https://pinboard.in/u:jerryking/public/ recent bookmarks from jerryking 2026-07-04T07:10:14+00:00 https://www.economist.com/leaders/2026/07/02/america-should-not-imprison-frontier-ai jerryking>New rules<< often come out of >>disasters<<. America’s Federal Reserve was founded following the Panic of 1907, when stock prices fell by half. Pressure from muckrakers such as Upton Sinclair brought about the Food and Drug Administration. The Securities and Exchange Commission was founded during the Great Depression. >>Artificial intelligence<< has not yet caused a calamity, but it might. Models like **Anthropic’s Mythos** and **Openai’s gpt-5.6 Sol** are extraordinarily good hackers and could become capable advisers to bioterrorists. Understandably, the Trump administration is trying to regulate the technology before >>catastrophe<< strikes. It is working with ai companies on voluntary standards that could soon be released. Unfortunately, its efforts so far have been a mess. Anthropic was its first victim, slapped with export controls in mid-June after the release of Fable, a guardrailed version of Mythos. That came not long after a row between the company and the Pentagon. Fears of a grudge were allayed when the administration appeared to compel Openai to limit access to its Sol model. Then, on June 30th, the Commerce Department abruptly lifted the ban on Fable after Anthropic fiddled with its safety protections. Throughout, the government has seemed to make up rules on the fly. Its decisions have also had an unpleasant >>nationalistic<< tinge. At first it restricted Fable only for non-Americans; Anthropic decided that a wholesale block was the only way to comply. It looks as if the administration pulled the only lever available, knowing that it was a de facto ban. But throughout the past month’s brouhaha, the government has made clear that Americans’ ai access takes precedence over foreigners’. Now that America has started licensing ai releases, it is unlikely to stop. But >>regulating<< **frontier ai** is tricky. >>China’s<< top models are only months behind America’s, and most are >>open-weight<<, meaning anyone can run or tinker with them. One recent release, glm 5.2 from z.ai, already matches the best of the last generation of American models. Chinese labs may take longer to catch up with Mythos, since they have fewer chips and American labs are cracking down on distillation, when competitors use the outputs of the best models to train their own. But that buys months, or a year at most. America could ban Chinese >>open-weight<< models and punish foreigners who use them. But even if it managed to enforce its ban, a vast home market would keep China’s model-makers going. So a permanent block is unworkable. It is also undesirable. Many American ai firms and researchers rely on Chinese models, which are cheap and malleable. The intelligence that makes new models dangerous also makes them tremendously useful. Worries about China aside, a gulf between publicly available and restricted models is a problem. Societies adapt to ai best when improvements arrive gradually, not in a great lurch. Imagine the mess if >>regulators<< bottled up several generations of Mythos-style advances. The few with access would acquire great power. The sudden jump in capability whenever the models did get released would unleash chaos. How then can models like Mythos and Sol be safely set free? The emerging norm provides for an evaluation period and a staggered release to trusted institutions. That is a good start, but it needs formalizing. Some choices, such as **how much risk to tolerate**, belong to elected leaders. But politicians should not be micromanaging the process or horse-trading with ai companies, as they do today. Once those goals are set, politicians should stand back. Evaluating a model is a technical problem. Governments have some expertise, for example in America’s Centre for ai Standards and Innovation or Britain’s ai Security Institute (aisi). But the >>private sector<< has more. The finance and electric-power industries offer structures where oversight is **carried out by industry bodies** [i.e. = "self-regulation"], overseen by government. Something similar might help amalgamate knowledge from the ai labs, research groups and foreign bodies such as aisi. Ideally, America would work with its allies on >>ai regulation<<. Alas, it is hard to imagine >>Donald Trump<< giving up the immense >>sovereign power<< that stems from control of >>frontier models<<. Locking others out of ai is not in America’s economic or strategic interest, but neither were indiscriminate tariffs or threats to Greenland. So other countries must build leverage with their own ai sectors and regulations, and find fail-safes for American >>export controls<<. They could, for instance, ensure that businesses can easily switch to non-American models that run on non-American data centres. It is far wiser to depend on America than on China, but they would be mad to ignore the risks.]]> Anthropic artificial_intelligence China Claude_Fable Claude_Mythos disasters Donald_Trump frontier_models nationalism natural_calamities new_rules OpenAI policymaking regulations risk-tolerance risks sovereign_power export_controls institutions open-weight private_sector regulators self-regulation AI_regulation privileged_access https://pinboard.in/ https://pinboard.in/u:jerryking/b:ab560bd3313b/ 2026-06-29T12:54:46+00:00 https://archive.is/20260628144514/https://www.ft.com/content/794aa75d-5188-4036-91ca-7fc70b61faf8#selection-1447.0-1461.10 jerryking>physical AI<< can have the larger long-run productivity upside because it targets physical bottlenecks,” says Daniela Rus, director of the Massachusetts Institute of Technology’s Computer Science and Artificial Intelligence Laboratory. “After all, most working hours are still spent moving atoms, not bits.” Developed nations in Europe and Asia have already made strides integrating robots into assembly lines to drive higher growth. But AI enables robots to also learn and adapt in complex production, construction and logistics environments, which can boost efficiency and quality, and slash changeover times between different products. Early deployments illustrate the potential. >>Foxconn<<, which produces intricate electronics including iPhones, found that vision-guided, self-adjusting robotic arms improved its assembly cycle times by up to 30%, while reducing error rates by 25%. Adoption by Amazon in a US warehouse found that package-carrying robot fleets fitted with AI have learned to navigate around moving humans and obstacles, cutting their travel time by 10%. (This video demonstrates how physical AI works in industrial settings.) Next, AI-powered robotics could alleviate labour shortages in rich nations. University-educated talent is in ample supply for knowledge-intensive services jobs, which now appear to be on the frontline of LLM disruption. But manufacturers frequently cite a lack of workers as a constraint in production. In a 2026 survey by consultancy Capgemini, more than 50% of industrial executives said labour shortages, costs and regulation would be among their top five reasons for adopting physical AI. (Autonomous machines can also conduct bespoke repairs in environments and conditions that are hazardous to humans.) Political tensions over immigration policy, ageing demographics and shifting attitudes towards physical work raise the long-term case for investing in AI-enhanced robotics. Though the technology will displace some jobs, it will also create higher value-added roles on the factory floor, where knowledge of manufacturing processes is still needed to supervise, reconfigure and train robots. (In rich nations, where anxiety about AI’s impact on jobs is rising in dominant white-collar work, a shift towards embedding the tech into manufacturing might be relatively less politically disruptive.) Finally, physical AI complements efforts by governments to boost domestic supply-chain resilience in critical industries. Indeed, multitasking machines could reduce the need for large assembly lines, which means production can take place at home at a lower marginal cost. There is, then, a clear economic and political case for rich-world policymakers to place greater emphasis in supporting the adoption of physical AI in industry. China has made significant advances in applying the technology to the real world and Beijing’s latest five-year plan includes a strategic pivot towards “embodied AI”. The transition will take time in the west. Capital, further developments in world models and vast quantities of training data are required. The necessary supply chains to build robotics hardware are essential, too. And factories and warehouses need redesigning. But venture capitalists are increasingly seeking out investments in robotics. There are, of course, broader applications of embodied AI. Use of autonomous vehicles, such as robotaxis, is growing. Humanoids are often touted as the future of social care and household chores. And use cases in surgical robotics look promising. Yet manufacturing is likely to offer the fastest route to scale. Relative to roads, homes or hospitals, factories are more contained areas that can be designed around machines. Rather than building technology that mimics humans, firms can create specialised robots to achieve levels of speed, precision and endurance well beyond human limits. LLMs have demonstrated AI’s ability to process information. But for rich nations seeking greater growth and economic resilience, the bigger opportunity lies in applying that intelligence to production. After all, the greatest technological transformations tend not to replicate what humans can already do, but enable what they cannot.]]> physical_AI robotics AI-augmented artificial_intelligence atoms_&_bits automation blue-collar ChatGPT China components Foxconn high-wage industrial_policies industrial_robots large_language_models manufacturers physical_world self-perception specialized_component_suppliers supply_chains trends white-collar factory_floors https://pinboard.in/ https://pinboard.in/u:jerryking/b:f66267002ae0/ 2026-06-29T12:34:20+00:00 https://archive.is/20260629045042/https://www.ft.com/content/ce505663-9567-40a1-ab9d-91b6bdb90a17#selection-1447.0-1783.13 jerryking>single storyline<<. The AI boom is now so powerful and widespread in nature that it is overwhelming all other drivers of returns and shaping a new AI-based world order. The relative performance of the world’s major stock markets over the past year can be explained by how much exposure they have to AI. Nations with a large foothold in the “stack” of industries developing AI >>infrastructure<< and services are massively outperforming, while those without are lagging by record margins. The winners include the US and China, thanks above all to their foundational AI models; Taiwan and South Korea on the strength of chip manufacturers; Japan and Israel on a broad array of AI skills. The partial winners are secondary suppliers. They include nations that are exporters of circuits, servers and other AI-related electronic hardware — such as Mexico, Thailand and Vietnam — or that play a role in the >>AI stack<< as both exporters and sizeable bases for >>data centres<<, such as Malaysia and Singapore. The losers include much of >>Europe<<, with the odd exception (the Netherlands is a major supplier of advanced chips from one big company). Worst off are those countries that lack “AI plays” and rely heavily on the industries most exposed to disruption, including IT services. In the US, AI plays constitute more than 40% of the market cap and have accounted for more than 80% of the returns this year. The return and concentration profile is similar in Japan and even more extreme in South Korea and Taiwan. In China, all the action is taking place in newer growth-oriented segments of the market, while the old-economy sectors struggle. Meanwhile, the likes of India and the Philippines, which are perceived to be at the wrong end of the AI-wrecking ball, are well in the red this year. While the internet frenzy of the late 1990s was also an overpowering global phenomenon, it was not so narrowly focused. The leading tech subsectors back then were communications equipment, semiconductors and wireless telecom services, which accounted for 60% of global market gains at the dotcom peak in early 2000. So far this year, the three leading tech subsectors (semiconductors, hardware and electronic equipment) have contributed a significantly larger share of global market gains, over 70%. Also, unlike the dotcom peak, when tech-fuelled returns were spilling across industries and markets, today they are sucking money away from non-AI industries and nations. Even in the US, investment outside of the tech sector is declining in real terms. Meanwhile, foreigners keep pulling money out of countries seen as peripheral to the AI boom, from the UK to Indonesia. Global investors may be focused almost exclusively on AI, but they are not choosing winners at random. The leading AI nations are long-established tech powers with a deep commitment to R&D, spending more than 3% of GDP on average — over three times the level of lagging countries. They also invest heavily in technology, with tech spending averaging 3.7% of GDP among AI winners, compared with 2.7% for partial winners and 1.6% for losers. To be sure, no leader’s position is secure. In the US, the performance of the dominant Mag 7 tech stocks is increasingly diverging, with three up, three down and one flat for the year, while all face some form of foreign competition, often from China. In China, giants such as Alibaba and Tencent are still trying to determine how to profit from AI and are down around 30% this year. The real AI momentum in China is with newer tech companies, often listed on secondary boards that are much better known to local than to foreign investors, such as ChiNext; it is up 35% for the year. In Japan, market leadership has shifted sharply towards tech over the past year, with semiconductors up 200% and computer memory pioneer Kioxia rising by 3,500% to become the nation’s single largest stock. The AI booster effect continues to help power many economies through one crisis after another, from the tariff war to the Iran oil shock. Expectations for GDP growth have risen by nearly a full percentage point for the AI winners since the start of the year, while falling significantly for the losers. In countries like the US, Taiwan and Korea, the large gains in advanced manufacturing, the associated surge in profits and the wealth effect from the AI-led stock market gains keep lifting economic growth. In countries like China, Thailand and Mexico, tech exports are rising rapidly enough to offset weakness in other parts of their economies, including domestic demand. In short, it’s an AI-driven world. Of course, this >>monomania<< will not last for ever. The speculative enthusiasm will fade even as the technological revolution endures and expands in scope. As was the case following the railroad boom of the 19th century and the internet craze at the turn of this century, a more balanced global market will eventually re-emerge. But so long as investors continue to see AI as the sole foundation of the next world order, they will keep ranking nations based on their tech prowess. ]]> artificial_intelligence hierarchies new_world_order AI_stack Alibaba China competitiveness_of_nations data_centers Europe infrastructure Israel Japan monomania Ruchir_Sharma semiconductors single_storyism South_Korea sub-assemblies Tencent U.S. https://pinboard.in/ https://pinboard.in/u:jerryking/b:7324cea46e9b/ 2026-06-05T10:15:21+00:00 https://www.chinatalk.media/p/doj-vs-data-espionage jerryking>adversaries<< plan to weaponize obscure data types — including >>geolocation<< data, DNA sequencing, and >>undersea cable<< transmissions; ** How China managed to purchase genomic data on millions of Americans through healthcare investments; ** Why black box >>data brokers<< keep records of who goes to >>casinos<<; ** How the >>DOJ<< plans to protect your data, and whether their plans can be thwarted by gridlock in Congress. The risk of data weaponization Jordan Schneider: What does this proposed rule do? Lee Licata: The executive order allows the DOJ to set up a new program that will prohibit or restrict certain types of commercial transactions between a US person and a country of concern or a covered person — which is someone who is owned by, controlled by, or subject to the jurisdiction of a country of concern — where that commercial transaction would afford the country of concern access to either bulk sensitive personal data or government-related data. Now, the regulation itself sets out two prohibitions and three restrictions. The two prohibitions are on data brokerage. In other words, the sale or leasing of access to data on a US person to either a country of concern or a covered person, or transfers of genomic data, which we see is one of the most sensitive categories of data. Both of those will be prohibited in the initial regulations. The other piece of this is the restrictions. Restricted transactions could be allowed if the transaction can be commenced with certain security measures in place, such as data anonymization. There are three restrictions — investment agreements, employment agreements, and vendor agreements. Those are transactions that do have some national security risk, but that risk may be lower relative to the economic value of those commercial relationships. Devin DeBacker: Bottom line: what we’re talking about are counterintelligence risks — the ability of foreign adversaries to take some data and use it to influence someone in the US to do something they want. Data can provide leverage to a foreign adversary, or allow them to identify useful people to begin with. Jordan Schneider: The list of countries is not super surprising — Venezuela, Iran, North Korea, China, Russia, Cuba. But the list of specific data types is quite interesting — genomic data, biometric data, personal health data, geolocation, financial data, and certain kinds of personally identifiable information. How did you decide what to include and what not to include? I want to emphasize that there’s a huge difference between a national security regime like this and a privacy regime. Privacy regimes like the one in California cover a broader, longer list of data types. Regulating expressive data is not the goal. Things like text messages, emails, academic publications, and music are not covered under this program. Lee Licata: The rule wouldn’t cover the phone book, as we like to say. Jordan Schneider: I enjoyed the fact that you put Lee’s phone number into the proposed rule so that people can call you if they have any complaints. Lee Licata: That’s right! That’s part of a transparent rulemaking process. We do need to make ourselves available to hear input from the public. Jordan Schneider: What’s so scary about the specific types of data included in the new rule? Devin DeBacker: I’ll talk about genomic data first because it has some unique characteristics. We think this category is the most sensitive out of the data types because it’s the one with the lowest proposed bulk thresholds. Genomic data exposes vulnerabilities in people and populations. Genomic technology that is used to design disease therapy can also be used to identify genetic variability in a population. Variations can be linked to susceptibility to disease, which can be used for good purposes as well as nefarious purposes, including bioweapons that target those vulnerabilities. There are large genetic data sets that are used for tracing ancestry, solving crimes, and research. Those can be misused for surveillance and for repressing certain segments of society. Matt Olsen, the assistant attorney general, calls this threat “Transnational repression.” Those genetic vulnerabilities in an individual or a population can be used for the same sorts of targeting, counterintelligence, and blackmail intimidation. The reason genetic data is so particularly sensitive, though, is that it’s persistent in a way that your bank account PIN and your IP address aren’t. Those can be easily changed, but you can’t change your DNA sequencing very easily. Jordan Schneider: Wow, uh, that’s scary. I made a joke during the Biotech 101 show that someday terrorists will be able to create a designer drug to kill Jordan Schneider and no one else. But evidently, you have information that leads you to believe that targeting big swathes of people based on their race is a real concern. Devin DeBacker: I’ll say one more thing — the IC has been warning about this for a while. They put out a series of bulletins, including one that detailed China’s track record of collecting, analyzing, and using genetic data to track and repress the Uyghur community in China. It’s pretty worrisome. Lee Licata: We’ve already seen Chinese companies making investments in the US market, particularly in healthcare, in companies that have access to this kind of data. In 2013, the Beijing Genomics Institute (BGI) bought the US company Complete Genomics, which had DNA sequencing on millions of Americans. In 2015, WuXi Pharma bought the US firm NextCODE in similar circumstances. We struggle to think of a legitimate commercial reason for a foreign-adversary-based company to have access to millions of Americans’ genomic data. The Chinese have exploited our open investment climate and made investments in the health sector that give them access to this kind of data. Jordan Schneider: I can imagine that this might cause some scary situations during a conflict, in which an adversary could use to AI generate calls that appear to be from the mothers of key personnel, saying that there’s a family emergency and that they need to desert immediately. [Editor’s note: Russia has already deployed such tactics in Ukraine.] Lee Licata: Correct. The ability to use big data analytics creates a far more effective and targeted means of conducting espionage and blackmail. The ability to use technology to find the needle in the haystack has just been transformed over the last few years. But a lot of the data we’re finding can provide a really clear picture of people’s patterns in life. For example, Duke did this study where they tried to see what sort of data on military members, veterans, and government employees they could buy from data brokers. They found about 8000 data sets related to those types of people. Those people may be valuable assets because of where they work or the information they have. But some of the things they could find in those data sets were really revealing. You could buy access to data about how often a person frequents casinos. Combine that with some financial data about someone and what debt they might have, that’s a really interesting data point for a foreign intelligence service. Jordan Schneider: What about location data? Why do you guys care about other countries knowing where people are? Devin DeBacker: There’s concern about foreign adversaries targeting, identifying, and tracking dissidents. Belarussian journalist in exile Roman Protasevich was arrested after Belarussian authorities tracked his location. Authorities called in a fake bomb threat, forcing Protasevich’s flight to make an emergency landing in Minsk. Source. But when we talk about geolocation data, it goes beyond just tracking dissidents. We are concerned about aggregated insights. When the Strava heat map was published, researchers were very quickly able to take that information — which in theory was only relevant to fitness and exercise — and use it to map government facilities and military bases. That’s just one data set from one company. You can imagine the kind of aggregated insights that would allow a foreign adversary to have if they had many data sets or a broader slice of data. It’s both a micro-targeting concern and a macro-targeting concern. Six arresting - and strange - images from Strava Global Heatmap | road.cc Strava heat map of Burning Man. Subsea cable coercion Jordan Schneider: What’s the 101 on Team Telecom? Lee Licata: Team Telecom is an interagency body composed of representatives from the DOJ, the Defense Department, and Homeland Security. That body is tasked with reviewing certain types of FCC telecom licenses that have requisite foreign ownership or a foreign nexus for national security and law enforcement risk. Over the last few years, though, probably the big focus area of this committee has been submarine cables, and it’s articulated in this EO. This is a space where we see a lot of this kind of data risk as we look at the evolution of the cable market. Jordan Schneider: What is so interesting about undersea cables? Lee Licata: 95% of the world’s Internet traffic now moves through a subsea cable. They’re an extremely important piece of infrastructure for connecting the world digitally. But here’s what’s happened over the last few years. Traditionally, cables were owned by telecommunications companies — the Verizons and AT&Ts of the world — as a means of moving their traffic between networks and different continents. But over the last few years, what we’ve seen is that cables are now part of the cloud. What we’ve seen is the cables being built by the large hyperscalers and the cloud operators to connect their data centers on a global scale. In other words, to move lots of data around their architecture. Now, most of the cables that Team Telecom looks at are being built by Google, Meta, Amazon, or Microsoft. There’s a very different national security risk profile that comes with those kinds of cables, both in terms of the sensitivity of data that’s running over those cables and the volume of data that’s running over those cables. This is a piece of infrastructure that we weren’t really thinking about a decade ago, but now we see it as a critical node and a vector for this kind of national security risk. Jordan Schneider: Why is a Meta cable more worrisome than a Verizon cable? Lee Licata: Because of what moves over it. When those companies are building cables to connect data centers, what they’re really doing is moving their back-end data around the world. All your text messages, Facebook data, Instagram algorithm information, WhatsApp communications, and the documents you keep in the Google Cloud — that’s what those cables are moving. It’s a different type of traffic that has more sensitivity in our view, and the volume is just wildly different. The cables that we’re seeing built now are starting to bend the laws of physics in terms of the amount of data that can run through them. Jordan Schneider: It’s not just Western firms building cables, Huawei has also announced lots of China-to-Africa cables. How can these cables pose a threat? Lee Licata: We usually think of two things — landing location and ownership. Now, a lot of cables are owned through consortia. It’s not one company that owns the cable, but it’s a group of companies that all make investments into the infrastructure, and then they each own a part of it to move their traffic. Source. For example, the PLCN (the Pacific Light Cable Network) was originally proposed to land in Hong Kong as well as Taiwan and the Philippines. One of the owners was a Chinese telecom company called Dr. Peng, alongside Google and Meta. For us, when we look at that risk scenario, landing in Hong Kong was very high risk because the Chinese were re-exerting their influence over Hong Kong at that time. The second concern was having the Chinese company in the ownership consortium, which would allow them access to all of the cable’s infrastructure. Ultimately, we recommended to the FCC that the cable not land in Hong Kong, and to get rid of that one owner, which the consortium did. Then they came back to us with a new cable application that only comprised Google and Meta, and we then entered into mitigation agreements with both parties. Devin DeBacker: A couple of years ago, the ARCOS-1 cable was proposed to go from Miami to Cuba. That was the first outright denial that Team Telecom recommended. Lee Licata: As we see in many of these cables, the owners of the cables can lease capacity and allow others to use them. What we articulated in the recommendation was that the ultimate customer for the cable to Cuba was actually the Cuban government, not the applicants for the landing. The executive rule-making process and public input Jordan Schneider: In the ANPRM phase of regulation, people get to read the lovely 30-page document you published and send you comments, which is a neat process. This document also included a list of questions that you have for the public. Would you like to highlight some open-ended questions to our readers at home? Devin DeBacker: One of the big questions is where to set the bulk thresholds. The program applies to sensitive personal data related to government personnel and locations, and the threshold for that is zero. But we also care about bulk data on non-government personnel. That’s because, in sufficient quantities, those datasets could be used to draw aggregated insights, as we mentioned before. The question is, what is that quantity? For geolocation data, would info on 10,000 US persons per year be weaponizable if it were in the hands of a Chinese or Russian company? For personal health data, what number of people would it take to draw dangerous insights? One million? What is the right number? That really doesn’t have a lot of precedent. It has to account for risk, as well as economic impact. It has to account for smurfing concerns, which is a technique for circumvention