons. But as a tech industry critic noted, once the rhetoric is stripped away, the guidelines “don’t really prevent you from doing anything.”
In fact, Sen. Elizabeth Warren (D-Mass.) and other good government advocates questioned whether Schmidt’s role as head of the Defense Innovation Unit didn’t represent a potential conflict of interest. After all, while he was helping shape its guidelines on the military applications of AI, he was also investing in firms that stood to profit from its development and use. His investment entity, America’s Frontier Fund, regularly puts money in military tech startups, and a nonprofit he founded, the Special Competitive Studies Project, describes its mission as to “strengthen America’s long-term competitiveness as artificial intelligence (AI) [reshapes] our national security, economy, and society.” The group is connected to a who’s who of leaders in the military and the tech industry and is pushing, among other things, for less regulation over military-tech development. In 2023, Schmidt even founded a military drone company, White Stork, which, according to Forbes, has been secretly testing its systems in the Silicon Valley suburb of Menlo Park.
The question now is whether Schmidt can be persuaded to use his considerable influence to rein in the most dangerous uses of AI. Unfortunately, his enthusiasm for using it to enhance warfighting capabilities suggests otherwise:
Every once in a while, a new weapon, a new technology comes along that changes things. Einstein wrote a letter to Roosevelt in the 1930s saying that there is this new technology—nuclear weapons—that could change war, which it clearly did. I would argue that [AI-powered] autonomy and decentralized, distributed systems are that powerful.
Given the risks already cited, comparing militarized AI to the development of nuclear weapons shouldn’t exactly be reassuring. The combination of the two—nuclear weapons controlled by automatic systems with no human intervention—has so far been ruled out, but don’t count on that lasting. It’s still a possibility, absent strong, enforceable safeguards on when and how AI can be used.
AI is coming, and its impact on our lives, whether in war or peace, is likely to stagger the imagination. In that context, one thing is clear: We can’t afford to let the people and companies that will profit most from its unbridled application have the upper hand in making the rules for how it should be used.
Isn’t it time to take on the new-age warriors?
EU Charges Apple With Restricting Competition Under New Antitrust Law
"For too long Apple has been squeezing out innovative companies—denying consumers new opportunities and choices," a European commissioner said.
European Union regulators on Monday filed preliminary charges against Apple for restricting competition in its App Store, the first case under a landmark antitrust law that came into full effect in March.
Apple's rules of engagement "prevent app developers from freely steering consumers to alternatives channels for offers and content," the European Commission (EC), the executive branch of the E.U. that handles antitrust regulation, wrote in a statement.
The commission's findings follow an investigation, announced in March, of Apple and other tech firms for non-compliance with the Digital Markets Act (DMA), which was designed to allow smaller tech companies to compete and lower prices for consumers.
"For too long Apple has been squeezing out innovative companies—denying consumers new opportunities and choices," Thierry Breton, a European commissioner responsible for digital markets, wrote on social media.
In a reference to Apple's slogan, "Think different," Breton quipped that it should be "Act different."
“Act different” should be their new slogan🍏
For too long @Apple has been squeezing out innovative companies — denying consumers new opportunities & choices.
Today we are taking further steps to ensure AppStore & iOS comply with #DMA pic.twitter.com/e741oV9r9l
— Thierry Breton (@ThierryBreton) June 24, 2024
The DMA was designed to prevent Big Tech firms from using their market power to dominate the industry.
"In football terms, this is about getting your players onto the pitch. Imagine how easy it would be for one of the teams to win their game tonight if they made sure that the rival team couldn't even get into the stadium. This is in fact what we often see in the digital world: many companies get stuck in their changing room," Margrethe Vestager, an EC official in charge of competition policy, said in a speech delivered Monday about the law.
The DMA was also designed to give regulators a way to streamline antitrust efforts so they don't get bogged down in years of litigation, a process that could be tested in the current Apple case.
The EC sent its findings to Apple on Monday and the company now has a chance to respond to the charges, with the commission scheduled to reach a final decision by next March. Monday's action was akin to the "halfway stage" in a traditional antitrust lawsuit in which a company is issued a statement of objection and a chance to reform its practices, The Guardianreported.
If the findings are finalized, Apple would have one year to comply or face a penalty of up to 10% of global revenues. The company took in $383 billion last year. However, E.U. regulators aim for dialogue that leads to compliance, rather than issuing a penalty, according to The Guardian.
The DMA has kept the EC busy. In addition to the charges, the commission also announced on Monday a new investigation into Apple's iOS business terms, including the "core technology fee" it charges for every download of the app after 1 million downloads in a year.
"The developers' community and consumers are eager to offer alternatives to the App Store," Vestager, the commission official, said regarding the newest probe. "We will investigate to ensure Apple does not undermine these efforts."
Big Tech companies including Apple, which have been deemed "gatekeepers" by E.U. regulators, have challenged the DMA in court to try to limit the law's scope.
Apple's antitrust battles are not limited to Europe. "The charges underscore the risk to the company's business from increased regulatory scrutiny around the world," The New York Times reported.