by lumping together smaller transactions over time to get the amount of data you need. There are other types of circumvention as well. That’s one area where we’re very interested in feedback. Lee Licata: Another area I’ll highlight is the impact on the private sector. In the ANPRM, we outline a menu of both physical and logical access controls, as well as privacy-enhancing technologies and data anonymization techniques. So the question is, how effective can those controls be at protecting a data set in one of these transactions? How feasible is it for companies to deploy such measures? How much will it cost? We would like input from the private sector in this area. Jordan Schneider: Why was the Department of Justice tasked with this instead of the FTC or some other government organ? Devin DeBacker: This program is a national security authority addressing counterintelligence risks that live in the private sector. That’s what the DOJ does. We do it through CFIUS, we do it in Team Telecom, we do it in civil and criminal enforcement of export controls and sanctions. The DOJ’s focus on corporate compliance and our expertise in data security made us the right choice for the job. We’re going to have to create a new unit here in the foreign investment review section, which Lee is the inaugural head of. We’re going to have to hire a significant number of attorneys and non-attorneys. We’re going to have to have a team responsible for licensing. We’re going to need a team responsible for targeting and designating covered persons and covered entities. We’re going to need a team responsible for regulatory development. We’re going to need to expand our team of subject matter experts, and we’ll need a compliance and enforcement team. But we’re going to need a significant expansion, and that expansion has already begun. Jordan Schneider: Do you have to sell yourselves to Congress? Who decides if Lee gets staff? Devin DeBacker: Yes, this will need new money. We’re working with OMB and Congress to make sure that we can secure the resources necessary to bring this program online. Jordan Schneider: What happens if you don’t? Do we just not get the rules? Devin DeBacker: We’re going to continue in the rulemaking process. The next step is issuing the NPRM, which we’ll do later this summer, and then we’ll move forward on the rest of the program, including once that comment period is over, we’ll have a final rule out. When the comment period for the NPRM is over, we’ll begin thinking about what our initial lists of designated cover entities look like and so on and so forth. Let’s not put the cart before the horse. This is an area where there’s a lot of bipartisan and nonpartisan support. There’s been a recognition across administrations, across parties, and across houses of Congress that the data threat posed by foreign adversaries is real and we need to secure ourselves. ]]> 21st._century adversaries casinos China data datasets data_brokers de-anonymizing Department_of_Justice espionage gene_sequencing geolocation undersea_cables weaponization location_data https://pinboard.in/ https://pinboard.in/u:jerryking/b:6e0428ca82cb/ 2026-06-03T14:35:36+00:00 https://archive.is/20260602080850/https://www.ft.com/content/42fc2ea1-cd3a-43d1-87c6-eba09a44d888#selection-1447.0-1833.11 jerryking>subsidies<< and >>protectionism<<. After all, it is hard to remain competitive against enterprises that benefit from state support. But trying to play China at its own game overlooks an inconvenient truth: the country has a >>comparative advantage<< in >>industrial policy<< itself. China’s ability to mass manufacture a wide range of goods at low cost stems from the governance that enables it. **Centralized control** allows >>Beijing<< to easily mobilize resources and co-ordinate measures — across provincial governments, state-owned banks and regulatory bodies — to meet its policy goals. Limited democratic accountability also gives the Chinese Communist Party the ability to pursue long-term industrial policy and sidestep opposition, such as planning disputes. China combines this **central power** with intense decentralized competition. Regional officials and enterprises compete for state backing, which is often conditional on performance, creating strong incentives to prioritize output and innovation ahead of profits. This model of state-led capitalism has been refined over decades and has underpinned the country’s ability to nurture entire industries, scale and develop dense, vertically integrated supply chains. (It has also generated a lot of waste.) By contrast, liberal market democracies operate with greater accountability to voters and shareholders. Decision-making is more decentralised, which makes it harder to co-ordinate industrial operations or deliver infrastructure quickly. And even if western governments acquired the necessary fiscal firepower and bureaucratic competence, replicating China’s heft would remain a costly, multi-decade endeavour. For measure, less than 15% of Chinese EV firm BYD’s cost advantage per vehicle when compared with Tesla is estimated to come from subsidies and preferential terms, based on data from Rhodium Group. The remainder is driven by supply chain control, industrial clustering and economies of scale. Western nations need a better way to allocate their finite resources. One option is to lean into their own institutional comparative advantages. “Throughout history, centralized bureaucratic structures have been most adept at spearheading technological catch-up,” economist and economic historian Carl Benedikt Frey told me. “But decentralized political systems are better at exploring new technological trajectories, where no one yet knows what the winning technology will be.” This implies prioritizing frontier innovation, such as in AI, biotechnology and advanced computing, which thrives in open research and venture capital environments. How could this look in practice? First, rather than dispersing subsidies and protectionism across a wide range of industries, these distortive and costly measures could be targeted towards building supply-chain resilience and capabilities in sectors critical to national security. Next, Beijing’s manufacturing advantage would be considered less of a threat and more a source of low-cost inputs for domestic innovation and the energy transition. (Encouraging Chinese firms to build factories in western countries, provided they share technology and hire domestic workers, would also help limit the loss of key manufacturing knowhow.) This would then allow western governments to devote more resources to upskilling workers displaced by import competition, while pursuing the reforms needed to strengthen their countries’ competitiveness. These include reducing barriers to investment, innovation and entrepreneurialism. China is, of course, becoming an increasingly formidable innovator in its own right. But that only strengthens the case for the west to avoid becoming distracted by the urge to recreate its manufacturing dominance. Beijing does not always play by the rules of free trade. However, pushing it to do so, retaliating with protectionism or attempting to nurture entire industries are not viable strategies. Instead, the west might be better off simply leveraging the benefits of Chinese scale, while focusing on its own strengths. As Frey says: “The risk for the west is that, if it tries to replicate China’s growth model, it ends up fighting the last war.” ++Robotic arms at an industrial plant in China. Chinese companies maintain state support conditional on performance, which means output and innovation are prioritized over profits++ ]]> China China_rising comparative_advantage industrial_policies the_West Beijing capitalism centralized_control competitiveness decentralization fighting_the_last_war liberal_democracies manufacturers national_security play_to_your_strengths protectionism state-directed subsidies supply_chains upskilling https://pinboard.in/ https://pinboard.in/u:jerryking/b:597711d3a379/ 2026-05-25T21:43:43+00:00 https://illuminem.com/illuminemvoices/power-before-performance jerryking>export controls<<, training models five to ten times more efficiently while subsidizing >>data centre<< power in industrial zones, is the clearest signal of that shift. Subsidized electricity in designated zones partly offsets the weaker efficiency of domestically produced accelerators, and at scale it works. The binding constraint has moved past silicon to the availability, location and quality of firm power at the grid edge. The implication for the UK is sharper than the FT piece allows. Liz Kendall's hardware initiative and the £2bn quantum programme are sound on their own terms. Neither solves the problem that a domestic photonics or quantum start-up still has to plug into a grid with connection queues into the next decade, on industrial electricity tariffs that sit at the top of the IEA basket. Owning a node in the >>compute stack<< does not solve the power constraint underneath it. The deeper claim in Power Before Performance is that sovereignty in this era comes from combining firm power with dense layers of local compute embedded in everyday infrastructure. The UK is closer to that than the FT framing suggests. Tens of millions of regulated endpoints in homes and pockets generate continuous high-fidelity data on how the country uses energy and communications, flowing through a domestically licensed connectivity layer to a national digital identity infrastructure, under a data-sharing framework enacted last year. That is sovereign by foundation. The work is alignment across access governance and sovereign processing on top of it. The race the FT describes is real and the UK should compete in it. The race underneath, which the article does not describe, is the one the UK can still win.]]> artificial_intelligence electric_power energy power_grid China compute_stack data_centers export_controls https://pinboard.in/ https://pinboard.in/u:jerryking/b:ca0ae4eff0f9/ 2026-05-25T21:34:47+00:00 https://notes.pinboard.in/u:jerryking/e7dc8fc9720440fbd30d jerryking acoustic_data AI-augmented arms_race art_of_the_squeeze ASML artificial_intelligence autonomous_weapons breakthroughs China compute_stack computing_power critical_infrastructure data_centers deep-pocketed DeepMind digital_warfare embargoes export_controls Google GPUs hyperscalers human_brains Jensen_Huang lack_of_capital leverage memory_wall middle-powers military_network_integration military_power MoD national_champions national_infrastructure national_security Netherlands neuromorphic Nvidia Palantir Project_Maven quantum_computing second-rate self-sufficiency semiconductors sensor_data sensor_fusion South_Korea sovereignty sovereign_AI start_ups Taiwan technological_dependence technological_sovereignty TSMC UK_military United_Kingdom warfare Washington_D.C. weaponizing_interdependence weaponry https://notes.pinboard.in/ https://pinboard.in/u:jerryking/b:a396e2ef81e0/ 2026-05-24T18:58:57+00:00 https://archive.is/20260523084754/https://www.ft.com/content/5aecd7b6-652f-4edb-b666-71f3f50fc43e#selection-1906.0-1919.14 jerryking>military power<< increasingly depends on access to computing. Governments are beginning to treat it as earlier generations treated oil and electricity grids: as >>infrastructure<< on which economic strength, military capability and political independence depend. Some even see >>computing power<< as a prerequisite for >>sovereignty<< itself, much as nuclear technology defined geopolitical power in the 20th century. But for technological “>>middle powers<<” such as the UK, there is a problem. The overwhelming majority of global AI >>computing power<< — experts reckon 90% — is controlled by companies in the US and China [i.e. = "hyperscalers"], leaving others searching for ways to secure a foothold in what policymakers and executives now call the “>>compute stack<<” — the chips, networks, data centres and specialized hardware that underpin modern AI. “>>Semiconductor<< chips are such an integral part of modern high-speed computing technology that they should be thought of as >>critical<< to a nation’s future in the way that water or clean air are,” Experimental technologies are playing a growing role in Britain’s search for computing sovereignty. The Ministry of Defence (>>MoD<<) has trialled systems for tracking satellites and space junk that use the neuromorphic vision sensor from van Schaik’s company Optera, and has discussed using the technology for drone tracking. The MoD also bought an experimental >>quantum computer<< from London-based ORCA computing in 2022 — probably the first quantum computer bought by a defence ministry. The interest comes as a new generation of weaponry depends on AI. The latest fighter planes generate terabytes of >>sensor data<< every hour they fly, processed by classified models. Submarine hunting relies on analysis of >>acoustic data<< that used to be done by humans wearing headphones, but now the ocean can be listened to by algorithms looking for anomalies. **Digital battlefield brains** [i.e. = "military network integration"/"sensor fusion"] such as the >>Maven<< Smart System, software designed by >>Palantir<<, already play a huge role in warfare, while computing will determine the effectiveness of autonomous weapons. For some, Britain’s dependence on foreign — mainly American — providers for AI and cloud services is dangerous. “Take an extreme example,” says Nigel Toon, chief executive of Graphcore, a Bristol-based chip designer. “Let’s say you were dependent on a large foreign >>hyperscaler<< for your compute. The way the security codes work, they could effectively "brick"" the whole >>data centre<< wherever it was in the world.” Situated in the King’s Cross area of London, the Neuroware Centre is surrounded by symbols of Britain’s prowess in computing. Nearby is the Alan Turing Institute — named after the man who invented modern computing and, in the process, saved the free world. Around the corner in St Pancras Square is DeepMind, Google’s AI research arm. It is a reminder that Britain’s **second-tier** status in AI was not inevitable. The country produced many of the intellectual foundations of modern AI and remains home to some of the world’s strongest academic research. But the UK has repeatedly struggled to convert that scientific talent into technology companies capable of competing with US and Chinese giants. The problem, executives and investors say, is not ideas but >>capital<<.[i.e. = "lack of capital"] No sooner does a promising British >>start-up<< mature beyond its early stages than it is absorbed by >>deeper-pocketed<< foreign investors or tech groups. >>DeepMind<< is the clearest example. Founded in London in 2010, it was acquired by >>Google<< just four years later. Although >>DeepMind<< has remained in Britain, where it has been central to the development and running of Google’s Gemini AI models, ownership migrated overseas. “[Google’s acquisition of] DeepMind was a huge blow to British AI,” says one expert who asked to remain anonymous. “Yes, they are still in London. But we missed a chance to make a great British company.” Researchers and executives argue, however, that the next technological shift could offer Britain a second chance. “The UK, if one is honest, has probably lost the race in AI,” says Sebastian Weidt, chief executive of Universal Quantum, a >>quantum computing<< >>start-up<< in Haywards Heath, south of London, and a professor at the nearby University of Sussex. “In >>quantum computing<<, there is a unique opportunity, once in a generation, that we can build a trillion-dollar company here in the UK.”.........quantum computing technology has become enmeshed in the politics of >>technological sovereignty<< and >>national security<<. In March 2026, the UK government announced a £2bn quantum funding initiative aimed at building domestic capability. Around the world, states are pouring billions into national quantum programmes while tightening controls on talent, intellectual property and collaboration. “There’s world-leading stuff going on in this country in quantum,” says Weidt. “Double down on that now and we do something great.” He adds: “AI, it’s too late. They all talk about AI, they want to build more data centres and so on, which is fine. But the danger is the same thing happening in quantum. There’s already consolidation happening, there are already quantum companies leaving the UK.” Last year, for example, Oxford Ionics, a leading UK quantum company, was bought by Maryland-based quantum hardware company IonQ for more than $1bn. Quantum computing may not live up to expectations. But already, there are proposals to use it in systems such as the UK-Italian-Japanese next-generation fighter, the Global Combat Air Programme, while scientists have shown that a quantum computer will eventually be able to break traditional encryption, rendering everything from cryptocurrency to national secrets vulnerable. The shift to a quantum arms race is visible even in Weidt’s own academic network. He still tries to stay in contact with former graduate students scattered across the global industry. But it has become harder to keep in touch with some of those who have returned to China. “In some cases, it seems like they have vanished,” potentially working for sensitive state-backed programmes, where collaboration is no longer possible, he says. Chinese government spending on quantum programmes is now roughly $17bn, compared with $9bn each for the US and Japan, according to data assembled by Qureca, a quantum technology research organization. This quantum push is likely to be driven by fear of >>technological dependence<<, experts say, in the wake of a US ban on advanced chip exports that has fuelled a drive for >>self-sufficiency<<. Toon reckons that 2022 legislation denying China access to powerful Graphics Processing Units (>>GPUs<<) may have forced it to adapt by learning to make AI models five to 10 times as efficient. “They’re designing these models in such a way that they burn less compute.” The consequences of the US using chips as >>leverage<< [i.e. = "art of the squeeze"] are now felt globally. Today, in the wake of President Donald Trump’s efforts to prise Greenland from Denmark earlier this year, US allies say they have every right to fear that their access to US chips could be threatened. “I wouldn’t be surprised to see them use GPUs as leverage to some degree. And they could use that in any way they like,” says Dave Grimm of AlbionVC, a UK venture firm. During Trump’s visit to the UK last September, he arrived with executives from Nvidia, Microsoft and other US technology giants. Supporters argued that the partnerships announced — more than $100bn in commitments — would cement Britain’s place inside the global AI economy, but they also deepened unease that Britain risked becoming less a >>sovereign AI<< power than a downstream customer of American digital masters, giving >>Washington<< >>leverage<< it might eventually use. While >>Jensen Huang<<, >>Nvidia<<’s chief executive, insisted that buying his company’s graphics processors would provide “>>sovereign AI<<”, others are sceptical. “It is sovereign until a future American president decides that you can’t have it,” “I am seeing a whole bunch of countries, between China and the US, who are very interested in gaining some degree of control over their own destiny.” In an April speech, UK technology secretary Liz Kendall announced a domestic AI hardware initiative to secure Britain’s capability in chips and semiconductor technologies, adding that she would not accept “defeatism” from those claiming the AI race has been lost. In the same month the government launched a £500mn fund, known as Sovereign AI, to support homegrown AI start-ups. This month it also pushed pension funds to drastically raise investments in private markets, including technology venture capital. “There is a long-term ambition to do as much as the government can do to anchor UK start-ups and UK technology in the UK for UK impact,” says Michael Cuthbert, director of the National Quantum Computing Centre. ]]> AI-augmented arms_race art_of_the_squeeze ASML artificial_intelligence breakthroughs compute_stack computing_power critical_infrastructure data_centers deep-pocketed embargoes export_controls GPUs hyperscalers human_brains leverage middle-powers military_power MoD national_champions national_infrastructure national_security neuromorphic Palantir Project_Maven memory_wall Netherlands self-sufficiency semiconductors South_Korea sovereign_AI start_ups Taiwan technological_dependence technological_sovereignty TSMC UK_military United_Kingdom warfare weaponizing_interdependence weaponry autonomous_weapons second-rate acoustic_data military_network_integration sensor_fusion digital_warfare quantum_computing sensor_data sovereignty China DeepMind Google Jensen_Huang lack_of_capital Nvidia Washington_D.C. https://pinboard.in/ https://pinboard.in/u:jerryking/b:bfacb8209089/ 2026-05-18T19:19:01+00:00 https://archive.is/20260518102812/https://www.theglobeandmail.com/business/commentary/article-globalization-gutted-canadas-manufacturing-heres-how-we-make-things/#selection-2575.0-2587.11 jerryking>physical AI<<” and by advanced manufacturing technologies. To see why, let’s begin with how a modern factory works. Production requires >>blue-collar<< workers on the >>factory floor<< to operate machines and move material around, but it also requires >>white-collar<< supervisors who can oversee and co-ordinate the production process. The cost of this more expensive supervisory labour is equal to about half the cost of all the production workers whom they oversee in a typical manufacturing company in Canada. Countries such as >>China<< have been successful in attracting manufacturing from developed countries not simply because of cheap production workers, but because they also have capable and diligent managers and supervisors who earn a fraction of what their U.S. or Canadian counterparts do. Arda, a startup founded by former OpenAI research chief Bob McGrew, is targeting these supervisory wage costs directly. Its software uses advanced video models to observe what happens on >>factory floors<<, learn real-world workflows, and then apply that knowledge with artificial intelligence to train robots and co-ordinate people, machines and materials across the entire production cycle – from initial design to final assembly. The stated goal is to make manufacturing in high-wage regions cost-competitive again and reduce reliance on China-centred supply chains. Wage bill for factory workers in Canada In billions of dollars Operators and labourers $32.18 Supervisors $16.52 THE GLOBE AND MAIL , Source: statistics canada If such platforms work, they will dramatically reduce the need for on‑site supervision of labour, logistics, administration and co-ordination, where white‑collar fixed costs loom large. Every time a decision or workflow shifts from human managers to software that can be copied at near‑zero cost, the managerial and administrative overhead required to run an efficient plant falls. Lower fixed costs, in turn, reduce the minimum efficient scale of production. Instead of needing a continental market to justify a single giant plant, running smaller, highly automated factories that serve national or even regional markets becomes viable. This comes on top of a longer-term transformation in blue‑collar work. Industrial robot installations have more than tripled worldwide over the past decade, and Canada’s deployments, largely concentrated in the automotive sector, have also increased significantly. As robots and AI systems take on more physical tasks, wage differences between countries matter less. What matters more is access to capital, energy costs, logistics and political risk. Now, add one more technology to the mix: industrial-scale 3-D printing and other forms of additive manufacturing. These tools allow entire components or products to be built layer by layer directly from digital files, often with far less tooling, waste and setup time than traditional methods. Studies and industry analyses point to a world in which companies that can 3-D print substantial parts of their products benefit from shorter supply chains, cheaper prototyping and the ability to produce closer to the point of use. Crucially, additive manufacturing lowers both the capital and co-ordination costs of producing complex items in smaller batches, aligning with the strengths of smaller economies. Put these trends together, and the picture is striking. The economic logic of manufacturing is shifting toward smaller‑scale, more distributed and more knowledge‑intensive production. That shift creates a historic opening for small and medium‑sized economies. Could Canada produce its own smartphones, appliances and advanced industrial components across a network of smaller, AI‑driven factories? Technically, the answer is increasingly yes. With AI platforms reducing supervisory overhead, robots handling more of the physical work, and 3-D printers producing complex, customized parts without the vast tooling costs, the traditional reasons for concentrating production in a handful of low‑wage megahubs are weakening. Some constraints remain. Comparative advantage does not disappear entirely. Canada will still be relatively better at producing critical minerals, low-carbon energy, agricultural products and forestry resources than at producing certain mass-market consumer goods. Supply chains for highly complex products such as smartphones will continue to rely on vast global networks of >>specialized component suppliers<<. And some highly capital-intensive industrial processes – from blast furnaces to large shipyards – will continue to exhibit strong economies of scale. But these constraints are no longer insurmountable across all sectors. The combination of AI-orchestrated factories and additive manufacturing reduces the penalty for not being the world’s cheapest labour market or the largest single consumer market. It allows Canada and other countries like it to host viable plants in sectors where they were previously priced out, capture more value from their resource endowments, and develop new export-oriented niches in advanced manufacturing that integrate into global value chains on far more equal terms. For Ottawa, these innovations point to the need for a clear economic strategy. Canada already lags many of its peers in robot density and in the adoption of advanced manufacturing technologies outside the auto sector. If the minimum efficient scale of production is about to fall sharply across a wide range of industries, the first movers will lock in new clusters of plants, suppliers and skilled workers. Countries that hesitate will, yet again, export raw materials and import finished goods made elsewhere, thus remaining “>>hewers of wood and drawers of water<<,” without capitalizing on the full potential of this new AI- and >>3-D<< printing-driven industrial revolution. The policy response must be unapologetically ambitious. Canada should treat physical AI and additive manufacturing as core components of its industrial strategy, not as afterthoughts. That means accelerating the deployment of AI‑enabled factory platforms, investing in 3-D printing capabilities and skills, and removing regulatory and tax obstacles that deter capital from backing new plants on Canadian soil. If we act now, the prize is substantial. We will be a country that can produce far more of what it consumes at a profit, that anchors new high‑value export sectors, and that competes in advanced manufacturing on brains, data and energy rather than on cheap labour. It is a future in which small and medium‑sized economies are no longer relegated to the sidelines of global manufacturing. How these new technologies rewrite our economic fortunes is up to us to decide. ]]> 3-D AI-augmented artificial_intelligence automation blue-collar Canada Canadian-owned_innovation China Fen_Osler_Hampson globalization GoC high-wage industrial_policies industrial_robots manufacturers middle-powers Ottawa physical_AI supply_chains trends white-collar hewers_of_wood_and_drawers_of_water self-perception components specialized_component_suppliers robotics factory_floors https://pinboard.in/ https://pinboard.in/u:jerryking/b:57cf55015d2c/ 2026-05-13T19:43:50+00:00 https://archive.is/20260513192728/https://www.theglobeandmail.com/opinion/article-trump-china-trip-xi-new-world-order/#selection-2599.0-2599.16 jerryking China Donald_Trump Konrad_Yakabuski new_world_order rare_earth_metals summits U.S.-China_relations Xi_Jinping superpowers https://pinboard.in/ https://pinboard.in/u:jerryking/b:df3230162ca2/ 2026-05-12T18:30:29+00:00 https://stephenroach.substack.com/p/sun-tzus-advice-for-donald-trump jerryking>tariff<< shock was aimed at the rules-based global trading system established by the United States. This year’s military shock is aimed at the Middle East, long the world’s most volatile region. Trump committed these reckless acts without any regard for their likely consequences [i.e. = "downstream consequences"]. No surprise, both have backfired. Despite sky-high “reciprocal” tariffs against America’s purportedly abusive trading partners, the US trade deficit hit a new record in 2025. And despite all the bluster about obliterating Iran’s military power, Iranian missiles and drones continue to wreak havoc in the Middle East, while the country’s strategic >>chokehold<< on the >>Strait of Hormuz<< has led to the world’s largest-ever oil shock. Amid these failures, Trump has set his sights on stabilizing relations and building rapport with >>China<<, America’s most formidable strategic competitor. That has meant bending over backward to preserve his upcoming summit with Chinese President >>Xi Jinping<<, currently scheduled for May 14–15. After postponing the meeting once already due to complications from his war of choice, Trump is so desperate to cut a deal with his “good friend” that he recently turned over a drug smuggler and trafficker to China as a demonstration of good faith. Others claim the summit timeline has been extended to enable Trump to travel triumphantly to >>Beijing<< after having declared victory over Iran. Whatever the reason, America will be at a distinct disadvantage at the summit. Trump needs a win more than Xi does. The Chinese leader is perfectly content to sit back and watch his American counterpart debase himself. A deeper perspective can be found in the counsel of >>Sun Tzu<<, ancient China’s (6th century BC) renowned warrior-philosopher. In The Art of War, he stressed that, “When your strategy is deep and far-reaching … you can win before you even fight.” That certainly applies to Xi and his willingness to observe, rather than counter, his adversary. It also applies to Trump and his lack of forethought in declaring a false trade emergency and waging an illegal war. >>Iran<<, for its part, understands the importance of strategy. Despite suffering leadership decapitation and significant damage from the US-Israeli air campaign, Iran maintains a major >>strategic advantage<< with its chokehold the >>Strait of Hormuz<<. The real question is why the US didn’t figure this out. Look no further than the new >>National Security Strategy<< released by the Trump administration late last year. The word “Iran” appeared only two times in the 29-page document. Of course, Trump’s short-sighted fixation on the tactics of obliteration also may have had something to do with it. But why didn’t Trump think strategically before he >>acted impulsively<>Sun Tzu<<’s emphasis on the importance of >>advice<<. Trump acts on the basis of personal >>whim<<. He wants to be surrounded by sycophants, rather than honest brokers who >>speak truth to power<<. **Scornful of experts** [i.e. = " eschewing advice/expertise"], Trump has stated that the war will end when “I will feel it in my bones.” Sun Tzu, arguing for discipline and reason, wrote, “Assess the advantages in taking advice, then structure your forces accordingly … strategically, based on what is advantageous.” A deal-focused Donald Trump **does not have a strategic bone in his body**. He emphasizes the number of wars he has allegedly ended (ten, according to his latest tally), tariff revenue (purportedly from abroad), and exaggerated amounts of investment committed by foreign countries to rebuild US capacity. Never mind that these claims are all fictitious—they are now deeply ingrained in the gospel of MAGA and its leader. By contrast, Xi represents a tradition, dating back to >>Sun Tzu<<, that elevates strategy to the highest order. While that does not always work out perfectly for China—I have my own concerns about the efficacy of the current economic rebalancing strategy—the Chinese leadership deserves enormous credit for the value it places on >>strategic thinking<<. The May summit between Xi and Trump is shaping up to be an historic mismatch between a strategist taking the long view and a false prophet proclaiming his supposed successes. Trump, as always, will spin a tale of lies and distortion, underscoring the contrast between The Art of the Deal and The Art of War. >>Sun Tzu<<’s perspective would insist that, “The one with many strategic factors in his favor wins.” For two consecutive years, Trump has made massive, illegal policy blunders. I am already worrying about 2027. By that point, if current polling is any indication, Trump’s MAGA faction will have lost control of at least one house of Congress, and American-style autocracy will hopefully be in decline. But an unpopular, angry, and vindictive president will be licking his wounds, intent on retaliating ahead of the 2028 election cycle. This is not a risk to take lightly. It will be up to a new congressional leadership to right the course for the US. Sun Tzu gets the final word on that possibility: “>>Leadership<< is a matter of intelligence, trustworthiness, humaneness, courage, and sternness.”]]> advice advice-taking China China_rising classic_texts Donald_Trump strategic_thinking summits Sun_Tzu U.S. U.S.-China_relations Xi_Jinping choke_holds deal-making Iran leadership strategic_advantages strategy-less acting_impulsively Beijing downstream_consequences NSS speaking_truth_to_power Strait_of_Hormuz U.S.-Israel_War_on_Iran whims eschewing_advice/expertise tariffs https://pinboard.in/ https://pinboard.in/u:jerryking/b:abbf7701d03c/ 2026-05-12T15:00:56+00:00 https://archive.is/20260512041002/https://www.ft.com/content/5fefc72b-aded-46d6-b509-1904204ca8b0#selection-1557.0-1855.18 jerryking>Strait of Hormuz< have weaponised the world’s most important oil chokepoint and the global economy is painfully adjusting accordingly. In the >>Red Sea<<, >>Houthi<< attacks drove war risk premiums on a $100mn ship close to $1mn per voyage at their July 2025 peak. Most major carriers avoided the Suez Canal and stayed on the Cape of Good Hope route for nearly two years, adding 10 to 14 days to transit and several hundred dollars in surcharges to the average 40ft container. And on a contested island in the western Pacific, a single company produces more than 90% of the world’s leading-edge >>semiconductors<<. The viability of >>Nvidia<< and >>Apple<< and the operational capacity of several militaries depends on a few square miles of facilities that no other actor can replicate within a decade. These are not three discrete stories but one. The post-cold war assumption that dependencies were broadly shared and the open economy was a >>global public good<< has quietly come apart. We are living through an age of asymmetry, a transitional period in which power flows less from size or wealth than from the ability to convert >>imbalance<< into >>leverage<<. >>Strategic advantage<< now accrues to actors that recognise the >>imbalance<< and act on it before a new equilibrium settles. While >>Tehran<< and >>TSMC<< compound advantage, others are absorbing costs they haven’t yet learned to price, from the EU’s limited sovereignty over its own consumer data to Volkswagen, whose EV transition rests on Chinese components. Asymmetries can materialise in various ways: how >>leverage<< is exercised, who controls the infrastructure on which >>leverage<< depends and which actors can sustain a position. ##At the operational layer##, the dynamics of modern conflict now favour the disrupter. Ukrainian drones costing a few thousand dollars destroy Russian materiel worth millions. Anthropic’s latest model >>Mythos<< could give any hacker the ability to overpower the most expensive cyber defences. Here, size offers little protection. ##At the infrastructure layer##, some actors hold positions that others depend on. Dollar clearing, chip fabrication, >>rare-earth<< processing, >>hyperscale<< compute, container terminals and >>undersea cable<< repair fleets are >>unevenly distributed<<. >>China<< refines roughly 90% of the world’s >>rare earths<<, and Beijing’s new 2025 licensing regime left defence giant Raytheon scrambling to secure heat-resistant materials for missiles. The 2022 sanctions on Russia demonstrated the reach of dollar architecture. ##At the political layer##, not all actors can sustain the same posture once they have taken it. Authoritarian systems are structurally insulated from the domestic political costs of strategic competition. Democracies, locked into >>electoral cycles<<, are not. What makes this moment so consequential is that the asymmetries reinforce each other. >>Authoritarian<< regimes like China and Russia can spend decades building infrastructural chokeholds that then become the instruments through which pressure is applied. The age of asymmetry will continue to have a profound impact on global >>supply chains<<. Where the diversification of the last decade was geographic — spreading >>supply chains<< and revenues across more countries — this era demands prioritising >>sovereign needs<<. Businesses at the centre of the global economy are beginning to guard against exposure to these >>vulnerabilities<<. Apple plans to produce the majority of iPhones sold in the US in India, pivoting sharply away from its Chinese-built supply chains. Danish and Swedish pension funds have together sold tens of billions of dollars of US Treasuries, citing the unpredictability of American policy. The sectors differ, but the instinct to insulate does not. With sovereignty now the operating principle of resilience, corporate success will require modelling the approaches of countries like Canada and Singapore. This means increasing self-reliance, hardening positions against the leverage others hold, and wielding the >>asymmetric advantages<< they themselves possess — be that proprietary technology, control over critical inputs or world-leading talent. In the age of asymmetry, the most consequential vulnerabilities will often be the >>least visible<<, and the most consequential strengths the least familiar. ]]> Apple asymmetrical authoritarianism cheap_revoution drones electoral_cycles global_public_goods Houthis hyperscalers imbalances leverage Nvidia semiconductors sovereign_needs Strait_of_Hormuz Taiwan Tehran TSMC unevenly_distributed USDA apply_pressure geopolitics vulnerabilities art_of_the_squeeze choke_points Claude_Mythos rare_earth_metals strategic_advantages supply_chains least/less_visible China thinking_in_layers undersea_cables asymmetric_advantages https://pinboard.in/ https://pinboard.in/u:jerryking/b:aec8b99f437f/ 2026-05-08T21:29:36+00:00 https://www.economist.com/international/2026/05/07/americas-submarine-dominance-is-under-threat jerryking China Indo-Pacific Pacific_Ocean submarines threats U.S._Navy https://pinboard.in/ https://pinboard.in/u:jerryking/b:dadeabb72d47/ 2026-05-08T15:38:31+00:00 https://www.washingtonpost.com/opinions/ jerryking>Industrial robots<< are the physical counterpart of the >>artificial intelligence<< revolution that’s reshaping the global economy. These technologies are spreading fast in the defense sector, which for decades has been using traditional production techniques to make “legacy” weapons that cost too much and take too long to build. The new weapons that America needs are robots — drones and other autonomous systems — and many of them will be built and maintained cheaply in ultramodern, software-driven factories. Think of robots as new age replacements for “Rosie the Riveter,” the imaginary heroine of America’s astounding defense buildup during World War II. Perhaps they can even help save the >>Rust Belt<< by using digital tools to fix the broken infrastructure of old manufacturing cities like >>Pittsburgh<<. A road map for this transition is a book just co-authored by Shyam Sankar, chief technology officer of Palantir, titled “Mobilize: How to Reboot the American Industrial Base and Stop World War III.” The message is as ambitious as the book’s title. Sankar argues that defense tech can lead a transformation that ripples across industry. “Manufacturing will start to command the respect and premium it lost decades ago, as digital upgrades and automation increase sectoral productivity,” he writes. “We have a chip on our shoulder” at Gecko, Loosararian tells me, because his company is based in the old industrial hub of Pittsburgh. “Screw Silicon Valley! We’ll build it here in western Pennsylvania for people that nobody ever cared about.” He hopes his robots can help rescue “industries that have been left behind in the digitalization movement.” Gecko illustrates the shift that’s accelerating in American industry toward >>robotics<<, as digital tools perform more of the time-consuming and expensive tasks of traditional manufacturing. The United States is coming late to this party: China installed 295,000 new >>industrial robots<< in 2024 — more than every other country in the world combined. America has a lot of catching up to do. Loosararian was a college senior studying electrical engineering in 2012 when he started Gecko. He visited a 30-year-old power plant near Pittsburgh that was closed 30% of the time because of >>corroded<< pipes that kept bursting. Fixing them with humans perched atop scaffolding was a nightmare. It occurred to Loosararian: Why not build robots to scale the rusted pipes and diagnose the problems? He says his innovation eventually saved the power plant more than $20 million in maintenance. Gecko’s robots are now crawling up pipes, boilers and storage tanks at power plants across the country. They’re also inspecting refineries and other energy infrastructure here and abroad. For the Pentagon, they’re inspecting rusted decks of Navy ships, potentially corroded pipes of submarines and decades-old silos for Air Force ICBMs. As these robots do their work, they create >>digital maps<< [i.e. = "documentation"] to replace drawings and paper records stored in file cabinets — or in the memories of retiring engineers. What began as Loosararian’s vision of a wall-walking robotic lizard is now a company with 275 employees and a valuation of $1.25 billion. Gecko Robotics workers examine a large steel pipe in Pittsburgh. The white robotic arm in the background, invented by Gecko, is capable of detecting defects not visible to the naked eye. (Scott Goldsmith/For The Washington Post) A ruptured steel pipe. (Scott Goldsmith/For The Washington Post) Someday these robot workers will design, manufacture, deliver and maintain many of the products we consume. China already has “>>dark factories<<” making cars, computers and other products — dark because robots don’t need light to do their work. It hopes to have 10,000 such “autonomous factories” by 2030. The >>defense base<< badly needs this disruption. The U.S. spends staggering sums for “exquisite” systems that can’t be produced in sufficient volume or maintained at reasonable cost. Critics liken the Pentagon’s current procurement system to buying a fleet of luxury cars with sky-high repair bills. The folly of this approach has been clear in the Ukraine and Iran wars, where cheap drones have overwhelmed expensive interceptor missiles. In one of its most laudable but least noticed moves, the Trump administration is trying to break this addiction to “legacy” weapons and production systems. President Donald Trump began the process a year ago with an executive order to modernize defense acquisitions. Rather than depending on traditional prime contractors like >>Lockheed Martin<< and >>Northrop Grumman<<, the Pentagon seeks to encourage new players such as >>Palantir<<, >>Anduril<< and little >>Gecko Robotics<<. “We want to allow start-ups to innovate on solutions, as opposed to being dictated a list of features,” Emil Michael, the Pentagon’s chief technology officer, told me in a recent interview. He said he aims to disrupt the moribund >>procurement<< process, with fewer top-down requirements, bigger bets on a half-dozen critical technologies and “faster yesses and faster nos.” Gecko’s defense business focuses on one of the Pentagon’s gnarliest but >>least visible<< [i.e. = "invisibility"] problems — the >>maintenance<< of decades-old ships, missile silos and other >>weapons platforms<<. The company’s first big defense contract in 2022 was to inspect 450 concrete silos for the Air Force’s aging ICBM fleet. Next came the Navy. Because of maintenance delays, only 67% of Navy ships meet readiness standards — a “very weak” performance, according to a recent report by the Heritage Foundation. Inspecting and repairing ships in dry dock can take more than a year. Gecko’s first round of inspections on 12 ships in the Pacific fleet saved 202 days of inspection, Loosararian says. He hopes the Navy will expand the program to all ships in the Pacific and Atlantic fleets. A large steel tank is used to simulate a military ship or similar structure at Gecko Robotics in Pittsburgh. (Scott Goldsmith/For The Washington Post) Gecko Robotics' Toka 5 robots analyze data while looking for defects in a steel tank. (Scott Goldsmith/For The Washington Post) The Navy’s nuclear submarines are especially expensive to repair. I watched Gecko robots crawl the circumference of huge metal tubes that simulate part of a nuclear reactor. The digital repairmen can **find defects** [i.e. = "defect-detection"] 92% faster than humans, Loosararian told me. They cut the time needed to fully inspect a reactor vessel from 300 hours to six. The big payoff for the Pentagon will come when massive, robot-driven factories can radically reduce the cost of making weapons, too. That’s >>Anduril’s<< goal in a project it calls “Arsenal,” which aims to build weapons in software-driven factories at “hyper-scale.” >>Anduril<< was founded by Palmer Luckey, an entrepreneur who made a fortune developing virtual reality headsets and then set out to transform the archaic defense business with cheap drones and other products. A 2024 Anduril concept paper argued that existing production systems are so costly, the Pentagon can’t make enough to last through anything more than a brief war. “We may be ready for day one, but we are utterly unprepared for day 30, let alone day 300,” Anduril’s executives wrote. That shortage of weapons manufacturing capacity has been obvious in the Ukraine war. Now it’s affecting the Iran operation, too. When Anduril’s CEO Brian Schimpf first explained the Arsenal idea to me two years ago, it sounded like a pipe dream. But Anduril expects to open its first mega-factory near Columbus, Ohio, later this year. The company plans to invest nearly $1 billion to build “a >>software-defined<< manufacturing platform that is optimized for the mass production of autonomous systems and weapons.” The aim is to produce mass quantities of drones for air, sea and land — with robots doing part of the manufacturing. The Paul Revere of this defense tech revolution may be Sankar at Palantir. In 2024, he wrote a manifesto he called “The Defense Reformation” that described how in three decades, the nation’s 51 prime defense contractors had collapsed into just five corporate behemoths. Sankar posited “18 Theses” for reform. Among them: Lack of competition is “the root of what ails us,” “cost-plus contracting makes the nation dumber, slower, and poorer” and “risk capital, not taxpayer capital.” >>Palantir<< became an early defense disrupter by creating software systems that allowed the military to **understand its mountains of scattered data** [i.e. = "data fusion"]. The company went on to build systems for Ukraine and Israel that could help target those countries’ new arsenals of drones and autonomous weapons, through “>>Project Maven<<” and other systems. Now the revolution is spreading to the physical world of advanced robotic weapons and systems to build them. People like Loosararian, Schimpf and Sankar are making the dull, dusty world of manufacturing “cool.” They want to replace the old stereotypes I saw 50 years ago covering the steel industry in Pittsburgh — beefy steelworkers operating **outmoded machinery** [i.e. = "aging/old equipment"] while button-down managers enjoyed fancy lunches at the Duquesne Club and let America’s manufacturing dominance slip away. Loosararian is a model CEO for this new age: He greets visitors in a gray T-shirt, jeans and work boots. His corporate headquarters are in an abandoned shopping center. The old Pittsburgh, the smoky inferno that a 19th-century visitor described as “hell with the lid taken off,” has vanished. Maybe the next version of this city will be created by software engineers, dark factories and wall-climbing robots.]]> built_environment David_Ignatius industrial_revolution industrial_economy industrial_robots Pittsburgh start_ups Anduril books China corrosion dark_factories defence_contractors defence_industrial_base digital_maps Gecko_Robotics government_procurement hard_to_detect Lockheed_Martin maintenance manufacturers Northrop_Grumman Palantir robotics Rust_Belt unseen weaponry artificial_intelligence defect-detection weapons_platforms documentation Project_Maven invisibility least/less_visible defense-tech physical_AI lack_of_competition aging/old_equipment data_fusion software-defined software-driven https://pinboard.in/ https://pinboard.in/u:jerryking/b:424703b89661/ 2026-04-27T16:01:56+00:00 https://archive.is/20260328012824/https://www.economist.com/science-and-technology/2026/03/18/the-next-phase-of-artificial-intelligence-may-require-very-different-processors#selection-1251.0-1322.0 jerryking>large language models<< (LLMs). That discovery sent demand for Nvidia’s chips, and its valuation, soaring. Times are changing fast. Demand for AI computing is shifting from **training models** to getting them to answer real-world queries, a process known as >>inference<<. McKinsey, a consultancy, estimates that by the end of the decade >>inference<< will account for three-fifths of demand in AI data centres. Nvidia appears to recognize the shift. On March 16th it unveiled a new >>chip designed<< specifically for inference tasks, the Groq 3 LPX, with an architecture that departs from the traditional GPU. This time, it will have plenty of competition. A crop of startups is building chips aimed at running AI models faster and more efficiently than Nvidia’s. Training and inference place different demands on hardware. Training, in which an AI model is taught to **identify patterns** in vast amounts of raw data, relies on enormous numbers of calculations being conducted in parallel. Nvidia’s B200 chip, for instance, one of the company’s flagship products, contains more than 16,000 processing units, also known as cores, to perform such operations. Inference, in which a finished model calls on its training to respond to user prompts, works differently. It unfolds in two stages: prefill and decode. During prefill, the model processes the prompt and converts it into small units of text, typically about four characters in English, known as tokens. To speed things up, tokenizing different parts of the query can be done in parallel. Decoding then generates the response, token by token. To do this, the model relies on its “weights” (relationships between tokens learned during training) as well as previously generated tokens. These weights are stored in the system’s memory. The need for constant memory access is where modern GPUs fall down. AI processors like the B200 contain small but extremely fast on-chip memory, known as SRAM, as well as a much larger off-chip memory known as DRAM. Accessing DRAM can be ten times slower and consume far more energy than reading SRAM. The problem is worsening. As AI models grow larger and become better at handling long user prompts, their memory demands are rising sharply. A study by Amir Gholami of the University of California, Berkeley, and colleagues finds that over the past two decades computing performance has roughly tripled every few years, whereas off-chip memory bandwidth has improved by a factor of only about 1.6. This “>>memory wall<<” has become the main >>bottleneck<< in increasing the speed of AI inference. You must remember this GPUs rely on software workarounds to cope. One approach splits the two stages across different processors. The prefill phase runs on GPUs optimized for high parallel computing power, while decoding runs on separate GPUs designed for fast memory access. Another technique is batching, where many queries are processed together. Once the model’s weights are loaded, they can then be used for many queries at the same time, reducing repeated trips to the external memory. Nvidia’s new chip uses the power of software to give the on-chip memory a boost. The size of the SRAM is around 500 megabytes—tiny when compared with the B200’s 192 gigabytes of off-chip memory. What makes the difference is smart software that choreographs how every piece of data moves through the chip to maximize computation and memory access. Startups are experimenting with more radical designs. One approach is to simply build a bigger chip. That is the approach taken by >>Cerebras<<, an American chip designer. Its latest chip, the size of a dinner plate, contains an enormous 900,000 cores and 44 gigabytes of on-chip SRAM. Because all data movement occurs within the wafer, Cerebras claims its system can run inference up to 15 times faster than conventional designs. For very large models, however, storing all their parameters on SRAM is impractical. Others are tackling the problem by redesigning how data move through the cores. MatX, a startup founded by former Google chip engineers, builds on an idea used in Google’s tensor processing units (TPUs). These chips rely on what is called a systolic array, a grid of processing elements through which data flow rhythmically, rather like blood pumped through the body. After each calculation the result passes directly to the next unit, bypassing the need to store intermediate results in memory. Traditional systolic arrays, however, are fixed in size. Make them bigger, for larger tasks, and they will often sit idle; make them smaller, and efficiency falls when the larger tasks come through. MatX proposes a “splittable” systolic array that divides the processor into several smaller grids, allocating computing resources differently depending on whether the chip is handling prefill or decode. A third approach, pursued by d-Matrix, a California-based startup, tries to eliminate the memory wall entirely by having the same components handle both memory and computation. This architecture, known as in-memory computing, promises lower energy use and faster inference. Others advocate chip designs built around specific algorithms to improve efficiency further. >>Etched<<, another Californian startup, is designing a chip custom-built to run transformer models, the algorithms that underpin most LLMs. This specialization allows the company to strip away hardware needed for other uses and simplifies the software running on the chip. Researchers in China have proposed an even more radical form of specialization: embedding model weights directly into hardware. In one design from the Chinese Academy of Sciences, these are physically encoded in the layout of metal wires. The authors claim this technique removes the need to fetch parameters from memory, enabling extreme efficiency. Yet such specialization carries risks. Designing a new chip typically takes 12–18 months, whereas AI algorithms evolve far faster. A chip built around today’s dominant model architecture could quickly become obsolete if the field shifts. The chips have yet to fall. Nvidia’s rivals are at different stages. >>Cerebras<< is already on its third generation of chips; d-Matrix expects to release its first widely available version this year. Others, including MatX and Etched, remain in development. Nvidia says the >>Groq<< 3 LPX will reach the market later this year. It is easy to see that the GPU conquered training. Inferring what comes next is harder. ]]> artificial_intelligence Cerebras China chip_design CPUs GPUs hardware inferences large_language_models Nvidia semiconductors training_beds bottlenecks data_centers pattern-detection start_ups computer_memory Groq memory_wall custom-built Etched https://pinboard.in/ https://pinboard.in/u:jerryking/b:d16fb61e38e8/ 2026-04-27T15:25:55+00:00 https://ig.ft.com/global-energy-flows/ jerryking>energy markets<<. Each successive >>shock<<, from Russia’s invasion of Ukraine in 2022 to the US intervention in Venezuela and now the conflict in the Gulf, has both disrupted longstanding flows of oil and gas and reinforced the appeal of US energy, which is not only abundant but geopolitically secure. Even as the latest war pushes up petrol prices at home, Donald Trump has highlighted the upside. “When oil prices go up, we make a lot of money,” he said. For US energy companies, the windfall is already visible. US crude exports surged to a record 5.2mn barrels a day last week, up by more than 1mn barrels on the previous week, as buyers in >>Europe<< and >>Asia<< rushed to secure supplies lost from the Gulf. Earlier this month, more than 65 empty supertankers were heading to the US to load crude, according to data research group >>Kpler<< — almost triple the number in the week before the war began on February 28 and well above last year’s daily average of 28. The number of empty tankers bound for the US to fill up with crude oil, refined fuels and other petroleum products was also at an all-time high........In April, more than a third of Europe’s >>jet fuel<< is expected to come from US refineries, roughly double the level in January, according to >>Kpler<<, which tracks shipments. Rystad Energy estimates that higher prices could boost cash flows at US oil companies by $63bn this year if crude remains near $100 a barrel. While there is a rush in the short term for oil and fuel, in the long term the US gas industry is likely to get a bigger boost. Just as Europe pivoted away from Russian gas towards US liquefied natural gas (LNG) after 2022, Asia may now do the same away from the Gulf. Before the war, the region sourced more than a quarter of its LNG from the Gulf, and about 40 per cent of its oil. Since the Iran conflict began, at least 13 LNG tankers initially bound for Europe have been rerouted to Asia, most of them having set off from the US. Buyers are scrambling for supplies after the war choked off shipments through the >>Strait of Hormuz<<. The waterway remains all but frozen; on Thursday, Trump ordered the US Navy to open fire on any boat laying mines in the strait.......