The U.S. Department of Justice and sixteen states filed a landmark antitrust suit against the company in March alleging that the company "illegally maintains a monopoly over smartphones by selectively imposing contractual restrictions on, and withholding critical access points from, developers." The United Kingdom and Japan have also recently investigated and taken legal action against the company.
Why Wall Street Wants You to Fear AI
The same Wall Street firms and their media cousins that want us to marvel at the shock and awe of AI, are destroying jobs the old-fashioned way – through stock buybacks.
Goldman Sachs, the infamous Wall Street “vampire squid” (aptly so dubbed by Matt Taibbi), wants to scare the hell out of us. It reports that more than 300 million jobs worldwide could be affected negatively by artificial intelligence programs and that “roughly two-thirds of U.S. occupations are exposed to some degree of automation by AI.”
How convenient! Wall Street is off the hook. They aren’t job killers – AI is. And there’s not a damn thing any of us can do about it, because there’s no stopping science and technology from their god-like domination of society. AI will gobble up your job and you will just have to make do.
Big finance knows we’ll eat this up because we always do. Since the dawn of the industrial era, we’ve been fascinated by the power and prowess of modern machinery. We love stories about robots and computers taking over the world, fighting us to the finish. It is, after all, truly amazing what we, the recent descendants of chimpanzees, are capable of inventing. We have to marvel when making a phone call to the other side of the world in a split second. And it is indeed chilling to have AI programs write us a heartfelt love poem in an instant.
So yes, we are inclined to believe that AI is the most powerful, far reaching job killer to ever have roamed the planet. But it isn’t. In terms of jobs loss, it’s just a distraction, the shiny object that gets our attention while Wall Street picks our pockets.
More than 300 Wall Street hedge funds feasted at the trough. There’s your job killer.
The same Wall Street firms and their media cousins that want us to marvel at the shock and awe of AI, are destroying jobs the old-fashioned way – through stock buybacks. They kill jobs in order to stuff more money into their pockets and they’d greatly prefer us not to notice.
There is a direct connection with most mass layoffs and stock buybacks, but seldom if ever is that reported. Hell will freeze over before Goldman Sachs issues a report that shows how stock buybacks are destroying the jobs of millions of working people while enriching the already wealthy.
For those new to this game, a stock buyback is when a company uses its revenues to buy back its own shares to boost their price. Yes, this is stock manipulation, and it was once outlawed. Now it’s legal and companies are using nearly 70 percent of all their earnings to buy back and boost the price of their own shares.
Why? Reason number one is that Wall Street firms, usually big hedge funds, will buy up a company’s stocks with borrowed money, gain a certain amount of control, and then demand the company buy back stock so the hedge fund makes a killing in a hurry.
Reason number two is that CEOs receive most of their compensation through stock incentives. Boost the price of shares through stock buybacks and CEOs instantly get richer.
How to pay for all this? Through mass layoffs, orders of magnitude greater than AI. In January 2024 there were 82,307 job cuts in the economy. Only 381 were due to AI.
But wait. That’s right now. In the future might not the numbers reverse? After all, AI’s journey has just begun.
Indeed, it has, but as I detail in Wall Street’s War on Workers, virtually every study of the job impact of automation shows that it’s a very slow process. Also, the entry of automation doesn’t necessarily mean that the number of jobs in an automated industry will decline. After robots marched through the auto industry, overall employment actually increased. In Japan, the world’s leader in automotive robotics, the auto industry provides lifetime guaranteed employment.
Sure, this time it could be different, with AI proving to be an exceptional job killer. But that belief is based on fantasy and fear, amplified by the media, and not by actually examining the causes of job loss. In our economy, the big job killer is stock buybacks.
In 2023, Facebook, Google, and Microsoft announced 43,000 layoffs. Yet just before those announcements, in the third quarter of 2022 alone, these companies conducted $28 billion in stock buybacks. In the past five years, they have used $383 billion in stock buybacks to boost their stock prices. More than 300 Wall Street hedge funds feasted at the trough. There’s your job killer. (For the gory details see Chapter 11 of Wall Street’s War on Workers.)
How do we stop them?
The policy part is easy to imagine. Once again prohibit stock manipulation by outlawing stock buybacks. Also, attach one simple clause to every corporation getting a federal contract – no compulsory layoffs during the life of the contract. You can’t take taxpayer money (amounting to approximately $700 billion a year) if you’re going to force taxpayers out of their jobs. If you want to lay someone off it must be voluntary, which means you have to buy them out. You don’t want to do that? Don’t take the federal money.
The hard part is building a movement big enough to force politicians to take on Wall Street. We estimate that 30 million of us have gone through a mass layoff since 1996. Count the families of laid off workers and probably half of the U.S. workforce has been negatively affected by mass layoffs. The labor movement needs to make mass layoffs a major cause and build a new organization that mobilizes this constituency – something like Workers United Against Mass Layoffs! If millions join, maybe politicians will start to listen.
To get there, however, we first need to defeat the technological fatalism that make layoffs feel inevitable and unstoppable.
Financial looting, not AI = Mass Layoffs!