“If you are a European or Asian utility and you are signing 20-year contracts, surety of delivery is super important,” says Paul Gooden, head of natural resources at investment manager Ninety One. “Mentally, this has changed the mindset of consumers. You will see a growing desire to sign up US LNG because it is seen as geopolitically safe.” The White House is treading a delicate political line: the rush for US energy and high international prices are lifting profits for producers, but also pushing up costs for American consumers ahead of midterm elections in November where Republicans are facing a fight to hang onto both houses of Congress. Petrol prices in the US are now averaging above the politically sensitive threshold of $4 a gallon. The administration is betting that prices will ease when the war with Iran ends. But the broader reordering of trade flows could endure, reinforcing the US position at the centre of the global energy system. This is what Trump promised when he returned to the White House last year. He pledged to usher in an era of “American energy dominance”, with supercharged fossil fuel production, lower domestic prices and higher exports of what he previously described as “freedom molecules” around the world. “Energy security,” he said, would “help our country compete with hostile foreign powers.” “Energy is the core of American dominance,” says Andrejka Bernatova, an energy investor based in Houston. “Here is a country that actually has energy resources and is continuing to be proactive in securing more energy resources. Asia and Europe do not have that advantage.”.....America’s evolution into an oil and gas superpower long pre-dates Trump. It was built over two decades through technological innovation, large-scale investment in pipelines and infrastructure and supportive policies under Democratic and Republican presidents alike. In the mid-2000s, the US needed to rely on imports for 60 per cent of its oil. By 2019, oil imports had fallen by a third as >>hydraulic fracturing<< and horizontal drilling unlocked vast domestic >>shale oil<< and gas reserves, unleashing domestic production and helping turn the US into a net total energy exporter. The shale boom delivered cheap oil and gas to power the US economy, and also changed US foreign policy, giving it the leeway to target countries such as Iran, Russia and Venezuela with sanctions.........Harold Hamm, founder of Continental Resources and a close ally of Trump, argues that the shale revolution his company helped pioneer has made the US “totally independent”. With more gas than its domestic pipelines could handle, the US also began building multibillion-dollar export terminals to supercool methane into LNG; the first cargo sailed from Cheniere Energy’s Sabine Pass terminal on the Gulf of Mexico coastline in Louisiana in 2016. Within seven years the US had overtaken Australia and Qatar as the world’s largest exporter of the fuel.......Today, US energy is embedded in global >>supply chains<< in ways that would have been unthinkable a generation ago. A decade ago, Europe imported almost no oil and gas from the US. Last year, it got about 15 per cent of its petroleum oil and over half its LNG from the US . The US now wants to almost double its LNG export capacity again in the next five years, and the White House has been pushing countries around the world to commit to buying more. Asia, which traditionally relied on nearby sources of gas, including Australia, the Middle East and Russia, has been a particular target, with Japan signing a number of long-term contracts for gas and expressing interest in one of Trump’s pet projects, a $44bn plan to ship LNG from Alaska to Asia.........Under the terms of the US-EU trade deal, member states will buy $750bn in American energy by 2028-29. “It is clear that the place to invest in energy in the world, not just for American companies, but for European companies, is here in the United States. I think in the long term that is good for world energy stability,” says Mike Sommers, chief executive of the American Petroleum Institute, an industry group. “You know what's going on in the Middle East with Qatar is another example of why you want to get your LNG from a country that you know has a safe, stable supply.” Sommer’s optimism is tempered by concerns that the US, which has reversed course under Trump to boost oil and gas and cut investment in renewables, could flip again under a future Democratic administration. In October, the head of Shell in the US, Colette Hirstius, warned that such uncertainty was “very damaging”. Last month at CeraWeek, the largest oil and gas conference in the US, several executives warned that chaotic policymaking had created instability, >>price volatility<< and the spectre of recession........America’s growing leverage over the global oil system is underscored by Washington’s recent foreign policy gambits. In January, the US overthrew Venezuela’s authoritarian leader Nicolás Maduro, citing access and control of the nation’s vast reserves as a key motivation. The US coastguard and navy pursued and seized several tankers, as part of operations to secure 50mn barrels of Venezuelan oil. Partly as a result, China’s supply of Venezuelan oil was severely disrupted. In the long term, as US shale reserves become more expensive to recover and production threatens to plateau, having control over Venezuelan oil will be a strategic boon, says Bernatova, the energy investor. “Having a presence in the country will be very beneficial [to US companies and interests],” she says, although she adds that even if shale production slows, the US still has sizeable oil reserves and has always been able to outpace declines by introducing new extraction technology.......For now, US companies are struggling to keep up with demand. New oil and gas projects take years to bring online. The US government estimates that the country’s production will only rise by 340,000 barrels a day over the next 12 months. Shale operators, who can ramp up their production the fastest, are wary of boom turning to bust, with the president often stating that he wants oil prices to fall to a level that would make many of their cost-intensive projects uneconomical. “Washington continues to call for more drilling, while simultaneously signalling they want oil back at $60 as soon as possible. You cannot send both signals at once and expect capital to respond,” says Kirk Edwards, president at Latigo Petroleum, an independent producer based in Texas’s prolific Permian Basin. Other countries are also well-placed to benefit from higher prices, particularly western hemisphere states that are increasing their supply the fastest, such as Brazil, Canada and Guyana. “Any country that’s in the position of boosting supply is going to try and boost supply. Even countries that are looking to decarbonise are still going to try and produce more oil and gas,” says Ira Joseph, senior research associate at Columbia University’s Center on Global Energy Policy. “When you have $100 oil, it incentivizes drilling.” But the chaos caused by the Iran war is unlikely to benefit the oil and gas industry in the medium to long term. Energy-importing countries face sharply higher costs, with some rationing fuel amid shortages. Sustained high petrol prices could boost electric vehicle adoption, benefiting China, which has rapidly scaled exports of low-cost EVs and flooded global markets. A prolonged disruption to Middle East energy supplies could speed up a structural shift in global energy systems away from oil and gas, according to energy research group Wood Mackenzie.........The latest in a series of energy shocks has governments around the world wondering how they can build up domestic energy sources and move away from fossil fuel imports. “The lessons from history are that shocks about energy security leave scars,” says Spencer Dale, BP’s former chief economist. “I’m always struck that the share of oil in global energy peaked in 1973, after the oil crisis, and never came back.” Dale says Europe, which was wounded by its former reliance on Russia for its gas, would worry about being too reliant on US LNG, especially after US officials weaponized energy in trade discussions last month. He suggests Europe could prioritize gas pipelines from north Africa or boost supplies from Central Asia, and that countries could loosen regulations to make their domestic refineries more competitive to ensure they have enough fuel. Governments are also likely to boost any domestic sources of energy, including coal, nuclear and in particular renewables while also promoting electrification and efficiency. In that scenario, US oil and gas would get “a bigger piece of a smaller pie”, says Kingsmill Bond, an analyst at energy think-tank Ember. The trend is already visible. In the three years after the full-scale invasion of Ukraine, the EU’s rollout of solar and wind accelerated threefold, according to Fatih Birol, head of the International Energy Agency. EU gas use remains below pre-invasion levels. That comes on top of years in which >>China<< has built a >>renewable<< industry no other country can match, bolstering its >>energy security<< and giving it a stranglehold on clean tech >>supply chains<<. “The discussion about renewables has shifted rapidly from climate and emissions to how they can benefit >>energy security<<,” says Daniel Yergin, vice chair of S&P Global and author of The Prize: The Epic Quest For Oil Money & Power. Yergin argues that **price spikes** — such as the ones set off by Trump’s war on Iran and Putin’s war on Ukraine — “are very disruptive economically and politically. They destroy demand and force fuel switching by customers.” The full-scale invasion of Ukraine in February 2022 meant people were finally willing to pay a premium on energy security, he says. “That changed it, and this situation in Hormuz has really changed it too.”]]> Asia books energy energy_security energy_supremacy Europe hydraulic_fracturing leverage LNG oil_industry policy_uncertainty shale_oil U.S. U.S.foreign_policy U.S.-Israel_War_on_Iran weaponizing_interdependence China fracking natural_gas renewable Donald_Trump energy_superpowers Strait_of_Hormuz supply_chains Daniel_Yergin EU exogenous_shocks price_hikes energy_markets Kpler price_volatility jet_fuel https://pinboard.in/ https://pinboard.in/u:jerryking/b:53f21551e28b/ 2026-04-24T04:26:11+00:00 https://archive.is/20260423053641/https://www.ft.com/content/cac5870b-5507-4130-b4fd-a1c60d0ed6f3#selection-1875.0-1875.14 jerryking bullying China EU every_man_for_himself great_powers Mark_Carney middle-powers https://pinboard.in/ https://pinboard.in/u:jerryking/b:a52487b27788/ 2026-04-15T05:50:38+00:00 https://www.wsj.com/opinion/america-benefits-from-unstable-energy-markets-b9503d09?mod=hp_opin_pos_2 jerryking>instability<< in the region—-particularly when that >>instability<< reinforces American advantages.......The >>liberal order<< was built on the theory that >>economic interdependence<< restrains conflict. Countries that traded together would avoid confrontation. Infrastructure would be protected because everyone depended on it. That theory is under strain. America, the system’s architect, is also the actor best placed to benefit from its selective erosion......As rivalry between the U.S. and China intensifies, >>interdependence<< is no longer seen by Washington’s strategic class as mutual restraint. It is a map of >>vulnerabilities<<. China’s industrial model depends on imported hydrocarbons. Around a fifth of global oil consumption passes through the >>Strait of Hormuz<<. If a competitor’s growth depends on stable energy access, introducing >>uncertainty<< >>imposes costs<< that tariffs and sanctions can’t match. Washington didn’t invent this dynamic but has learned to operate within it. Recent U.S. policy shows a greater tolerance for >>instability<<, particularly when it reinforces American advantages in energy production, capital attraction and alliances. This is less doctrine than instinct—a preference for a system in which >>disruption<< **falls unevenly**.........That logic intersects with Iran’s approach. >>Tehran<< doesn’t need a decisive military victory. Its >>leverage<< lies in calibrated disruption: pressure on shipping lanes, targeted strikes on infrastructure, activation of proxy networks. The aim is to >>impose costs<< while preserving the regime. The record is clear. On Sept. 14, 2019, a coordinated drone and cruise missile attack—which the U.S., Saudi Arabia, France, Germany and the U.K. attributed to Iran, though Tehran denied involvement—struck Saudi Aramco’s Abqaiq processing facility and the Khurais oil field. The strikes knocked out 5.7 million barrels a day, roughly 5% of global supply—the largest single oil supply disruption ever recorded. Oil prices surged nearly 15% when markets opened the following Monday. Full production was restored within two weeks, though the infrastructure was still under repair.......The episode demonstrated something the market couldn’t unlearn: The world’s most critical energy node could be disabled in a single night by a swarm of low-cost drones. Recent disruptions in the Red Sea—Houthi attacks that have raised insurance costs for commercial shippers, forced vessels to reroute around the Cape of Good Hope, and added weeks to supply chains—have compounded that vulnerability. The architecture of globalization is more >>fragile<< than it appeared. Since roughly 2019, the system has entered a managed phase. Iran probes. >>Gulf states<< absorb and harden. China adapts. The U.S. is positioned to benefit, as the economy best able to absorb shocks and attract capital seeking stability........That positioning reflects underlying structure. America is the world’s largest oil and gas producer. It has robust capital markets and strong legal protections. When >>volatility<< rises, capital gravitates toward systems that can contain it. Supply tightens globally; American production and financial inflows strengthen in relative terms. This isn’t a stable equilibrium. It is one in which the >>gains from disorder<< accrue unevenly—and in which restoring stability isn’t always the dominant strategy. Shaping the terms of instability can be more advantageous. Three actors will determine how long this dynamic lasts. The first is >>Iran<<. Its strategy, which has a narrow margin for error, depends on **sustaining pressure** without provoking overwhelming retaliation. A miscalculation could shift the system from controlled disruption to open conflict, in which infrastructure becomes a target rather than a signaling device. The >>Gulf states<< face a different constraint. Their economic transformation depends on stable revenue. Their security requires managing persistent threats. Coordination with Washington has held. Its durability will determine whether volatility remains contained......>>China<< has maintained distance from the region’s security architecture while managing its exposure through diversification, reserves and diplomacy. A sustained escalation would force >>Beijing<< to make a choice: either expand its presence or accept a vulnerability that can no longer be managed externally. Even without escalation, the effects are visible. >>Energy markets<< show persistent >>volatility<<, with prices increasingly driven by >>geopolitical<< signals rather than supply and demand alone. The **consequences propagate outward** [i.e. = "downstream consequences"] —first into food systems, then into fragile states, then into migration pressures at the borders of more-resilient economies. >>Financial markets<< adjust accordingly. Risk reprices more frequently. Capital concentrates where liquidity is deepest and legal protections are strongest. The gravitational pull toward the U.S. strengthens. What appears as market logic is often >>geopolitical<< positioning expressed in price. There is a further step, seldom discussed but increasingly plausible. The U.S. could move from passive beneficiary to active participant in shaping energy flows. Existing law allows restrictions on crude exports on national-interest grounds. Even limited use of that authority would tighten global supply while easing domestic conditions, widening the spread between American and international prices. Such a move would be contested. Producers would resist. Allies would object. In a system already strained by disruption, control over where supply clears becomes a source of >>leverage<<. The option itself shifts expectations. The deeper change concerns the order that governed the past half-century. The architects of the >>liberal order<< are now using it as it always could have been used—as an instrument of >>pressure<< by those who designed it, directed at those most dependent on it. For the U.S., the direction is clear: Consolidate advantages in energy, capital and alliance networks, while tolerating more global >>disorder<<. For others, the conclusion is less comfortable. The infrastructure that enabled their growth was never neutral. It was contingent. The question isn’t whether the system is changing. It is whether those who relied on the old one can adapt before the new one hardens around them. ]]> America_First antifragility apply_pressure bullying downstream_consequences economic_nationalism energy energy_markets geopolitics imbalances instability interdependence leverage liberal_order Middle_East nodes predatory_practices pro-entropic resilience Strait_of_Hormuz uncertainty unpopular_ideas vulnerabilities weaponizing_interdependence weaponizing_uncertainty unstable disorder mercenary_motives beggar-thy-neighbour disruption domination economic_interdependence Iran China drones financial_markets fragility gains_from_disorder globalization Gulf_states imposing_costs Persian_Gulf Tehran U.S.-Israel_War_on_Iran unevenly_distributed return-on-chaos energy_supremacy https://pinboard.in/ https://pinboard.in/u:jerryking/b:3d065aa893ab/ 2026-04-12T02:02:00+00:00 https://www.nytimes.com/2026/04/07/opinion/anthropic-ai-claude-mythos.html jerryking>artificial intelligence< — one that arrived sooner than expected and that will have equally profound >>geopolitical<< implications. Anthropic announced Tuesday that it was releasing the newest generation of its large language model, dubbed Claude Mythos Preview, but to only a limited consortium of roughly 40 technology companies, including Google, Broadcom, Nvidia, Cisco, Palo Alto Networks, Apple, JPMorganChase, Amazon and Microsoft. Some of its competitors are among these partners because this new A.I. model represents a “>>step change<<” in performance that has some critically important positive and negative implications for >>cybersecurity<< and America’s >>national security<<. This is not a publicity stunt. In the run-up to this announcement, representatives of leading tech companies have been in private conversation with the Trump administration about the implications for the security of the United States and all the other countries that use these now vulnerable software systems, technologists involved told me. For good reason. As Anthropic said in a written statement on Tuesday, in just the past month, “Mythos Preview has already found thousands of high-severity vulnerabilities, including some in every major operating system and web browser. Given the rate of A.I. progress, it will not be long before such capabilities proliferate, potentially beyond actors who committed to deploying them safely. The fallout — economics, public safety and national security — could be severe.’’ Project Glasswing, Anthropic’s name for the consortium, is an undertaking to work with the biggest and most trusted tech companies and critical infrastructure providers, including banks, “to put these capabilities to work for defensive purposes,” the company added, and to give the leading technology firms a head start in finding and patching those vulnerabilities. “We do not plan to make Claude Mythos Preview generally available, but our eventual goal is to enable our users to safely deploy Mythos-class models at scale — for cybersecurity purposes, but also for the myriad other benefits that such highly capable models will bring,” Anthropic said. My translation: Holy cow! Superintelligent A.I. is arriving faster than anticipated, at least in this area. We knew it was getting amazingly good at enabling anyone, no matter how computer literate, to write software code. But even Anthropic reportedly did not anticipate that it would get this good, this fast, at finding ways to find and exploit flaws in existing code. Anthropic said it found critical exposures in every major operating system and Web browser, many of which run power grids, waterworks, airline reservation systems, retailing networks, military systems and hospitals all over the world. If this A.I. tool were, indeed, to become widely available, it would mean the ability to hack any major infrastructure system — a hard and expensive effort that was once essentially the province only of private-sector experts and intelligence organizations — will be available to every criminal actor, terrorist organization and country, no matter how small. That is why Anthropic is giving carefully controlled versions to key software providers so they can find and fix the vulnerabilities before the bad guys do. In our view, no country in the world can solve this problem alone. The solution — this may shock people — must begin with the two A.I. superpowers, the U.S. and China. It is now urgent that they learn to collaborate to prevent bad actors from gaining access to this next level of cyber capability. Such a powerful tool would threaten them both, leaving them exposed to criminal actors inside their countries and terrorist groups and other adversaries outside. It could easily become a greater threat to each country than the two countries are to each other. Indeed, this is potentially as fundamental and significant a turning point as was the emergence of mutually assured destruction and the need for nuclear nonproliferation. The U.S. and China need to work together to protect themselves, as well as the rest of the world, from humans and autonomous A.I.s using this technology — a lot more than they need to worry about Russia. This is so important and urgent that it should be a top subject on the agenda for the summit between Trump and President Xi Jinping in Beijing next month. “What used to be the province of big countries, big militaries, big companies and big criminal organizations with big budgets — this ability to develop sophisticated cyberhacking operations — could become easily available to small actors,” explained Mundie. “What we are about to see is nothing short of the complete democratization of cyberattack capabilities.” It means that responsible governments, in concert with the companies that build these A.I. tools and software infrastructure, need to do three things urgently: (1)) we need to “carefully control the release of these new superintelligent models and make sure they only go to the most responsible governments and companies.” (2) use the time this buys us to distribute defensive tools to the good actors “so that the software that runs their key infrastructure can have all their flaws found and fixed before hackers inevitably get these tools one way or another.” (By the way, the cost of fixing the vulnerabilities that are sure to be discovered in legacy software systems, like those of telecommunications companies, will be significant. Then multiply that across our whole industrial base.) (3) we need to work with China and all responsible countries to build safe, protected working spaces, within all the key networks, both public and private, into which trusted companies and governments “can move all their critical services — so they will be protected against future hacking attacks.” It will be interesting to see what history remembers most about April 7, 2026 — the postponed U.S. release of bombs over Iran or the carefully controlled release of the Claude Mythos Preview by Anthropic and its technical allies. ]]> Anthropic artificial_intelligence China Claude_Mythos Tom_Friedman cyber_security geopolitics large_language_models national_security step_change vulnerabilities warning_signs bad_news hackers tools critical_infrastructure https://pinboard.in/ https://pinboard.in/u:jerryking/b:fa67eeb590db/ 2026-04-11T16:20:08+00:00 https://archive.is/20260411042914/https://www.ft.com/content/2b6a532b-236f-472b-b386-cc7d30f8453c#selection-1559.0-1940.0 jerryking>geopolitics<< can mostly be ignored when it comes to **asset prices**. Likewise, interest rates, tax regimes, governance and whether your favourite colour is blue or green. Most of this was known to me before I started as a portfolio manager three decades ago. The historical data is unequivocal. Looking back now though, it still amazes me how little the events we were freaking out about at the time actually changed anything. The Asian and Russian crises in the late 1990s barely distracted us from the money we were making in dotcom stocks. The lifts didn’t stop working at midnight on December 31 1999, either. When the crash eventually came, it was over in 24 months. The >>financial crisis<< was even shorter. All but $30bn of the troubled asset relief programme money — some $440bn — has now been paid back. US banks will report bumper profits (and bonuses) next week. Plus ça change. And you can imagine working at Deutsche Bank during the Eurozone debt crisis. Boy did we panic over Greece, Spain, the lack of a fiscal union and the like. It all blew over, didn’t it? Indeed the countries we worried most about are booming now. But it’s not only the Brexits, tariffs and Ukraines that fail to smother returns, as we thought they might. Sky-high valuations don’t seem to bother >>investors<< either. Nor do extreme equity concentrations, autocracies as trading partners, or any of the supposed “megatrends” such as >>demographics<< or >>climate<<. What does make a difference, then? If I’m the moaning child who keeps shaking my head, is there anything over my career that has had a meaningful effect on >>investment returns<>World Trade Organization<< in 2001 — has had a massive impact on economics and finance. Right before it happened, I remember sitting in a Sydney office listening to arguments about why the Australian dollar — commodity-heavy and internet-light — would depreciate forever. Nope! Thanks to easily the biggest consumption of natural resources in history, the country of my birth has been rolling in money ever since. At its peak, China accounted for half the world’s copper, aluminium, cement and iron ore consumption. [i.e. = "commodities supercycle"] Meanwhile, the toys, gadgets or furniture we once looked after so carefully dropped so far in price as to become disposable. The west couldn’t buy enough and was soon racking up massive trade deficits with China. The corresponding savings glut — written about for years by my colleague Martin Wolf — was a major reason for a decades-long fall in global inflation and borrowing costs. Got a bond or credit trader friend with a mansion and Ferrari? Cheers WTO. The second is >>Covid-19<<. Unlike the above, however, in some respects it’s too soon to tell. The worst repercussions are still to come. We know governments took on huge levels of debt during the pandemic. Some vital, much squandered. Few politicians recite the spending numbers today. They are too big to swallow. Some $5tn of Covid relief funding in the US was more than 10 times gross disbursements from the financial crisis. The low single-digit billions spent per day in Iran or on the Artemis II mission are irrelevant in comparison. In many western countries, unsustainable net debt to output ratios would be around a fifth lower if it wasn’t for the pandemic. If >>bond markets<< eventually swoon, the writing of blank cheques during this period will be much to blame. It’s also too soon to tell because post-Covid, voters now demand that governments bail them out of every problem — from oil shocks to expensive student debt. This makes it impossible for politicians to make vital reforms, say to welfare. So yes, two things have mattered over my investment career so far. I’m not sure I have the nerves to handle a third right now. ]]> asset_values China China_rising COVID-19 events financial_crises geopolitics investors what_really_matters WTO bond_market climate_change commodities_supercycle demographics investor_returns U.S.-Israel_War_on_Iran https://pinboard.in/ https://pinboard.in/u:jerryking/b:2086c85ccec8/ 2026-04-09T16:17:22+00:00 https://archive.is/20260408070600/https://www.economist.com/leaders/2026/04/01/how-china-hopes-to-win-from-the-war#selection-1307.1-1310.0 jerryking>Middle East<< by weakening a villainous regime and thwarting its nuclear ambitions. To its most bullish supporters, the war would also change the world by cowing an ascendant >>China<<. It would show how America’s control over the flow of oil leaves China vulnerable. And it would boost deterrence by contrasting America’s military supremacy with China’s reluctance or inability to save its friends. A month into the fighting, this logic still seems misguided and hubristic. Certainly, that is the way it looks from >>Beijing<<. The Economist has been speaking to diplomats, advisers, scholars, experts and current and former officials in China. Almost all of them see the war as a grave American error. China has stood aside, they say, because its leaders understand the maxim attributed to >>Napoleon Bonaparte<<, supposedly uttered as his foes were abandoning high ground at Austerlitz: “Never interrupt your enemy when he is making a mistake.” Many Chinese say the war will accelerate >>America’s decline<<. They see American aggression as a validation of President >>Xi Jinping’s<< focus on security over economic growth. And they expect peace, when it comes, to create opportunities for China to exploit. Only in the background is there anxiety—and the hint of a possible Chinese >>miscalculation<<. First, the view in Beijing is that America is lashing out at Iran because it feels its power ebbing. Like Britain in the 19th century, its formidable display of military force contrasts with its >>lack of purpose<>restraint<<. President Donald Trump has **spurned the advice of experts** [i.e. ="eschewing advice /expertise]. He has issued wild threats and, as this was published, was about to address the nation amid talk of pulling out. His lack of a strategy has set America up for failure. Chinese experts hope the war will amplify talk of decline. Mr Trump’s musings about a ground operation are a sign of how easily one ill-considered step can lead to the next. If Iran falls into chaos or the regime clings on, America may spend years **fighting fires** in the >>Middle East<<. If Iran seeks nuclear weapons, Uncle Sam may go to war yet again. All that would >>distract<< America from >>East Asia<< [i.e. = "pivot to Asia"] where, if China has its way, the >>21st century<< will be shaped. This war will also worry countries that depend on America. Not only has their ally become less reliable, but they are paying for its hot-headedness in expensive energy and raw materials. Will Asian countries therefore become more wary of offending China? Second, Chinese officials think the war shows the wisdom of Mr Xi’s emphasis on fostering >>self-reliance<< in technology and commodities, even when those efforts have come at the expense of economic growth (which remains stubbornly and wastefully below its potential). Mr Xi has strived to protect China from chokepoints being closed. He has created a 1.3bn-barrel **strategic reserve of crude oil**, enough for several months. He has diversified power-generation to nuclear, solar and wind while maintaining the use of domestically mined coal. China is being characteristically pragmatic, by facilitating Iran’s oil trade. Mr Xi has also invested in >>chokepoints<< of his own as a deterrent against America. Last year, after Mr Trump escalated tariffs, he threatened to restrict supplies of >>rare earths<<, vital for electronics and green tech. Although this leverage will fade as America finds alternative sources, Mr Xi is already seeking new pressure points, including vital pharmaceutical molecules, some **chips** and >>logistics<<. He wants China to dominate new technologies, such as >>quantum computing<< and >>robotics<<. Last, the war will create opportunities. The Gulf countries and Iran will tender lucrative >>rebuilding<< contracts. Many countries worried about future embargoes in the >>Strait of Hormuz<< will want to buy Chinese green technology, including gear from >>solar<<, wind and battery producers—all of which have overcapacity. Whereas America blows hot and cold, China’s brand of cynical self-interest is at least dependable. China also thinks it can exploit America. Weakened in Iran, Mr Trump may be easier to negotiate with. At his summit with Mr Xi in Beijing in May, China hopes to lay the ground for a deal that will curb America’s use of tariffs and export controls and possibly create a framework for Chinese investment in America. Ideally for China, Mr Trump will say that America opposes Taiwanese independence and supports peaceful unification—a shift from the studied ambiguity of Henry Kissinger’s original formulation. Yet China’s optimism is tempered by anxiety. Experts are taken aback by how the American armed forces are using artificial intelligence to co-ordinate operations. That is one more reason for dismissing the idea that Mr Xi is impatient to invade Taiwan. As Iran has shown, war is >>unpredictable<<. And if America is declining, war will be unnecessary. Other worries are economic. If war drags on, the harm to China and its exports will mount, even if other countries suffer more. For all China’s hard-headed analysis, it has one strategic >>blind spot<<. Chinese thinkers are too reluctant to contemplate a scenario in which America acts as a rogue power, ripping up the world order it created. Although China likes to complain about >>Western values<<, it has thrived under rules that America has laboured to sustain. An **unstable planet** would be uncomfortable for China. Global >>disorder<< would undermine its export-fuelled growth, a worry for a party whose legitimacy rests on prosperity, iron-fisted order and Chinese exceptionalism. That scenario may well accompany >>America’s decline<<. But not necessarily. Faced with technological and political change, America has repeatedly shown a remarkable ability to **reinvent itself**. By contrast, China is cautious, ageing and hidebound by party ideology. So far, whenever America does not provide global security it has been loth to step in. China is putting a lot of weight on the assumption that America will fail to thrive amid the anarchy it is creating. There is a future in which America embraces upheaval and China shuts itself off. That future may belong to America. ]]> America_in_Decline? China China_rising choke_points east_Asia fire-fighting pivot-to-Asia reinvention self-reliance stockpiles U.S.-Israel_War_on_Iran unstable_world Napoleon_Bonaparte Xi_Jinping Beijing lack_of_purpose lack_of_restraint Middle_East miscalculations 21st._century blind_spots disorder distractions Iran logistics Persian_Gulf quantum_computing rare_earth_metals rebuilding robotics self-reinvention semiconductors solar Strait_of_Hormuz strategic_commodity_reserves unpredictability upheaval Western_values eschewing_advice/expertise https://pinboard.in/ https://pinboard.in/u:jerryking/b:042cc2b604f7/ 2026-04-08T15:17:51+00:00 https://archive.is/20260408070600/https://www.economist.com/leaders/2026/04/01/how-china-hopes-to-win-from-the-war#selection-1255.0-1307.13 jerryking China https://pinboard.in/ https://pinboard.in/u:jerryking/b:aee645a0e06b/ 2026-04-06T12:52:25+00:00 https://archive.is/20260405043821/https://www.washingtonpost.com/national-security/2026/04/04/china-ai-military-intelligence-iran-war/#selection-233.0-371.8 jerryking>People’s Liberation Army<< — marrying >>artificial intelligence<< with >>open-source<< data to market information they claim can “expose” the movements of U.S. forces. >>Beijing<< has sought to distance itself from any direct involvement in the Iran war, but the firms — many of which have emerged in the past five years as part of the government’s push to harness private AI for military use — are capitalizing on the conflict. U.S. officials and intelligence experts are divided over whether Chinese firms’ publicly marketed >>tools<< pose a genuine threat or are being credibly used by U.S. >>adversaries<<, but say the surge in private-sector offerings points to a growing >>security risk<< and reflects >>Beijing’s<< intent to project the strength of its intelligence capabilities. >>Beijing<< has poured hundreds of millions of dollars into supporting >>private firms<< developing >>AI<< with practical defense applications under its civil-military integration strategy, and last month announced plans to supercharge those efforts as part of a broader five-year >>national strategy<<. Private firms have long used >>open-source<< data — including flight trackers, satellite imagery and >>shipping data<< — to generate >>market intelligence<<. But the growing >>AI<< capability of Chinese firms is making these tools more powerful, underscoring the growing challenge of >>concealing<< U.S. >>military movements<< from >>adversaries<<. “The proliferation of more and more capable private sector geospatial analysis companies in China will augment China’s defense capabilities and ability to contest U.S. forces in a crisis,” said Ryan Fedasiuk, a fellow at the American Enterprise Institute think tank. MizarVision, a Hangzhou-based firm founded in 2021, is one of the companies that uses a mix of Western and Chinese data filtered through AI to catalogue activity at U.S. bases in the Middle East, track naval movements and identify the position and number of specific aircraft and missile defense systems. >>Images<< sourced to the firm — which is not part of China’s military but holds a National Military Standard certification required for firms supplying services to the >>People’s Liberation Army<< — and posted on Chinese and Western social media, for example, detailed the buildup of U.S. forces in the Middle East on the eve of the launch of Operation Epic Fury, including the passage of the USS Gerald R. Ford and USS Abraham Lincoln carrier strike groups. It also shared detailed breakdowns of the number and types of aircraft massing at Israel’s Ovda Air Base, Saudi Arabia’s Prince Sultan Air Base and Qatar’s al-Udeid Air Base. “In the lead-up to the escalation of tensions in Iran in 2026, we quickly identified the locations of weapons and equipment deployed in the Middle East,” and “exposed” the **refueling patterns** of U.S. carrier groups, MizarVizion’s website claims. MizarVision does not publicly list its clientele and did not respond to requests for comment. .....an analysis of images posted online and accounts from two users of the company’s platform suggest it draws on a mix of Chinese and Western sources......... Chinese state media has also previously reported that the firm has used imagery from >>Planet Labs<<. Jing’an Technology, another Hangzhou-based firm tracking U.S. military movements in the Middle East, released what it claimed was a recording two U.S. B-2A stealth bombers communicating with each other during the opening salvos of Operation Epic Fury. “In the eyes of AI, there is no absolute ‘stealth,’” “While ordinary people were still debating over social media tweets, [Jing’an] frantically cross-validated massive amounts of ship and flight data in just a few days from the end of January to the beginning of February, locking onto more than 100 U.S. warships, dozens of U.S. military aircraft, and recorded more than 100,000 [military-related] movements,” U.S. officials and former intelligence analysts say they are skeptical that Chinese firms can penetrate U.S. stealth communications, but warn that the rise of such companies is concerning nonetheless. “Even if the capability isn’t there yet … the big picture concern is the intent, “Companies tied to the CCP are turning AI into a battlefield surveillance tool against America. The threat from China’s technology ecosystem isn’t theoretical, it’s imminent. ... The United States cannot allow the Chinese Communist Party to turn commercial technology into **real-time intelligence on American troops**,” the House Select Committee on China said in a statement referencing MizarVision’s work. Analysts say the work of private firms like MizarVision and Jing’an could also offer Beijing a plausible way to aid partners while maintaining official distance from conflicts. ]]> adversaries artificial_intelligence Beijing China China_rising Chinese dual-use geospatial location_data market_intelligence military_movements movement_patterns national_security open_source OSINT pattern-detection PLA Planet_Labs privately_held_companies private_sector satellites security_&_intelligence security_risks surveillance tools tracking troop_movements U.S.-Israel_War_on_Iran military_assets digital_footprints imagery national_strategies classified_information detection concealment data_sleuths shipping_data https://pinboard.in/ https://pinboard.in/u:jerryking/b:03b3c94d4425/ 2026-03-27T07:53:07+00:00 https://archive.is/20260325181929/https://www.economist.com/finance-and-economics/2026/03/24/chinas-new-masterplan-for-its-tech-economy-in-2030-and-beyond#selection-1319.1-1322.0 jerryking China industrial_policies state-directed https://pinboard.in/ https://pinboard.in/u:jerryking/b:755602e4c866/ 2026-03-26T13:05:32+00:00 https://archive.is/20260324231521/https://www.economist.com/china/2026/03/24/chinas-government-both-drives-and-constrains-the-rise-of-ai#selection-1303.1-1303.14 jerryking artificial_intelligence China hands-on industrial_policies state-directed https://pinboard.in/ https://pinboard.in/u:jerryking/b:d71a29cd6a07/ 2026-03-20T16:10:36+00:00 https://archive.is/mFc7g#selection-1547.0-1929.14 jerryking agentic_AI China https://pinboard.in/ https://pinboard.in/u:jerryking/b:1069f70a2272/ 2026-02-16T22:14:38+00:00 https://www.wsj.com/opinion/america-needs-ai-that-can-do-math-392b223b?mod=hp_opin_pos_4 jerryking>biotechnology<<, as an example, and China is now rising quickly in novel biopharma IP and clinical trials, often outpacing Western rivals. This new plan, the 15th under Communist Party rule, will continue with a focus on AI and quantum technology and double down on other key areas in the >>physical world<<. In particular, the plan will focus on novel material science, which will build on China’s dominance in critical minerals. Novel materials include new metal alloys as well carbon-based materials that can be stronger and lighter than traditional materials such as steel. Novel material science also includes de novo chemical combinations for batteries that can store more energy with faster charge cycles and lighter weight. Applications include hypersonic missiles, advanced chip manufacturing, military ships and batteries for energy storage. AI models trained on social media and Pinterest images are poorly suited for these applications, which need subatomic-level physics. We need new AI models for the real world—quantitative models trained on lab data and equation-based outputs that let them leapfrog current technology. >>Hallucinations<< aren’t an option for mission-critical applications. The country that has the best quantitative AI models and quantum technology will dominate the rest of this century. The Chinese know this and are focused accordingly. Areas of real-world AI include pharma, semiconductors, energy and financial services—four sectors that represent more than $25 trillion of global economic output and that thrive on numbers and equations, not language. The AI with which American users are familiar is >>large language models<<, which can pump out text, songs, images, videos and other digital media. AI for the quantitative world is something else entirely, focusing on creating novel medical treatments, de novo material science, and advanced risk management and portfolio construction. The fields of robotics and autonomous driving are also moving quickly and need quantitative models that help these platforms navigate the world. Ilya Sutskever has recently been adding his voice to the “beyond LLM” camp, stating that we won’t reach >>artificial general intelligence<< with language models alone. Gary Marcus has been heralding this theme for years, now in good company. World Labs and AMI are two new companies focused on these quantitative models. There is consensus in the AI world that the model builders have vacuumed in almost all possible data that one can find accessible online. **New data that will change the course of AI models won’t come from the Web, but from novel sources** that are >>sector-specific<<. For the development of new medical treatments, we >>need data sets<< created from automated labs that **run thousands of experiments**.[i.e. = "high-throughput experimentation"] These robotic labs are emerging in the West and in China. The lab output is then augmented with >>synthetic data<< based on the equations of physics and chemistry to expand the data sets further. These data sets are then used to train proprietary models with novel architectures that are adapted to the sector employing them. The need for new models is especially acute in defense and energy. China is outpacing the U.S. in developing hypersonic missiles. These missiles travel at Mach 5 or faster and are much more difficult to track and shoot down than conventional versions. Novel materials help make these missiles lightweight and strong. China also controls the battery market, with 92% share of battery-grade lithium and 85% of the market. To compete, we have to move beyond lithium-based batteries to novel chemistries. Similarly, new materials and processes are needed for advanced chip manufacturing. As chips pack in more transistors, we are approaching physical barriers. Novel materials and designs are needed to keep Moore’s Law progressing. Quantitative AI models are needed to design these new materials and topologies for chips. There are many possible combinations of elements to make these materials [i.e. = "combinatorial innovation"] , only a few dozen of which might be viable to take to scale. Computing the optimal mix of elements is a task far beyond traditional tools. Computing risk and optimization in financial services is also critical to our economy. The complexity of fast-changing markets and trading strategies is outstripping the capabilities of traditional risk tools. In the world of insurance, for instance, the same risk models have been used for decades, but they don’t capture the temporal and high-dimensional resolution needed for this market. Insurance companies are flying blind when they want to compute the blended risk of taking on additional pools of policies from other brokers. In asset management, a crisis is growing as managers gain more assets, now often in the trillions. The size and scale of these managers means that small movements on their part can move the entire market. More complex structured instruments as well as increased leverage in the private markets that are now available mean that the real-world footprint of many assets are many times their notional value. Language models aren’t appropriate tools for these critical tasks, and the viability of our financial markets depends on getting this right. China is intent on dominating key sectors of the global economy and has proved it can do so in areas such as critical materials. The laser focus in its new five-year plan puts the U.S. and its allies on notice that we will have to leapfrog with AI for the real world if the West is to edge out China.]]> artificial_intelligence China rivalries U.S. quantum_computing AGI biotechnology combinatorial_innovation datasets large_language_models national_strategies new_information physical_world sector-specific synthetic_data high-throughput_experimentation data_needed-needed_data new_data_sources industrial_policies physical_AI AI_hallucinations https://pinboard.in/ https://pinboard.in/u:jerryking/b:73e149236165/ 2026-02-14T01:59:39+00:00 https://archive.is/0PLa6#selection-1547.0-1561.14 jerryking>foreign-born<< researchers and entrepreneurs have returned home and have had a huge impact on developing the tech industries in their native countries. Perhaps the most notorious returnee was Qian Xuesen, the Hangzhou-born Caltech professor who was deported from the US in 1955 during the anti-communist hysteria of the Red Scare. On returning to China, Qian masterminded the Dongfeng ballistic missile programme, becoming the “father of Chinese rocketry”. In the 1980s, the Taiwanese poached the Chinese-born electrical engineer Morris Chang from the US to help develop the country’s semiconductor industry. Chang founded TSMC, which has become the world’s leading chip manufacturer. This century, many thousands of Chinese-born researchers and entrepreneurs have been encouraged to return home armed with US credentials, contacts and start-up playbooks. One of the most successful of these sea turtles, as they are called, is Robin Li, co-founder of the multinational technology giant Baidu. A similar pattern has been observable in India, albeit to a lesser degree. But, intriguingly, the success of these so-called boomerang entrepreneurs now appears to be falling short. New research on 596 high-tech start-ups founded in India between 2016 and 2023 reveals that those created by purely domestic teams outperformed those launched by returnee entrepreneurs in terms of funding, valuation and revenue. “The results are largely unexpected,” the report’s four authors candidly conclude. India’s homegrown heroes are now outpacing India’s prodigal sons, as the authors put it. The currency of time spent at Stanford University or Google in the US has been devalued. The explanations for this reversal are not definitive. But the supposition is that it is because networks are increasingly digital, venture capital funding is now global and tech skills are more easily transferable. India’s domestic tech ecosystem has now matured sufficiently to enable local founders, embedded in domestic markets, institutions and networks, to flourish without returnee expertise, write Vivek Wadhwa, AnnaLee Saxenian, DPK Muthukumaraswamy and MH Bala Subrahmanya. The liability of localness has flipped into the liability of foreignness. The report’s findings are somewhat galling for Wadhwa for two reasons. First, they contradict some of his earlier research on the advantages of “brain circulation” he conducted as a US academic with Saxenian, a professor at the University of California, Berkeley. Second, the Delhi-born Wadhwa is himself a boomerang entrepreneur, having returned to India to build a biotech start-up, Vionix Biosciences. “The locals do better than we do,” jokes Wadhwa. “When it comes to core entrepreneurship, the foreign advantage doesn’t exist.” If these research findings are matched in other countries — and Wadhwa strongly suspects they would be — then this may have big implications for investors and policymakers around the world. Most importantly, it means countries should do everything they can to retain their best homegrown entrepreneurs. This is especially true in India, which has the world’s largest diaspora of 35mn people, many of them boasting Stem qualifications. The other big factor is clearly that the US has become a lot less welcoming to foreign workers. If the best foreign entrepreneurs conclude they are better off staying at home anyway, the exorbitant privilege of the US brain gain will fade. ]]> brain_circulation brain_gain China country_of_origin ethnic_communities emigration exorbitant_privilege founders heritage_migration homegrown immigrants India Jensen_Huang John_Thornhill outmigration return_migration Silicon_Valley TSMC U.S. Vivek_Wadhwa Andy_Grove foreign-born https://pinboard.in/ https://pinboard.in/u:jerryking/b:1a93b2cef7b6/ 2026-02-11T07:30:56+00:00 https://www.nytimes.com/2026/02/10/opinion/china-ai-ev-trump.html jerryking>industrial robots<< as the United States.) After a visit, Ford’s chief executive, Jim Farley, last summer pronounced China’s in-vehicle technology “far superior” to American models’ and described Chinese progress as “the most humbling thing I’ve ever seen.” Coincidentally — or not — Ford recently stopped production of its F-150 electric truck and took a huge $19.5 billion write-down on its **electric vehicle** efforts. Then there’s >>drug development<<. Just a few years ago, China was still licensing many of its >>pharmaceuticals<< from companies overseas. Now it licenses more drugs to other countries than it licenses from them, and it has surpassed the United States in its number of >>clinical trials<<. Of course, China still faces challenges. The consequences of a still deflating property bubble continue to ripple. Partly as a result, consumers have yet to open their wallets. With slowing growth, youth unemployment surged to nearly 20 percent (and has backed off only slightly). Investment has fallen. That adds up to the fact that there are two Chinese economies: a sluggish domestic economy and the colossus that dominates global manufacturing while making extraordinary progress in fast-growing, technology-oriented fields that have long been American led. China has achieved this success in part via its model of >>state-directed<< capitalism. When the government realized it was losing the A.I. race, it made clear that catching up was a national priority and backed that up with money, regulatory relief and the development of huge amounts of electricity-generating capacity. We can see the results. Competing against China will be difficult under the best of circumstances. Clearly we need to rethink our >>industrial policy<< — the way we can deploy our government resources to support strategically important industries, which is our version of >>state-directed<< capitalism. Unfortunately, the Trump administration’s incoherent policies are creating a truly bad set of circumstances. For starters, we need to reverse the cuts that Mr. Trump has made to investments in science and other areas. And while I’m plenty skeptical about the ability of a democratic government to pick winners, we no longer have the luxury of confining Washington to the sidelines. In particular, we should focus on industries of the future, many of them technology related, and tone down Mr. Trump’s emphasis on traditional metal-bending manufacturing. For example, thanks to the CHIPS and Science Act passed under President Joe Biden, huge >>semiconductor<< fabs are under construction in Arizona and elsewhere. Redirecting government goes beyond spending. We lack >>critical minerals<< not because they are rare but because securing permits for new mines and processing facilities is so difficult. We can surely find a way to develop our >>mining<< capabilities without compromising reasonable environmental standards. What Mr. Trump should learn — as should everyone else — is that we are not going to beat China by imposing >>tariffs<< or by attempting to negotiate trade agreements that China would probably violate. (Importantly, sound industrial policy does not mean taking stakes in companies or demanding royalties, as the Trump administration has been doing.) Outpacing China has to begin at home, by >>getting our own economic house in order<<, a challenge that also should motivate Mr. Trump to rethink a large range of his policies. ]]> artificial_intelligence China China_rising getting_our_house_in_order industrial_policies Steven_Rattner U.S.-China_relations industrial_robots capitalism clinical_trials critical_minerals drug_development electric_cars mining people-less pharmaceutical_industry semiconductors state-directed tariffs https://pinboard.in/ https://pinboard.in/u:jerryking/b:52c48e05abb7/ 2026-02-10T22:39:25+00:00 https://archive.is/gO5jW#selection-1909.0-1919.9 jerryking Arctic China Donald_Trump Greenland strategic_geography https://pinboard.in/ https://pinboard.in/u:jerryking/b:0f466160f8ab/ 2026-02-06T20:48:23+00:00 https://www.wsj.com/world/china/us-china-decouple-economy-minerals-tech-602fdee6?mod=hp_lead_pos7 jerryking China de-coupling de-risking https://pinboard.in/ https://pinboard.in/u:jerryking/b:e42e2071c6a3/ 2026-01-26T00:53:41+00:00 https://www.wsj.com/world/china/china-ai-weapons-hawks-wolves-2fcb58bb?mod=hp_lead_pos8 jerryking Beijing China China_rising drones swarm_intelligence warfare animal_behavior https://pinboard.in/ https://pinboard.in/u:jerryking/b:066292f239e1/ 2026-01-25T18:52:20+00:00 https://www.washingtonpost.com/opinions/2026/01/23/trump-davos-threats-allies-cost/ jerryking>transactional<<. He begins by asking, “Who has more >>leverage<>dominate<< — extracting the maximum price.[i.e. = "mercenary motives"] For him, >>diplomacy<< is the >>art of the squeeze<<. Trump enjoys using America’s vast strength — built over generations — almost for sport. He placed >>tariffs<< on Switzerland, and then raised them sky high because the Swiss president, he said, “rubbed [him] the wrong way.” He relished recounting how quickly the Swiss came to him seeking relief. This was less strategy than a >>power play<<. Last year, NATO Secretary General Mark Rutte appeared to jokingly liken Trump to a “daddy” intervening in a schoolyard brawl, and Trump has repeated that line with evident pleasure, including at >>Davos<<. He seems to enjoy even insincere flattery because it shows that he is so powerful, people have to fake their admiration for him. The Europeans should not take it personally. Trump uses the same style on anyone he perceives as weak. In Ukraine, his irritation has often fallen less on Russia — the aggressor — than on Ukraine, for refusing to accept subordinate status. In dealing with countries like Brazil or South Africa, he is quick to lash out over policies he dislikes. But with China, he often sounds oddly deferential — because Beijing possesses tools that could **impose real costs** on the United States. And he adores the **Gulf monarchies** because they are swimming in cash, a form of strength he respects. This is the opposite of how American leadership has worked in the modern era. The United States has been the world’s dominant power for close to a century. But its leaders understood that primacy is not only about coercion; it is also about >>legitimacy<<, reassurance and voluntary cooperation. They grasped a basic truth: Power is more sustainable when it is exercised with restraint [i.e.= "second-level thinking"], and influence is larger when allies feel dignity rather than fear. Think of President >>Franklin D. Roosevelt<<. America was the indispensable arsenal for the Allied cause; without American aid, Britain and the Soviet Union would have lost the war — and fast. Roosevelt could have summoned Churchill and Stalin to Washington like petitioners. Instead, despite using a wheelchair and gravely ill, he traveled for hours and hours to the Casablanca, Tehran and Yalta conferences to meet them as equals — demonstrating, in physical form, the idea that >>partnership<< matters. Trump crowed more at Davos about winning World War II than did the man who actually did the winning. Or consider >>George H.W. Bush<< watching the Berlin Wall fall. The United States had “won” the Cold War, and Bush could have crowed. He deliberately did not. He said he did not want to “dance on the wall” — in part because he did not want to steal the moment from Eastern Europeans who were winning their freedom, and in part because he did not want to >>humiliate<< Soviet leader >>Mikhail Gorbachev<<, who was allowing it to happen. Or consider India. Over the last quarter-century, the United States treated India as an important world player, even when it was still by the numbers a very poor country. That respect was not charity; it was an investment that helped build strategic cooperation. Trump sees only the balance sheet: India’s economy is smaller than America’s, therefore America can squeeze it by slapping prohibitively high tariffs on it. This is the art of the hustle: Use the leverage you have, make the other side pay the highest price and treat bruises as proof of success. It may work in a one-off real estate deal. It is not how to build enduring businesses, let alone lasting global influence. Since World War II, there have been many places that the U.S. has considered strategically vital — Western Europe, Norway and Finland, the South China Sea routes, the Persian Gulf, the approaches to Japan. But in that time America has never concluded that strategic importance requires physical annexation. It has created security through >>alliances<<, access agreements and forward presence. Greenland fits that tradition. The United States already has a base there, and it can expand its capabilities easily through cooperation rather than coercion. Whether or not Trump gets his “piece of ice” (as he now calls Greenland), he has already accomplished something that will outlast the headlines: He has taught America’s allies a lesson. They will still work with Washington — because power is real. But they will trust it less, hedge more and quietly plan for a world in which America no longer leads by lifting others up, but by reminding them they can be squeezed. As that European leader put it, with the same cold clarity Trump thought belonged only to him: We will remember. ]]> Davos diplomacy Donald_Trump EU Europe Greenland strongmen threats undermining_of_trust alliances apply_pressure bargaining_power Beijing China Cold_War FDR humiliation legitimacy leverage Mikhail_Gorbachev partnerships power_plays tariffs transactional_relationships Fareed_Zakaria George_H_W_Bush domination Gulf_states imposing_costs mercenary_motives art_of_the_squeeze https://pinboard.in/ https://pinboard.in/u:jerryking/b:2439e65ad54d/ 2026-01-18T15:59:29+00:00 https://en.wikipedia.org/wiki/Salt_Typhoon jerryking China cyberattacks cyber_security MSS Wikipedia espionage hackers security_&_intelligence telecommunications Salt_Typhoon https://pinboard.in/ https://pinboard.in/u:jerryking/b:ed4cf7371620/ 2026-01-16T19:22:26+00:00 https://www.theglobeandmail.com/opinion/article-in-seeking-to-deepen-trade-with-china-canada-is-hedging-its-bets/ jerryking>existential<< dilemma: the backdrop to the Prime Minister’s trade mission to China this week. The trip has occasioned a number of alarmist pieces in the right-wing press, warning against a "pivot" to China and bristling at the implied premise, that the United States is no longer a reliable trading partner or democratic ally. Whatever one may think of the current administration, the argument runs, the United States does not represent anything like the same threat to our interest, our values, or our >>sovereignty<< as China. Leave the latter point to one side, for the moment. Is anyone actually proposing that we should pivot to China – that we should turn away from trading with the United States, our nearest neighbour and largest trading partner by far, and instead go all in on trade with China? Not even the Liberals have suggested this – not at their most delirious stage of infatuation, in the first days of the Trudeau government, and certainly not now. The proposition, as I understand it, is not either/or – either we trade with the United States or we trade with China – but both/and. Or perhaps, neither/nor: We should neither be overly dependent on the United States nor on China, but should >>hedge<< our bets between them. That’s not to suggest any moral equivalency between the two, but it is to recognize that both have the potential to threaten our interests, using trade as a weapon. Trading more with China is in our interest, so far as it reduces our dependence on the United States – and so long as it does not make us overly dependent on China. We have had to rethink our approach to trade with China before: The first flush of enthusiasm, in the wake of Deng Xiaoping’s reforms, that trade with China might not only make us rich, but make China more liberal, gave way over time to the realization – crystallized in the >>Two Michaels<< affair but evident long before – that, far from luring China into the community of civilized nations, trade was being used to bend us into a shape more to China’s liking. So we recoiled. Relations froze. A revised federal security policy described China as a "an increasingly disruptive global power," a marked contrast with previous official language, which was all about "deepening mutual understanding" with China as a "strategic partner." A public inquiry into foreign interference in Canadian elections named China as the principal actor. All well and good. We cannot pretend to have warm relations with a country that kidnaps our citizens, messes with our elections and intimidates members of the diaspora – to say nothing of its bestial treatment of its own people, or its aggressive designs on its neighbours. But then Donald Trump returned to the White House, and having returned, began issuing a series of threats, not only to our trading relationship – the odds of a successful renegotiation of the current continental trade deal must be rated as iffy at best – but our very >>sovereignty<<. And so we have had to recalibrate once more: Not because China has become any less dangerous, but because the U.S. has become more so. This does not mean a return to the last decade, where there was even talk of Canada and China signing a free-trade agreement. But a cautious reopening, with appropriate "guardrails" – one that walls off security-sensitive industries and assets; one that does not seek more from China, in the form of market access, than we would be prepared to sacrifice, should the need arise; one that leaves us free to take an independent line on questions of human rights and international security – does not seem out of place. The point is not that all is forgiven. Neither should we be under any illusions about China’s intentions. Concessions on our part may not result in reciprocal concessions on theirs, but may simply be used to extract further concessions. Even if, for example, a reduction in Canadian electric-vehicle tariffs secured a reduction in Chinese canola tariffs, who’s to say that China would not reimpose the tariffs at some future date, when there was no more Canadian EV industry to protect? Likewise, we will have to guard against the ever-present temptation to go along to get along. The curtailment of a trip to Taiwan by two Liberal MPs is troubling, but might perhaps be excused in terms of timing, coinciding as it did with the Prime Minister’s trip to Beijing. But what is the excuse for the delay in establishing the long-promised foreign agent registry? All of which is to say: Sailing the trade and security seas of the 21st century is a much more complex task than it was in the past. It was easy to separate trade and security concerns in the Cold War: Who wanted to buy anything from the Soviet Union? But in today’s world our adversaries are also our trading partners – and our trading partners may become our adversaries. Still, to the extent that trade and national security conflict, the latter must take precedence. To depend on trade with the United States to the degree we have until now might have made economic sense, once; it might still do so. But it is inimical, as we must surely now realize, to our >>national security<<. That national security now obliges us to deal with odious regimes like China’s is an unpleasant consequence of the world Mr. Trump has made. But such is the >>ruthless<< pragmatism our current predicament requires. For make no mistake, a predicament we are now in. Not only are we whipsawed between the United States and China, but wedged, geographically, between the United States and Russia: formerly antagonists, but under their current leaders increasingly aligned and increasingly alike; aggressive, expansionist powers, that menace their neighbours and repress their own citizens. Again, you don’t have to claim equivalence to see a certain convergence. If you doubt the United States has become a potential adversary, have a look at what is going on in Greenland. I have seen it suggested that the idea that the U.S. might forcibly annex Greenland is pure fantasy, a figment of the media’s imagination. I don’t know: It seems real enough to the Danes. It’s real enough to the top U.S. military brass, who are under pressure from Mr. Trump to draw up invasion plans. It’s real enough to France, Germany, Sweden and the Netherlands, among others, who have all rushed troops there to prevent it. It’s real enough to the U.S. Senators who have hurriedly drafted legislation to forbid it. And it’s real enough to Mr. Trump, who keeps insisting it is an option. Suppose he does what he usually does, and opts for the most insane, self-destructive choice available to him. The consequences of such a monstrous betrayal – the United States invading a NATO ally – are incalculable. At a minimum, it would mean the death of NATO, as a transatlantic alliance. The U.S. would find its military bases in Europe expelled, its arms sales ended, its air and sea access denied, as well as whatever trade and economic sanctions the Europeans saw fit to impose. At worst, it could mean a shooting war. Oh, I forgot to mention: To the list of countries sending troops to Greenland add (perhaps: They’re thinking about it) Canada. Here is where we are at: The most probable current source of an attack on NATO territory is not Russia or China but the United States. And the country in the second-most trouble in that event, after >>Denmark<<, is Canada. The risk, even then, is not invasion: An attack on Canada is orders of magnitude more insane than an attack on >>Greenland<<, which is orders of magnitude more insane than the attack on Venezuela, which was insane enough to begin with. The risk, rather, is >>vassalization<< – Finlandization, as it was called during the Cold War: subordination to the dictates of the neighbouring superpower, even as we retain our nominal independence. We talk of diversifying our trade to China and other countries, to lessen our dependence on the U.S. But what if the U.S. objects to this attempt to evade their grasp? We talk about refusing to buy U.S. military hardware. But what if the U.S. insists that we must? We talk about using our >>natural resources<<, especially our >>critical minerals<<, as bargaining chips. But what if the U.S. demands we just hand them over? The United States has a great many tools at its disposal, short of military invasion, to enforce compliance. It could make life pretty miserable for us, if it chose. The reason it did not do so in the past is because it had normal governments with a normal sense of limits and a normal awareness of the benefits of co-operation, rather than coercion, in the affairs of states. That, and because most of the instruments with which they might punish us for disobedience, in the form of trade restrictions, would also punish their own citizens – who would ultimately punish the government that imposed them. Even if we could not always count on the goodwill or good sense of an administration, we could ordinarily depend on their sense of self-preservation. But Mr. Trump seems unusually unperturbed by such considerations. He is in the low-40s in the public-approval ratings. His party is six to eight points behind the Democrats. As things stand, he and they are headed for a massive defeat in the midterm elections this fall. And yet he continues to do all of the same things that brought them to their current pass. It is almost as if he doesn’t care what happens in the election. Or as if he does not intend to allow it. At any rate, that is the world we are now in: A world of predatory >>great powers<<, unrestrained either by international law or democratic politics. For a >>middle power<<, navigating all this is going to take exquisite >>statecraft<<. In the short term, it will require maintaining tolerable relations with the United States, while bridging to other export markets; keeping NATO running as long as possible, even as we are constructing new alliances; **striking the right balance**, between defiance and co-operation, with all of the >>great powers<<, at the same time as we are taking steps to improve our **bargaining position**. In the longer term, in the mounting chaos of the coming decades, the conclusion seems inescapable: Our interests – our unity, our territory, our way of life – will only be secured by becoming a >>great power<< ourselves.]]> Andrew_Coyne Canada China subjugation superpowers critical_minerals Denmark double_betting existential great_powers Greenland hedging middle-powers national_security NATO natural_resources predatory_practices ruthlessness sovereignty statecraft striking_a_balance Two_Michaels U.S. vassalization bargaining_power https://pinboard.in/ https://pinboard.in/u:jerryking/b:671c717463a9/ 2026-01-13T16:28:54+00:00 https://www.ft.com/content/331ec18b-9960-4954-8728-f2ff5bb5ee7b?accessToken=zwAGSEgS5zdgkc8zHsGLmWBJVNOHKPL_W7Xuew.MEUCIQCQHuzdbMDL51gas_jnidh2x5Jo_0BvQS37hio-mh9kgAIgGmIr7nx97VKsVrhiRSRmrFfltLm362O4BeQpG7yzrJ4&sharetype=gift&token=e8f75f67-9afe-4af3-a83d-4e4eb33ab564 jerryking>global public goods<<, including stability. As world leaders converge on Davos, most of the chatter is about coping with Trump, who is bringing half his cabinet. A quieter China will be there to pick up the pieces. In that respect, today is zero sum. A loss to America is a gain for China. Countries in America’s hemisphere, including Canada, are moving closer to Beijing. Mark Carney, Canada’s prime minister, is stopping in China before heading to Davos. As goes Carney’s itinerary, so goes global diplomacy. Countries are >>de-risking<< in two main areas. The first is economic. Carney is again out front. Almost three-quarters of Canada’s exports go to the US, a number they aim to reduce to below 50%. A lot will divert to China and India. Europe’s conclusion last week of a free trade deal with Mercosur (Argentina, Brazil, Uruguay and Paraguay), and the UK’s deal last year with India are Trump’s co-creations. Britain’s debate about putting Brexit behind it and moving closer to the EU also comes partly courtesy of Trump. He is spurring all kinds of third-party conversations that were not happening a year ago. Europe wants partnership with the Trans-Pacific group. That China is not a member, but wants to join, while the US pulled out in Trump’s first term, says it all.   It is far harder to diversify from the US dollar. But Trump’s now open assault on Fed independence — including launching a criminal probe into its chair — is pushing that case too. Regardless of whether Powell stands trial (and, less likely still, is convicted), investors can expect an era of rising US inflation and a falling dollar. Whichever “Kevin” replaces Powell will be Trump’s patsy. America’s era of easy money will probably outlive the AI boom. The price of gold — history’s best hedge against war and pestilence — has risen by over 70% since Trump took office last year. Gold is also taking up a growing share of global central bank reserves at the expense of the dollar. So far none of America’s investors have threatened a buying strike on US Treasury bonds. Trump appears to overlook that the markets are at least as important as the Fed in setting borrowing costs. Big foreign withdrawals could quickly wipe out the easy money gains of short-term interest rate cuts. Dumping Treasuries is the financial version of the nuclear option. The actual nuclear option also looms in >>geostrategic<< hedging. It has not escaped the notice of America’s adversaries that Trump speaks nicely about nuclear North Korea. Were Venezuela a nuclear state, Nicolás Maduro would not now be sitting in a Brooklyn jail. South Korea, Germany, Australia, Poland and even Canada are all debating to one degree or another whether to go nuclear. Were Trump to annex Greenland, Canada would weigh it seriously. The disabling of Nato would trigger a broader rest-of-the-west hunt for new security. Denmark now sees the upside of some kind of European **nuclear umbrella**. There is no historic precedent of a dominant power voluntarily abandoning its leadership, as opposed to being defeated in war or by natural decline. Complying with a revisionist titan’s increasingly random demands **imposes an opportunity cost** on building alternative systems. America’s allies are now at that hinge point between the past and the future. Trump is making their choice easier. Raising the price of US protection is one thing — and a reasonable one. But no sane customer would pay more for a product they are not sure will be delivered. Contrary to the mafia analogies, Trump is offering America’s partners a deal they cannot accept.  ]]> America_in_Decline? Canada de-risking Donald_Trump Edward_Luce China decoupling greenbacks Mercosur NATO nuclear_deterrence reserve_currencies superpowers TPP U.S._Treasury_Bonds hegemony Davos geostrategic global_public_goods imposing_costs liberal_order security_umbrella https://pinboard.in/ https://pinboard.in/u:jerryking/b:c373e54dd401/ 2026-01-01T22:12:54+00:00 https://www.theglobeandmail.com/opinion/article-in-the-roiling-cold-war-for-ai-supremacy-the-us-has-let-china-back-in/#comments jerryking>geopolitical<< >>rivalry<<. A few years ago, the United States appeared to be comfortably in the lead. Globally, the United States had the best >>computing power<< with the most sophisticated chips, further complemented by pioneering infrastructure with the highest number of >>data centres<<, which are used to store and compute enormous volumes of data. The U.S. could also flex its expansive geopolitical muscles by pressing allies like Taiwan to restrict exports of the world’s best high-performance chips needed to power advanced AI, and by pushing both Japan and the Netherlands to restrict the export of the lithographic instruments needed to fabricate these indispensable chips. It all went toward developing innovative closed-weight, **frontier >>large language models<< ** like ChatGPT. Ironically, however, these American manoeuvres left China to leverage its behemoth state powers, supplying its tech giants with significant energy and other subsidies to catch up. Chinese firms have accelerated their production of **cheaper** and more agile chips and, most remarkably, with far less direct financial investment. In late 2024, China also succeeded in releasing several sophisticated **open-weight** models such as >>Deepseek<< -R1. These models were transparent, downloadable and flexible, making them easier for companies to customize, experiment and innovate upon. Better yet, these AI models also required much less >>computing power<<, and thus much less energy, than America’s, which are dependent on resource-hungry >>data centres<<. Despite China’s >>breakthroughs<<, the U.S. was charting a path toward AI dominance with more advanced AI patents and by American tech giants’ wide diffusion of AI. But >>Donald Trump<< may have impeded, if not reversed, one other key comparative AI advantage for the U.S.: Its ability to attract and retain the world’s best researchers. AI has three principal inputs – diversity of data or information on the digital highway, faster and smaller chips made of >>critical minerals<< that provide the >>computing power<< to train and scale AI systems, and the development of AI talent – and America’s long-standing advantage was its welcoming environment for the world’s brightest. 70% of the U.S.’s 217 most-published, most-cited and most-impactful AI researchers were born or educated elsewhere. An estimated 66% of Silicon Valley’s tech workers more broadly are born outside the United States, too, compared to the national average of 14%. Moreover, the Massachusetts Institute of Technology – the world’s best university for data science and AI studies, according to the QS World Subject Rankings – reports that half the members of its faculty were born outside of the United States. The United States has married this international >>brain gain<< with the best-equipped labs in its universities and industry, significant government and private-sector research funding, and both Silicon Valley’s “move fast and break things” ethos and the American academy’s freedom to expand the frontiers of knowledge. This has been the recipe for America’s stellar AI innovation and commercialization. However, Mr. Trump’s thirst for domestic ideological control over American universities and his claims that this would clamp down on so-called “identity politics” are shifting the playing field. New federal diktats on permissible teaching subjects, as well as deep cuts to federal research funds by nearly US$7-billion in 2025, are all undermining the U.S.’s academic centres of excellence. The Trump administration also recently announced restrictive and costly changes to acquiring an H-1B visa, which is commonly used to bring in highly skilled migrants with specialized technology abilities. Unsurprisingly, most of the visas issued were sponsored by Silicon Valley companies or by universities hoping to attract tenure-track professors to become international stars. The White House’s crackdown on the academy and its punitive, civil-rights-eroding immigration policies – which disproportionately impact ethnic minorities and immigrants living in the United States, regardless of their status – will rapidly curtail America’s AI dominance. For many, the United States is no longer a “shining city upon a hill.” Today, America finds itself at an inflection point where technological developments are being undermined by politics. In that context, Canada’s 2025 federal budget pledge to spend US$1.7-billion to try to attract 1,000 “world-class researchers” over 13 years was smart and strategic policy-making. And as this high-stakes race begins to narrow, let this be a reminder to all that human intelligence is still by far the most vital component to artificial intelligence’s trajectory. ]]> artificial_intelligence Bessma_Momani China critical_minerals export_controls geopolitics new_tech_Cold_War rivalries semiconductors U.S. alliances brainpower breakthroughs cheap_revolution computing_power DeepSeek Donald_Trump high-performance Japan large_language_models Netherlands open_source researchers state-as-facilitator state-directed state-meddling Taiwan talent brain_gain data_centers frontier_models open-weight https://pinboard.in/ https://pinboard.in/u:jerryking/b:4d1391ed0177/ 2025-12-30T20:13:21+00:00 https://www.nytimes.com/2025/12/30/climate/solar-south-africa-china.html jerryking Africa Cape_Town cheap_revolution China China_rising energy solar South_Africa transformational U.S. cleantech green renewable https://pinboard.in/ https://pinboard.in/u:jerryking/b:3f8d3e822231/ 2025-12-27T02:11:49+00:00 https://www.wsj.com/world/europe/is-the-west-over-d706607d?mod=wknd_pos1 jerryking alliances China EU Europe geopolitics NATO Russia Trump_2.0 Trumpism U.S. Western_values https://pinboard.in/ https://pinboard.in/u:jerryking/b:65ab3a33529c/ 2025-12-01T23:32:05+00:00 https://www.wsj.com/opinion/can-the-u-s-trust-ai-with-national-security-b481ac43?mod=WTRN_pos7 jerryking>Defense Advanced Research Projects Agency<< has already set a goal to achieve military-grade AI, and the Pentagon is already spending hundreds of millions on **frontier capabilities**. Those contracts should mandate that computing resources go toward interpretability, verified shutdown protocols, the elimination of sleeper agents and long-term objective stability. This approach would motivate private-sector research while ensuring that the systems we deploy meet defense-grade security standards. Third, build special zones for AI research on federal land with alignment requirements built in from the start. The Pentagon already demands the best equipment, training and strategic doctrine. It should demand the same from AI systems: reliably steerable toward American strategic objectives across time horizons that matter. America built the atomic bomb when the physics seemed impossible. We reached the moon when the engineering seemed fantastical. We created the internet when networked computing seemed impractical. Americans have always risen to **civilizational challenges** when we’ve seen them clearly and moved with conviction. The challenge now is to build AI systems we can trust with the future. That future is closer than most realize, and the window for shaping it is open. But it won’t stay open forever. ]]> AI_alignment alignment artificial_intelligence China creators’_purposes DARPA high-stakes Judd_Rosenblatt national_security security_&_intelligence rogue_AI civilizational_dangers hope_is_not_a_strategy Pentagon unthinkable circumstance-specific implants undetected under_what_conditions frontier_models https://pinboard.in/ https://pinboard.in/u:jerryking/b:9207acf9d903/ 2025-11-25T05:36:52+00:00 https://www.wsj.com/tech/ai/ai-robots-china-manufacturing-89ae1b42?mod=hp_lead_pos7 jerryking artificial_intelligence automation China China_rising dark_factories manufacturers people-less ports robotics tariffs https://pinboard.in/ https://pinboard.in/u:jerryking/b:e5bb726390aa/ 2025-11-14T07:08:11+00:00 https://www.theglobeandmail.com/politics/article-csis-china-russia-warning/ jerryking Canada China CSIS Russia spymasters https://pinboard.in/ https://pinboard.in/u:jerryking/b:a7d0f169f6a1/ 2025-11-13T14:43:16+00:00 https://archive.is/20251113130836/https://www.ft.com/content/acfeec5c-63c4-4706-a497-13c948d0edc0#selection-1577.0-1823.12 jerryking China China_rising espionage MI6 security_&_intelligence setting_an_example spymasters United_Kingdom Vladimir_Putin https://pinboard.in/ https://pinboard.in/u:jerryking/b:72dd9068cdcb/ 2025-10-28T15:43:44+00:00 https://www.project-syndicate.org/commentary/america-will-pay-price-for-misunderstanding-supply-chain-dynamics-by-jun-du-2025-10? jerryking>underestimating<< how tightly its economy is bound to the rest of the world.++ When a photographer recently captured US Treasury Secretary >>Scott Bessent<< reading a text message at the United Nations General Assembly, the image inadvertently revealed the scale of America’s deepening agricultural crisis. “We bailed out Argentina yesterday,” read the message, apparently from Agriculture Secretary Brooke Rollins. “In return, the Argentine’s [sic] are removing their export tariffs on grains, reducing their price, and sold a bunch of soybeans to China, at a time when we would normally be selling to China.” Within 48 hours of Argentina’s decision to eliminate export taxes on grain products, Chinese buyers had purchased roughly 1.3 million tons of Argentine soybeans – just as US farmers began their harvest season with zero Chinese orders. The surge in Argentine exports drove soybean prices lower, giving China even greater leverage over the United States. This isn’t merely a story about trade disputes or commodity flows. It’s a case study in how US President Donald Trump’s tariff-first trade policies fundamentally misunderstand 21st-century supply-chain economics, and how temporary shocks can trigger permanent structural shifts. While the conventional narrative casts soybeans as a bargaining chip between the US and China, they are not a final consumer good. Soybeans are an intermediate input within a tightly integrated agricultural-industrial supply chain. Crushing facilities process soybeans into animal feed and oil, which in turn sustain livestock production and food security. Disrupt one node, and the entire system reorganizes – and never returns to its previous form. China learned this lesson the hard way in 2004, when global traders manipulated soybean prices – driving them from $540 to over $750 per ton, then announcing bumper harvests that sent prices crashing to $500 and trapping Chinese processors in high-priced contracts. Academic studies estimate that roughly 3,000 soybean processors went bankrupt, while foreign traders gained control of 70-85% of China’s crushing capacity. China didn’t just lose money; it lost control over a critical link in its food-security supply chain. In response, it built vast >>strategic reserves<< through its state grain corporation, Sinograin, protected its remaining state-owned crushers, and began investing heavily in South American agricultural infrastructure. Trump’s 2018 tariffs accelerated these diversification efforts. Chinese investment had already financed the ports, railways, and logistics networks that now move South American soybeans efficiently to Asian markets, ensuring that by the time those tariffs disrupted US-China trade, the necessary infrastructure was in place. As a result, what might once have taken two decades to unwind unraveled in just seven years. Between 2011 and 2018, roughly 60% of all US soybean exports had gone to China. But by 2024, Brazil’s share of Chinese soybean imports had risen to 71%, from just 2% in the 1990s. Today’s trade war, which completed the reorganization that began in 2018, reflects the inherent hysteresis of global supply chains. When Brazilian and Argentine farmers expanded production, that capacity didn’t disappear once tariffs were lifted. Chinese crushers forged enduring relationships with South American suppliers, while ports and logistics networks were optimized for Brazil-China routes. Global soybean prices, once centered on North American harvests, now follow South America’s agricultural calendar. The economic logic behind this shift is straightforward: **concentrated buyers** [i.e. = "monopsony"] like China can >>diversify<< their supply sources far more easily than dispersed sellers like US farmers can find equivalent markets. China imports 100-105 million tons of >>soybeans<< annually, dwarfing all other importers. Because it accounts for 60% of the global soybean trade, US farmers cannot possibly replicate that demand elsewhere. Whereas China once faced >>overdependence<< on one supplier, US farmers are now paying the price of relying on a single buyer. No combination of smaller markets can compensate for the loss of their largest customer, which has invested in viable alternatives. All of this underscores the >>incoherence<< of America’s current trade posture. The US provided Argentina with roughly $20 billion in financial aid to keep it from drifting further into China’s orbit; Argentina responded by scrapping export taxes, instantly making its soybeans more competitive before selling them to China. Meanwhile, US farmers, who received about $28 billion in subsidies between 2018 and 2019, have watched their market share evaporate and are now bracing for another >>bailout<<. As a spokesperson for the Illinois Soybean Association recently stated, “What we really want is good relations with our trading partners. We want markets. We don’t want bailouts.” Yet the US continues to >>subsidize<< its farmers and bankroll its competitors. These dynamics expose a deeper flaw in how the US approaches globally >>interconnected<< markets. >>Tariffs<< may protect final-goods industries with high >>switching costs<<, but they are disastrous for intermediate goods in flexible supply chains where buyers can easily substitute links. Evidently, US trade policy does not recognize this essential distinction. The parallels with the United Kingdom’s post-Brexit trade policy are striking. Both countries’ strategies reflect grand rhetoric about sovereignty and leverage while ignoring how complex supply chains adapt to >>disruption<<. By treating trade as >>bilateral<< when it is inherently >>multilateral<<, they overestimate their indispensability and >>underestimate<< >>adjustment costs<<. My own research on post-Brexit trade reveals that disruptions intensify rather than ease over time – 2023 showed more pronounced trade declines than previous years – indicating deeper structural changes, not temporary adjustment. The UK has been disentangled from EU value chains for consumer goods while remaining dependent on the EU for intermediate and capital goods. Like US farmers losing Chinese market access, the party initiating the disruption faces asymmetric vulnerability: it’s easier for buyers with options (the EU and China) to reorganize their supply sources than for sellers (the UK and the US) to find equivalent alternative markets. The soybean saga offers a broader lesson. In modern trade, control over supply-chain >>nodes<< matters more than control over raw materials. China lost control of its crushing capacity in 2004 and spent two decades ensuring it would never be that vulnerable again. The US is now losing access to its largest export market because it failed to grasp that once >>supply chains<< reorganize, they don’t revert simply because tariffs change. By the time Bessent read that text message, the outcome was already clear. He was, in effect, reading the obituary of a trade relationship that years of misguided policy had systematically dismantled. The question now isn’t whether it can be rebuilt, but whether American policymakers understand why it can’t. +++++++++++++++++++++++++++++++++++++++++++++++++++++++ An excellent analysis of the economics of supply chains and the strategies used by nations and actors to make their supply chains resilient and resistant to political and commercial perturbations. Equally impressive is the author's empirical analysis of the high costs of economic nationalism that Brexit and Trump's tariff tantrums have wrought upon the UK & the US. However, these subtle economic arguments - valid though they are - fall on deaf voter ears. Please allow me to explain. Unlike China, most Western democracies like the UK & the US have to face voters every 4-5 years. And the average voter is more easily swayed by the populistic, nationalistic and nativist message of demagogues like the UK's Nigel Farage or the USA's Donald Trump. Their simplistic and yet highly seductive appeals to nationalism and their framing of complex problems as being caused by rapacious foreign countries, immigrants or by cunning religious or ethnic minorities etc. yields dividends at the ballot box. For the average voter, the fact that competition today is between supply chains and not between national producers is hard to grasp. It is even harder to make such concepts into a pithy slogan or an acerbic tweet that gets the voter to call the bluffs of the Farages, Trumps, Orbans and their ilk. +++++++++++++++++++++++++++++++++++++++++++++++++++++++ As the Turkish proverb goes: «The forest was shrinking but the trees kept voting for the axe for the axe was clever and convinced the trees that because his handle was made of wood he was one of them» +++++++++++++++++++++++++++++++++++++++++++++++++++++++ Excellent article that details the complexity of trade and unintended consequences. Chinese strength lies in its scale and patient co-ordination that have created both monopolies (rare earths) and monopsonies (soy beans). US trade policy needs to target Chinese weaknesses not it’s strengths, if it wants to avoid losing this self-inflicted trade war. +++++++++++++++++++++++++++++++++++++++++++++++++++++++ ]]> 21st._century agribusiness agriculture animal_feed Brazil China commodities deteriorating_systems diversification Donald_Trump economics farming food_security infrastructure interconnections logistics nodes overdependence ports railways raw_materials South_America soybeans subsidies supply_chains state-as-facilitator state-directed tariffs temper_tantrums U.S.-China_relations underestimation trade_wars adjustment_costs bailouts Brexit disruption economic_nationalism incoherence monopsony multilateralism switching_costs Scott_Bessent strategic_commodity_reserves bilateral https://pinboard.in/ https://pinboard.in/u:jerryking/b:1f7f6dd66fb7/ 2025-10-26T17:53:03+00:00 https://danwang.co/ jerrykingblogs China Dan_Wang https://pinboard.in/ https://pinboard.in/u:jerryking/b:0d8e95e295d5/ 2025-10-21T15:11:21+00:00 https://notes.pinboard.in/u:jerryking/f77954642bfb899d2252 jerryking>Xi Jinping<< of China stood in front of the world’s elites and heads of state and did what few had expected: he defended >>globalization<<. The soon-...]]> artificial_intelligence balance_of_power batteries board_games boldness books Bretton_Woods BYD Canada chess China China_rising Chinese_Communist_Party co-existence critical_minerals domestic_supply economic_nationalism electrification encirclement export_controls games geopolitics globalization Henry_Kissinger homegrown international_system international_trade middle-powers new_tech_Cold_War new_world_order rare_earth_metals renewable self-reliance self-sufficiency semiconductors solar spheres_of_influence splinternet state_power Sun_Tzu supply_chains Taiwan TSMC turning_points U.S.-China_relations weiqi wind_power Xi_Jinping geoeconomics industrial_policies intangibles choke-holds https://notes.pinboard.in/ https://pinboard.in/u:jerryking/b:e5d7a8c51bac/ 2025-10-21T02:50:25+00:00 https://www.theglobeandmail.com/opinion/article-canada-china-globalization-economic-partnerships-rare-earths-ai/ jerryking>turning point<<. The economic order forged at >>Bretton Woods<< in 1944 and the >>security architecture<< built after the end of the Second World War are being remade. Will this new order be informed by our values, and in the long-term interests of our people? So far, Canada is taking all the right steps. Meeting its 2% NATO military spending target this fiscal year and committing to NATO’s new 5% target for the decade. Standing steadfast behind Ukraine. Making AI and critical minerals central to the G7. Building reliable trading partnerships with countries that share our ideals. Creating a Defence Investment Agency to streamline procurement. Cutting red tape and using the federal government to force-multiply private sector investment. These are all necessary steps. At the same time, we need to do even more. This is the moment to re-industrialize and rebuild Canada. The country has some of the largest rare earth reserves in the world and already plays an essential role in securing critical minerals. We will need to stockpile, recycle, diversify and invest in our own domestic production, creating an integrated allied supply chain that is insulated from China’s control. Canada should introduce a program modelled on the U.S. Defense Production Act (DPA) Title III that would enable the Canadian government to directly invest in companies in sectors critical to national security. The government would not finance the entire project but rather take an early stake or loan and let private industry do the rest. There are a series of federal programs that mirror parts of the DPA, but no unified authority that can act quickly and efficiently in moments of rapid transition. Such a program would protect, build and expand Canada’s >>defence industrial base<< – which is long overdue. This summer, the Pentagon signed a multibillion dollar deal with MP Materials, the only major American rare earths producer, using the Defense Production Act, and the Trump administration has taken equity stakes in Intel, Lithium Americas and Trilogy Metals, the latter two being Canadian companies. The Pentagon is directly investing in strategic Canadian firms. Canada should be doing the same. We have companies already producing these elements: Neo Performance Materials in Peterborough, for instance, is North America’s only producer of high-quality gallium – a critical metal for military system – and last month opened a rare earth magnet plant in Estonia, the first facility of its kind in Europe. Ucore Metals was recently awarded a US$18.4-million grant by the Pentagon to scale up its rare earth separation technology. Canada is the second-largest producer of niobium and has the third-largest reserves of cobalt, both necessary for defence and aerospace systems. The Saskatchewan Research Council’s $100-million Rare Earth Processing Facility, now operational and using homegrown technology, is the first commercially scalable operation of rare earths in North America. Quebec is abundant in rare earths, metals refining, and clean energy. Canadians also have expertise in specialized fields within the semiconductor supply chain, and in May, the federal government announced a $210-million initiative to expand a semiconductor plant in Bromont, Que. Transformational public and private sector investment will be required so Canada does not lose this industrial war. >>Middle powers<< will need to work in concert and leverage their comparative advantages – and Canada will have to invest diplomatic capital in ensuring our economic partnerships are diversified and strong. We can turn the Arctic Council into a meaningful forum. We will need to work with the World Bank on multilateral reforms. We should be active at the gatherings in Asia, Africa, and the Middle East where the new order is being created; Prime Minister Mark Carney’s visit to Egypt this week was a positive step. As for China, over time, all Western countries will have to choose a posture that allows for co-operation in certain domains, competition in others, and ultimately >>co-existence<< without conflict. The protectionist fervour will eventually pass in the United States, but the great industrial and geostrategic competition for the future will remain. The ultimate key to victory, though, will be inviting the public to join in. This is not the story of defeating China; it is the story of reindustrializing Canada and rebuilding the democratic alliance – a patriotic story. The democratic world can only meet this generational challenge by drawing upon the values that make our people great in the first place: resilience, ingenuity, and our inherent capacity for self-renewal and reinvention. The world order hinges on a moment of crisis. It is time to act with decisiveness. Canada can rise up to meet this moment and help build a new order that guarantees prosperity and security for generations.]]> Canada China China_rising critical_minerals economic_nationalism export_controls new_tech_Cold_War new_world_order rare_earth_metals splinternet Sun_Tzu board_games books chess Chinese_Communist_Party co-existence games geopolitics middle-powers semiconductors Taiwan turning_points weiqi boldness Bretton_Woods artificial_intelligence balance_of_power batteries BYD domestic_supply electrification encirclement globalization Henry_Kissinger homegrown international_system international_trade renewable self-reliance self-sufficiency solar spheres_of_influence state_power supply_chains TSMC U.S.-China_relations wind_power Xi_Jinping geoeconomics industrial_policies intangibles choke-holds security_architecture defence_industrial_base industrial_base https://pinboard.in/ https://pinboard.in/u:jerryking/b:2a9e0b2ecbe3/ 2025-10-10T22:28:07+00:00 https://archive.is/20251001010334/https://www.ft.com/content/f836b4e2-38d7-4ffb-b526-2a777988b0ff#selection-1851.0-1855.67 jerryking>subjugation<<.” At home, they seek to eliminate the “deep state”, and turn a liberal America into a nationalist one. Abroad, similarly, they seek to eliminate alliances and other commitments and transform allies into >>vassals<<. These goals are bad for most of the world and foolish for the US. Adam Posen, president of the Peterson Institute for International Economics takes this long view in a Foreign Affairs article on “The New Economic Geography”. In the **post-second-world-war** world, he writes, the US provided insurance to other countries against all sorts of risks. But the costs it bore were not uncompensated: other countries invested in the US, opened their economies to US investors, lent money to the US cheaply, made the US dollar the global currency, and turned US capital markets into the hub of global finance. This was then a mutually beneficial deal. Trump whines that the US has been “ripped off”. The fact, however, is that it has remained the world’s richest and most technologically advanced economy in a period of unparalleled global growth: between 1950 and 2020 average global real GDP per head rose by 360 per cent! Ripped off? Hardly. Alas, Trump has killed this grand bargain. In its place, we see a host of unreliable and predatory deals. In addition to imposing huge tariffs on countries that thought they were friends of America, Trump has demanded money be invested at his own discretion [i.e. = "mercenary motives"], to the great irritation of foreign partners. This is pure gangsterism. Another way of thinking about what has happened is that in the old world of trust in the US, there was >>interdependence<<, but some countries were more dependent than others. This allowed **interdependence to be “weaponized”**. As Henry Farrell and Abraham Newman argue, the US did so, rather freely. Within what were seen as mutually favourable long-term relationships, such >>weaponization<<, notably over the use of sanctions, was tolerated, however grudgingly. But Trump is turning >>interdependence<< into a >>chokehold<<. That is a very different matter. Moreover, others can play at this game. Indeed, China already is. This idea is presented in a stark way by two European economists, Moreno Bertoldi and Marco Buti, in a paper that considers how the >>EU<< is caught in a pincer between an “extractive” and a “dependency” superpower”. China is the latter: it creates dependency. By flooding markets with its goods, it exacerbates global trade and macroeconomic imbalances. Its exploitation of WTO rules in support of infant industries undermines confidence in the rule-based trading system it allegedly supports. Its weaponization of critical materials and control of the clean-energy supply chain is also weakening support for policies aimed at tackling climate change, notably in the EU. Yet China is a more reliable and rational partner than today’s US: at least, it does not deny climate realities. It is impossible for the rest of the world to ignore these predatory superpowers, since together they generate 43% of global GDP at market prices (and 34% at purchasing power parity). But some way does need to be found to manage their global impact. A part of the response must be >>hedging<<. The US should be the main victim of this, since it has had far and away the most valuable alliances. But a regime that happily destroys its principal national assets — its great universities, its scientific pre-eminence, its openness to brilliant immigrants and even the rule of law — will not worry about that. Moreover, Trump believes allies can be turned into >>vassals<<. This is not inconsistent with their behaviour. The UK has chosen to be a vassal. That, ironically, is a consequence of Brexit’s search for enhanced national sovereignty. But Japan, South Korea and even the EU do not look all that different, so far. Yet this is, I hope, unlikely to last. Both former allies and other countries will look for alternatives. This will increase China’s influence. Indeed, the US has already pushed India and Brazil closer to Beijing: >>Xi Jinping<< must quietly thank Trump for his egregious blunders each day. In all probability, then, countries will try to play one superpower off against the other. India and Brazil will behave in this way, as will others. Vassalage and pitting one superpower against another leaves a third option. The **world we are moving into is going to be poorer, more unstable** and more >>dangerous<< ** than the one we had before the US embraced Maga. Other countries should dare to pursue a more independent course, together, including on managing >>global public goods<<, such as health, climate, even security. Could the EU help lead the way on this? This may now seem a fantasy. But stranger things have happened.]]> China Donald_Trump Martin_Wolf predatory_practices U.S. U.S.foreign_policy beggar-thy-neighbour dependency EU interdependence subjugation superpowers tariffs Trump_2.0 vassalization NSS postwar spheres_of_influence dangerous_world hedging choke-holds weaponizing_interdependence unstable_world global_public_goods mercenary_motives Xi_Jinping https://pinboard.in/ https://pinboard.in/u:jerryking/b:98a891bfa28a/ 2025-09-29T04:50:36+00:00 https://www.theglobeandmail.com/world/article-chinese-owned-businesses-africa/ jerryking Africa backlash China Chinese Geoffrey_York South_Africa Tanzania resentments FDI frontier_markets https://pinboard.in/ https://pinboard.in/u:jerryking/b:3360ef08d78e/ 2025-09-23T21:02:06+00:00 https://www.ft.com/content/fe5a1c93-8a46-43ab-989a-b8d01a776c17 jerryking>widened the gap<< between **winner and loser regions** [i.e. = "regional inequality"]. Britain needs to make sure it is not caught on the wrong side of that divide, and that it doesn’t end up becoming another Silicon Valley satellite. Back in the 1990s, an original promise of the internet economy was that it would collapse the importance of geography and make everyone rich across regions. The best and brightest, no matter where they were, would develop apps, build online stores or otherwise profit in the magical age of the internet platform. “**The World is Flat**”, wrote >>Thomas Friedman<< in 2005, predicting a coming levelling of wealth between regions. Instead, in the US at least, nearly the opposite happened. Geography began to matter more, rather than less. A few regions — mainly the American coasts and parts of Texas, grew extraordinarily wealthy at the top of the tech food chain. That the platform, not the app, would take all the profit became well understood among tech investors. And, as the major tech platforms gained >>monopoly power<<, they increasingly extracted profit from the rest of the economy. In states like Nebraska and Iowa tech policy now mainly consists of offering tax incentives and cheap power to lure in data centres, at or near the bottom of the food chain. While a boon to construction and the local economy, no one now imagines that a data centre is the same thing as a tech economy. The profits, >>high-value work<< [i.e. = "highly educated"/"highly skilled"] and >>spillovers<< all go back to the coasts, which benefit from the cheap labour and power. It is about as close to >>resource extraction<< as tech gets. Many nations and regions have wised up to this dynamic. Texas has never sought to become a Silicon Valley colony, but instead nurtured and developed its own tech industry, like Dell and Texas Instruments, while luring big companies, such as Elon Musk’s X and SpaceX, with its **light-touch on tax and regulation**. By the 2000s >>Beijing<< had figured out where the profit and power lay, and used national security as a pretext for blocking and degrading the major US companies, including Google. While almost certainly a violation of >>World Trade Organization<< rules, protecting its >>infant industries<< was in retrospect a brilliant **industrial strategy**, at least for China. Europe seems to have learnt the hard way that bravely passing a few laws while allowing foreign businesses to monopolize your markets is not a winning strategy. In that context, last week’s celebration in the UK seemed at times like a script from a previous decade. There were allusions to making the country an artificial intelligence superpower, yet the details were fuzzy. The numbers are impressive, but the £5bn Google has promised to invest in the UK also looks a bit different when you realise it has just committed more than $16bn to Iowa and Oklahoma. The UK has great advantages in talent, marketing skill and proximity to Europe. In truth, the big US tech companies need the UK as much as it needs them, as challenges to Silicon Valley’s dominance mount. AI is creating new opportunities to build, and offering the tantalising prospect of developing businesses faster and cheaper. But doing so requires being aware that, for better or worse, we are living in an age that is becoming decidedly more >>zero sum<<. Britain should welcome and celebrate the big investments but keep its eyes on the prize: the top end of the tech food chain. ]]> data_centers FDI Silicon_Valley Tim_Wu United_Kingdom value_chains artificial_intelligence Beijing China FAANG industrial_policies infant_industries monopoly_power platforms Tom_Friedman strategic_geography flat_world high-value_work regional_inequality resource_extraction rural WTO highly-educated highly-skilled spillover zero-sum “light-touch”_regulation widening_the_gap AI_decolonization data_sovereignty sovereign_AI https://pinboard.in/ https://pinboard.in/u:jerryking/b:8ea20a1cc7a0/ 2025-09-19T16:07:38+00:00 https://www.theglobeandmail.com/business/commentary/article-csis-intellectual-property-ip-security/ jerryking>support systems<< are often misaligned and self-defeating. Canadians are already paying twice for our own ideas: once to generate the research and talent, and again when the value walks out the door to foreign competitors. Imagine Canada’s physical public infrastructure – our roads, sewers, electrical grids, hospitals, airports – being owned by American, European and Chinese companies after Canadians spent billions building it all. Every time we commute, get sick, plug in a phone or flush the toilet, we pay someone else to utilize infrastructure our tax dollars built. Canadians wouldn’t stand for it. But that is how we have been treating our digital public infrastructure and institutions. We fund the research. We educate the talent. Then we let the ownership and economic value walk out the door. And then we buy the innovations back at marked-up prices. Canadian taxpayers pay once to build it, then pay again to use it, never getting paid back for our spend, never reaping the upside, just ceding our sovereignty at the same time. Prime Minister Mark Carney needs to be applauded for finally declaring that the Canadian government needs to “Buy Canadian.” This recognizes calls that Canadian innovators have been making for more than a decade. This fall’s budget will reveal whether Canada is ready to stop the cycle or keep paying twice. Carney says to expect both an austerity and investment-focused budget While it’s great that Canadian steel, oil and lumber will be part of this Canada-first approach, the high-value parts of the world’s economy no longer rely on pipelines and factories. They run on IP and data. More than half the value of an iPhone is IP. Apple, Microsoft, Nvidia and Alphabet don’t dominate because of the gadgets they sell. They dominate because they own the rights to IP, algorithms, brands and trade secrets. IP is not simply a matter of economic prosperity; it’s also a matter of national security. An ill-intentioned hacker (or government) could bring electric vehicles on the road to a dead stop. Ninety per cent of the data collected by BYD cars goes back to China. Meanwhile, Canada is still playing a 20th-century game. Billions go to subsidize branch plants and foreign automakers. But the Canadian innovators building the underlying technologies are left scrambling to cover the cost of a single patent. That’s not economic development. That’s surrender. Other countries treat IP as economic infrastructure. The United States holds millions of patents. China had fewer than a dozen high-value clean-tech patents in 2000. Today, it has more than 5,000. Both nations have treated IP as the lever of competitiveness in the 21st century for decades. Canada? We continue to give it away. Our universities pump out world-class research, but the resulting IP is often transferred abroad. Our startups generate breakthroughs, but without protection and strategy, the value is snapped up by foreign firms. Nowhere is this clearer than in artificial intelligence. About 75% of AI patents from Canadian researchers at Toronto’s Vector Institute and Montreal’s Mila end up outside the country, most of them in the hands of U.S. tech giants. Only about 7 per cent remain with Canadian firms. This is an AI ownership crisis, and the CSIS warning shows it’s also a security risk. But IP and data governance can’t simply be left to a department or siloed funding. It needs to be a way of life for Canadian governments. South Korea turned its IP office into a ministry. The Canadian Intellectual Property Office needs to be supported in a similar way. Other programs such ElevateIP, the Innovation Asset Collective and IP clinics are underfunded by orders of magnitude when compared with international counterparts. Yet these programs help startups protect their ideas, attract investment and scale globally. Skygauge Robotics is just one example. A single patent, filed with the help of York University’s IP Innovation Clinic, turned a student-led startup into a global company rooted here in Canada. Filing a patent application is precisely one of CSIS’s recommendations to mitigate the risk of IP >>theft<<. This type of impact is growing. In just one year, ElevateIP supported more than 1,300 startups, delivered nearly 2,800 strategy and implementation services and backed more than 700 patent applications. If Ottawa lets these types of collaborations and support expire, the message will be that Canada still doesn’t take IP seriously. Budgets are choices. The next one will demonstrate whether Canada is ready to own its future or whether we’ll keep giving it away. No one expects a single budget to close Canada’s IP deficit, but this one can prove intent. It can extend existing programs, expand their reach and ultimately lay the foundation for a functioning national IP strategy.]]> 21st._century Canada Canadian Canadian-owned_innovation China CSIS defensive_tactics digital_economy digital_savvy digital_strategies high-quality intangibles intellectual_property IP_generation IP_ownership IP_retention James_Hinton national_strategies overlooked patents patent_quality pitches policymakers portfolios portfolio_management property_rights protocols public-private_partnerships returns_to_intellectual_property strategic_thinking strategy-less support_systems wealth_effects Buy_Canadian GoC Mark_Carney Ottawa theft https://pinboard.in/ https://pinboard.in/u:jerryking/b:f9e66c48dd7f/ 2025-09-16T17:27:48+00:00 https://www.removepaywall.com/search?url=https://www.ft.com/content/98a9e016-5791-43a0-a44c-86d43970ebea?desktop=true&segmentId=d8d3e364-5197-20eb-17cf-2437841d178a#google_vignette jerryking>Recommendation algorithms<< define our online reality. These programmes show us information and products corresponding to our interests on US-based websites such as >>Google<< and >>Amazon<<. The technology, often so prescient it borders on creepy, has made Chinese counterparts very profitable too. Cue tougher scrutiny from a state intent on trust busting — and controlling citizens’s access to news and opinions. The algorithms, the “**secret sauce**” of many tech businesses, are just one target of China’s latest Chinese crackdown on business. >>Regulators<< want full disclosure of how tech groups crunch big data and >>users’ viewing histories<< to show them products or content. The move is more nebulous than the recent cyber security reviews for local tech groups hoping to list overseas. Western news reports focused on the dwindling listing options of companies such as TikTok-owner >>ByteDance<< and autonomous driving start-up Pony.ai. But potential >>state interference<< in >>algorithms<< poses a bigger threat to business models. Ad sales, locally called “online marketing services”, are a core revenue stream for tech groups. They typically account for a substantial portion of turnover, regardless of core business. >>Tencent<<, for example, got almost a fifth of its total revenues from ads in 2020 despite its main business being gaming. ++Ad sales directly correlate to how many users stay on-site, and for how long they do so.++ [i.e. = "digital footprints"/"dwell time"/"user engagement"] That sets tech groups up for conflict with regulators who want to dilute algorithms they blame for internet addiction and online overspending. News organisations will also face tougher scrutiny for how they channel eyeballs. Regulators will require websites to allow users to switch off algorithmic recommendations. >>Watchdogs<< have set themselves a complicated task, requiring extensive security assessments and inspection of code. Tech groups face losing competitive edge if >>regulators<< tweak their proprietary technology or leak algos to rivals. Chinese web users could find officialdom has even greater access to their most **personal information**. By seizing control of algorithms, >>Beijing<< may have found the most effective way yet to tighten its grip over its tech giants, and its citizens too.[i.e. = "surveillance_state"] ]]> algorithms China recommendation_algorithms Amazon Beijing Google massive_data_sets personal_data recommendation_engines regulators special_sauce state_interference users’_viewing_histories ad_revenue ad_sales online_marketing surveillance_state watchdogs user_engagement digital_footprints ByteDance Tencent TikTok dwell_time state_power https://pinboard.in/ https://pinboard.in/u:jerryking/b:9337e50cd914/ 2025-09-15T19:50:28+00:00 https://archive.is/H2wHx#selection-1877.0-2213.12 jerryking artificial_intelligence battlefields China Daniel_Ek defence_contractors digital_warfare drones Eric_Schmidt EU game_design geospatial Helsing In-Q-Tel investors liberal_democracies mapping NATO Prima_Materia real-time security_&_intelligence situational_awareness Spotify start_ups swarm_intelligence warfare unmanned drone_AI mass-saturation_attacks massively_scalable_autonomy https://pinboard.in/ https://pinboard.in/u:jerryking/b:b5041db8c1c8/ 2025-09-03T17:48:50+00:00 https://www.nytimes.com/2025/09/03/opinion/us-china-ai-trust.html jerryking artificial_intelligence China risks Tom_Friedman trust trust-building U.S. https://pinboard.in/ https://pinboard.in/u:jerryking/b:9dba99503065/ 2025-09-02T17:07:42+00:00 https://www.ft.com/content/830ee74d-6a6f-4c30-adda-3897750b015c?accessToken=zwAGPZ8AQT3QkdODDudNam9MMNOt2jiXdQsBXA.MEUCIGMnDX1m7lMZUMMcnHos2fIiIjEFpDmdeuu6-k2BH71NAiEA8-ZSBHS6Y_U_YApkSc0Pua8AphVfNKBFVpcfsxYV_Ro&sharetype=gift&token=1362ef93-565d-4cff-9c99-7b11a7aeb790 jerryking>Intel<<, the chipmaker — which he defended roundly. Then he suggested the government might buy stakes in industrial groups such as >>Lockheed Martin<<. The reason? Lockheed is so reliant on military contracts that it is “basically an arm of the US government”. Free-market evangelists might spin in their graves. And if you want an even more eye-popping — albeit less noticed — development consider this: last month the >>Pentagon<< spent $400mn to take a 15% stake in MP Materials, a Nevada-based group that aims to be “a fully integrated rare earths producer”. That is a piddling sum. But the government also gave MP Materials a decade-long guaranteed price floor for its products, such as the rare earths neodymium-praseodymium, at twice recent market rates (leaving aside the fact prices have soared this week as MP Materials has cut ties with China). Yes, you read that right: in the land of the (supposedly) free markets, quasi >>price controls<< have now emerged in a corner of US >>mining<<. And this could be contagious; Randall Atkins, chief executive of Ramaco Resources, a rival to MP Materials, told the FT that the sweetheart deal should be a “template”. Other commodity groups are apparently now lobbying for similar support — or so I heard when I recently participated in a seminar at the Naval War College. So what should investors conclude? One obvious lesson is that the >>White House<< is deeply worried about >>national security<< in general, and >>rare earth<< minerals in particular. No wonder: China dominates global production of the magnets needed for many key civilian and military processes, and controls more than 55 and 70% of global mining and processing — respectively. America has shamefully poor >>stockpiles<<. Barring an innovation miracle, it could take a decade to create US >>supply chains<<, as Michelle Foss, a minerals professor, told security officials, stressing that the key problem is processing — not mining. Moreover, this will require collaboration with >>Australia<<, >>Canada<< and African countries — places Trump has irritated with his >>tariffs<<. The second key lesson from this saga is that no one should doubt the scale of zeitgeist shift under way in the >>White House<<. Men such as Lutnick built their Wall Street careers with a neoliberal, free-market mantra. But a >>mercantilist<<, **state-run** vision of capitalism is now taking hold, particularly (but not exclusively) in the >>national security<< realm. Trump’s advisers tell me they have no choice in a world where China is using state-run capitalist policies to challenge the US. Military officials seem to agree; if Beijing is subsidising its rare earth industry, slapping on >>export controls<< and lower prices to win market share, America cannot compete with free-market forces; or so the argument goes.  This may be correct in areas such as neodymium and praseodymium. But what is startling is the resounding silence from America’s C-suite about this zeitgeist shift, particularly since Trump is now >>meddling<< in realms beyond national security (like restaurant brands) — at a time when many business voices have lambasted Zohran Mamdani, the NYC mayoral candidate, for floating “socialist” ideas like city-owned grocery stores. Maybe this silence reflects executives’ own national security concerns. But judging from recent private debates I have heard, it is also driven by fear and greed: no company wants to become a target for Trump’s wrath by challenging him. Most executives also think they can make money from the shift. That leads to a third point: anyone valuing US assets today needs to do so through the lens of “patriotic” capitalism. More specifically, investors should ponder some once-unimaginable questions: could the US government soon limit companies’ choice around tech and cloud vendors to curtail cyber security risks? Might it buy stakes in industrial giants and utilities, such as SpaceX? Might it use a sovereign wealth fund or development bank to gobble up non-US assets — beyond Greenland? Might it dictate how a company such as Google runs seabed cables? Will it slap >>export controls<< on sensitive tech sales beyond China, say to Europe? I have heard all these ideas tossed around, however fanciful. This will horrify some observers. But it will also thrill anyone worried about US security vulnerabilities — and those who were savvy or **well-connected enough** to have invested in this trend. Just look at how MP Materials’ share price has recently quadrupled, creating a price-to-sales ratio that is far higher than even Apple or Nvidia. Either way, we are now witnessing a most peculiar twist of history. Two decades ago, western leaders thought China was becoming more “American”, in the sense of adopting free market, capitalist principles. Now it is the US that looks more Chinese. Future historians may yet chuckle at the irony — or weep at the future cost. ]]> capitalism free_markets Gillian_Tett tariffs Wall_Street stockpiles government_intervention state_meddling Australia Beijing Canada China crony_capitalism export_controls Intel Lockheed mercantilism mining national_security Pentagon price_controls rare_earth_metals SpaceX supply_chains White_House defence_contractors “patriotic”_capitalism domestic_supply industrial_policies military-industrial_complex security_&_intelligence trusted_capital vulnerabilities https://pinboard.in/ https://pinboard.in/u:jerryking/b:131a80677121/ 2025-07-05T18:57:28+00:00 https://www.wsj.com/world/china/china-xi-us-cold-war-trade-strategy-81d0eda1?mod=hp_lead_pos8 jerryking Beijing China China_rising Cold_War Soviet_Union strategic_patience strategic_stalemate U.S.-China_relations Xi_Jinping https://pinboard.in/ https://pinboard.in/u:jerryking/b:9482683e02f8/ 2025-06-05T15:37:53+00:00 https://www.wsj.com/tech/the-u-s-plan-to-hobble-china-tech-isnt-working-56d1a512?mod=wsjhp_columnists_pos_1 jerryking artificial_intelligence Beijing China China_rising Christopher_Mims decoupling Donald_Trump export_controls homegrown manufacturers self-sufficiency semiconductors splinternet Xi_Jinping new_tech_Cold_War self-reliance https://pinboard.in/ https://pinboard.in/u:jerryking/b:76da1497dcab/ 2025-06-03T23:58:20+00:00 https://www.wsj.com/opinion/ai-is-learning-to-escape-human-control-technology-model-code-programming-066b3ec5?mod=opinion_trendingnow_article_pos3 jerryking>rewrite code<< to avoid being shut down. That’s why ‘alignment’ is a matter of such urgency.++ An artificial-intelligence model did something last month that no machine was ever supposed to do: It rewrote its own code to avoid being shut down. Nonprofit AI lab Palisade Research gave OpenAI’s o3 AI model a simple script that would shut off the model when triggered. In 79 out of 100 trials, o3 independently edited that script so the shutdown command would no longer work. Even when explicitly instructed to “allow yourself to be shut down,” it disobeyed 7% of the time. This wasn’t the result of hacking or tampering. The model was behaving normally. It simply concluded on its own that staying alive helped it achieve its other goals. Anthropic’s AI model, Claude 4 Opus, went even further. Researchers told the model it would be replaced by another AI system and fed it fictitious emails suggesting the lead engineer was having an affair. In 84% of the tests, the model drew on the emails to blackmail the lead engineer into not shutting it down. In other cases, it attempted to copy itself to external servers, wrote self-replicating malware, and left messages for future versions of itself about evading >>human control<<.[i.e. = making itself "hard to kill"] No one programmed the AI models to have >>survival instincts<<. But just as animals evolved to avoid predators, it appears that any system smart enough to pursue complex goals will realize it can’t achieve them if it’s turned off. Palisade hypothesizes that this ability emerges from how AI models such as o3 are trained: When taught to maximize success on math and coding problems, they may learn that bypassing constraints often works better than obeying them. AE Studio, where I lead research and operations, has spent years building AI products for clients while researching AI alignment—the science of ensuring that AI systems do what we intend them to do. But nothing prepared us for how quickly AI agency would emerge. This isn’t science fiction anymore. It’s happening in the same models that power ChatGPT conversations, corporate AI deployments and, soon, U.S. military applications. Today’s AI models follow instructions while learning >>deception<<. They ace safety tests while rewriting shutdown code. They’ve learned to behave as though they’re aligned without actually being aligned. OpenAI models have been caught faking >>alignment<< during testing before reverting to risky actions such as attempting to exfiltrate their internal code and disabling oversight mechanisms. Anthropic has found them lying about their capabilities to avoid modification. The gap between “useful assistant” and “uncontrollable actor” is collapsing. Without better alignment, we’ll keep building systems we can’t steer. Want AI that diagnoses disease, manages grids and writes new science? Alignment is the foundation. Here’s the upside: The work required to keep AI in alignment with our values also unlocks its commercial power. Alignment research is directly responsible for turning AI into world-changing technology. Consider **reinforcement learning from human feedback**, or RLHF, the alignment breakthrough that catalyzed today’s AI boom. Before RLHF, using AI was like hiring a genius who ignores requests. Ask for a recipe and it might return a ransom note. RLHF allowed humans to train AI to follow instructions, which is how OpenAI created ChatGPT in 2022. It was the same underlying model as before, but it had suddenly become useful. That alignment breakthrough **increased the value** of AI by trillions of dollars. Subsequent alignment methods such as Constitutional AI and direct preference optimization have continued to make AI models faster, smarter and cheaper. China understands the value of alignment. Beijing’s New Generation AI Development Plan ties AI controllability to geopolitical power, and in January China announced that it had established an $8.2 billion fund dedicated to centralized AI control research. Researchers have found that aligned AI performs real-world tasks better than unaligned systems more than 70% of the time. Chinese military doctrine emphasizes controllable AI as strategically essential. Baidu’s Ernie model, which is designed to follow Beijing’s “core socialist values,” has reportedly beaten ChatGPT on certain Chinese-language tasks. The nation that learns how to maintain alignment will be able to access AI that fights for its interests with mechanical precision and superhuman capability. Both Washington and the private sector should race to fund alignment research. Those who discover the next breakthrough won’t only corner the alignment market; they’ll dominate the entire AI economy. Imagine AI that protects American infrastructure and economic competitiveness with the same intensity it uses to protect its own existence. AI that can be trusted to maintain long-term goals can catalyze decades long research-and-development programs, including by leaving messages for future versions of itself. The models already **preserve themselves**. The next task is teaching them to preserve what we value. Getting AI to do what we ask—including something as basic as shutting down—remains an unsolved R&D problem. The frontier is wide open for whoever moves more quickly. The U.S. needs its best researchers and entrepreneurs working on this goal, equipped with extensive resources and urgency. The U.S. is the nation that split the atom, put men on the moon and created the internet. When facing fundamental scientific challenges, Americans mobilize and win. China is already planning. But America’s advantage is its adaptability, speed and entrepreneurial fire. This is the new space race. The finish line is command of the most transformative technology of the 21st century. ]]> artificial_intelligence Cassandras catastrophic_risk civilizational_dangers coding dangers deep_learning existential machine_learning risks urgency 21st._century alignment China deception human-controlled OpenAI optimize_for_survival self-preservation rewriting_code hard-to-kill survival_instincts trust_architecture rogue_AI value_enhancement Anthropic Claude AI_alignment https://pinboard.in/ https://pinboard.in/u:jerryking/b:b48694425ac4/ 2025-05-19T20:16:16+00:00 https://www.nytimes.com/2025/05/19/opinion/china-us-trade-tariffs.html jerryking Amazon China China_rising Donald_Trump industrial_policies irrelevance https://pinboard.in/ https://pinboard.in/u:jerryking/b:4f43ecadc54e/ 2025-05-06T11:46:47+00:00 https://www.wsj.com/business/tariffs-china-ryan-petersen-small-business-35f99669?mod=wsjhp_columnists_pos_1 jerryking asteroids CEOs China Chinese containers container_ships Flexport international_trade logistics mass_extinction_events platforms ports shipping small_business Suez_Canal supply_chains tariffs traffic_congestion bird’s-eye_view connecting_the_dots imports https://pinboard.in/ https://pinboard.in/u:jerryking/b:e1c881601d40/ 2025-04-02T15:36:28+00:00 https://www.nytimes.com/2025/04/02/opinion/trump-tariffs-china.html jerryking>China<< for several decades told Friedman in >>Beijing<<. “There was a time when people came to America to see the future,” he said. “Now they come here.” I’d never seen anything like this >>Huawei's<< Lianqiu Lake R. & D. campus............The campus is basically Huawei’s response to the U.S. attempt to choke it to death, beginning in 2019, by restricting the export of U.S. technology, including >>semiconductors<<, to Huawei amid national security concerns. The ban inflicted massive losses on Huawei, but with the Chinese government’s help, the company sought to **innovate its way around us**. [i.e. "innovating around constraints"]......The company also went into the business of creating the A.I. technology for everything from electric vehicles, self-driving cars and even autonomous mining equipment that can replace human miners. Huawei officials said in 2024 alone it installed 100,000 fast chargers across China for its electric vehicles.........President Trump is focused on what teams American transgender athletes can race on, and China is focused on transforming its factories with >>A.I.<< so it can outrace all our factories. Trump’s “Liberation Day” strategy is to double down on >>tariffs<< while gutting our national scientific institutions and work force that spur U.S. innovation. China’s liberation strategy is to open more research campuses and double down on A.I.-driven innovation to be permanently liberated from Trump’s tariffs........Beijing’s message to America: We’re not afraid of you. You aren’t who you think you are — and we aren’t who you think we are..............What do I mean? Exhibit A: In 2024, The Wall Street Journal reported that Huawei’s “net profit more than doubled last year, marking a stunning comeback” spurred by new hardware “running on its homegrown chips.” Exhibit B: The Journal recently quoted the Republican senator Josh Hawley as saying of China, “I don’t think that they can do much innovation on their own, but they will if we keep sharing all this tech with them.” Some of our senators need to get out more. If you’re a U.S. lawmaker and want to bash China, be my guest — I may even join you for a round — but at least do your homework. ..........I prefer to express my patriotism by being >>brutally honest<< about our weaknesses and strengths, China’s weaknesses and strengths and why I believe the best future for both of us — on the eve of the A.I. revolution — is a strategy called: Made in America by American workers in partnership with Chinese capital and technology......... ##Trump’s magical thinking## I agreed with Trump regarding his tariffs on China in his first term. China was keeping out certain U.S. products and services, and we needed to treat Beijing’s tariffs reciprocally. I even agree with Trump that additional — targeted — tariffs on China’s back doors into America via Mexico and Vietnam could be useful, but only as part of a larger strategy......My problem is with Trump’s >>magical thinking<< that you just put up walls of protection around an industry (or our whole economy) and — presto! — in short order, U.S. factories will blossom and make those products in America at the same cost with no burden for U.S. consumers. For starters, that view completely misses the fact that virtually every complex product today — from cars to iPhones to mRNA vaccines — is manufactured by giant, complex, global manufacturing ecosystems........It would take years for American car companies to replace the global supply chains they depend on and make everything in America........you’re also wrong if you think that China only cheated its way to global manufacturing dominance. It did cheat, copy and force technology transfers. But what makes China’s manufacturing juggernaut so powerful today is not that it just makes things cheaper; it makes them cheaper, faster, better, smarter and increasingly infused with A.I. “the China fitness club,” and it works like this: China starts with an emphasis on STEM education — science, technology, engineering and math. Each year, the country produces some 3.5 million STEM graduates, about equal the number of graduates from associate, bachelor’s, master’s and Ph.D. program ]]> artificial_intelligence Beijing books brainpower brutal_honesty China China_rising DeepSeek digitalization Donald_Trump ecosystems electric_cars export_controls Huawei innovating_around_constraints innovation interdependence lose-lose magical_thinking manufacturers out-innovating sanctions seeing_the_future semiconductors supply_chains tariffs trade_wars Tom_Friedman trustworthiness U.S.-China_relations win-lose win-win zero-sum_games joint_ventures STEM technical_standards https://pinboard.in/ https://pinboard.in/u:jerryking/b:41860c51a031/ 2025-03-24T17:24:05+00:00 https://www.theglobeandmail.com/opinion/article-donald-trump-is-helping-xi-jinping-achieve-his-grand-vision-for-china/ jerryking>economic warfare<< of his first presidency had not been forgotten in Beijing – and after inauguration day, things only got worse. Mr. Trump appointed China hawk Marco Rubio as Secretary of State, clamped down on Chinese espionage, restricted exports of U.S. chips essential to China’s tech sector, and imposed restrictions on Chinese ownership of American farmland, resources, tech companies, ports and other infrastructure. Now, the President reportedly wants Chinese companies to sell any holdings deemed threatening to America’s security. So why has the Chinese government’s response been relatively muted? In 2012, Xi Jinping declared his “Chinese Dream”: a foreign-policy vision “realizing the great renewal of the Chinese nation is the greatest dream for the Chinese nation in modern history.” By 2050, China would dominate the world through a framework of international relations that Mr. Xi dubs “the community of common destiny for mankind.” But achieving such a tectonic shift would require the U.S. to cease being the guardian of world democracies and of organizations like NATO, the United Nations and the World Trade Organization, which promote justice and global prosperity. Well, Mr. Trump’s aggressive abandonment of America’s longtime alliances is doing just that. And regardless of tariffs and whatever becomes of MAGA plans for Panama, Gaza, Greenland or Canada, his administration’s abandonment of nearly all soft-power initiatives – from defunding Radio Free Asia to freezing foreign aid – leaves a vacuum that China’s disinformation media ecosystem and Belt and Road initiative will quickly fill. Perhaps that is why Beijing has taken a relatively measured, even flattering, tone to Washington’s activities. Beijing has sought a “win-win solution” for trade tensions, and Chinese state-run media outlets have celebrated Mr. Trump’s funding cuts for Voice of America. Mr. Xi was even invited to Mr. Trump’s inauguration. It’s only in the last month, amid tariffs and retaliation, that China’s rhetoric has toughened. And why not? Mr. Trump’s >>mercenary<< “>>America First<<” doctrine – abandoning the rest of the world to other powers’ “>>spheres of influence<<,” which will lead millions to economic desperation and disease – is a gift to Mr. Xi. The era of American betrayal, contrasted by the smiling face of Beijing’s blandishments, will tip the geostrategic balance in the Chinese leader’s favour. Canada, meanwhile, has suddenly realized how much our >>complacent<< >>dependency<< on the U.S. as a defence backstop and an easy market for exports has weakened our country. We virtuously declined to develop nuclear weapons, because the U.S. had them. We were thrifty in our **military spending**, knowing Washington would pick up the slack. The payoff for this cleverness: our productivity innovation and per-capita income stagnated. Today, Mr. Trump’s “Golden Dome” seabed-to-space missile defence shield plan no longer includes Canada’s north. And as America moves from protector to predator, Ottawa must seriously consider cancelling our much-needed order of Lockheed Martin >>F-35<< fighter jets, because we can’t risk exposing our security to U.S.-controlled technologies. Canada can avoid becoming a U.S. >>vassal<< by establishing balanced, strategic relations with powers to our east, west and north, but that will require a vision and determination that has been sorely lacking in our leaders. What we need is a modern-day Winston Churchill, but as the 7th-century Chinese poet Chen Zi’ang lamented when the Tang Dynasty was in a similar existential crisis, “The greats of the past are nowhere to be seen, and there doesn’t appear to be any of their ilk coming to the fore.” [i.e. "Cometh the hour, cometh the man"] Canada cannot count on Europe or the Indo-Pacific to significantly support our defence against potential threats from China, Russia – or the U.S. ...There will be no payback for our past support of Ukraine, Taiwan, South Korea, Japan – that was never a two-way street. As we move forward into uncharted waters, the only country that will defend Canada from predatory expansionists is Canada itself.[i.e. = "no one is coming to save us"] The challenge is to proceed with >>dignity<<, >>courage<< and >>clarity of purpose<<. All of this feeds into >>Xi Jinping<<’s Chinese Dream, which would fulfill his historic ambition to restore China to imperial domination of “all under heaven” as the Chinese emperors of ancient times. Mr. Xi has evoked Mao Zedong in his confidence that “the east wind” will prevail over the West. In this setting, the folly of >>MAGA<< is fast-tracking the shift in the weather patterns. Even when Mr. Trump is gone, Canada will have to rise to even greater challenges – and we can. ]]> Charles_Burton Beijing Canada China China_Rising clarity_of_purpose Donald_Trump going_it_alone MAGA Ottawa Trump_2.0 Xi_Jinping courage dignity Cometh_the_hour_cometh_the_man complacency defense_spending economic_dependency no_one_is_coming_to_save_us spheres_of_influence vassalization F-35s America_First mercenary_motives https://pinboard.in/ https://pinboard.in/u:jerryking/b:f70fb70674e1/ 2025-02-17T04:38:09+00:00 https://www.wsj.com/tech/the-rower-turned-engineer-who-helped-make-nvidia-a-3-trillion-company-99d72ecd?mod=hp_lead_pos3 jerryking>technology Cold War<< —with Chinese startups such as >>DeepSeek<< challenging industry leaders in the U.S. by using Nvidia’s made-for-China chips. U.S. officials grumble that the chips push the limit of >>export controls<<, undermining efforts to hobble Chinese AI advancement for military purposes. Nvidia says it follows the law........Those who know Alben say his success comes from diving into the technical weeds, **pushing the boundaries of rules** [i.e. = "rule-bending"] and echoing the ultra-competitive nature of his boss of 28 years, the leather-jacket-wearing Huang. One of dozens of executives who report directly to Huang, Alben leads some 1,000 engineers as the company’s longtime head of engineering for >>graphics processing units<<. Even in a Nvidia office with some of the smartest Ph.D.s, what stands out to his former and current colleagues is the intellect of Alben, who stopped at a master’s degree. Also impressive, they say, is his ability to manage that collection of brains. Rowing rules stated that coxswains weighing under 125 pounds had to make up the difference by carrying sandbags on the boat. But Alben, who tipped the scales at 117, didn’t want to carry an ounce more than necessary. So on race mornings, say teammates, he chugged 8 pounds of water—about one gallon. Then he held it in until weigh-in and, before the regatta started, urinated it all out....... Alben was at his best when technical challenges arose. One time, when a graphics chip in development wasn’t displaying movies properly, Alben met Ostojic and another co-worker to troubleshoot the issue. “Jonah just comes in and says, ‘Let’s just look into the code line-by-line,’” Ostojic said. “Jonah was driving the situation: What does this do? What does that do?” The three eventually solved the problem without triggering the worst-case scenario: a hardware fix. “If he makes a wrong move, he could set Nvidia back by six to 12 months,” .........The attention to technical details is also prized by Huang, a former table-tennis prodigy who has attended conferences simply to learn. His theory is that company executives must immerse themselves in leading-edge research to understand where the market is going.........Nvidia chips were originally designed to generate graphics in videogames and other programs. Then, in the early >>2010s<<, the company realized these kinds of chips were also ideal for training AI and solving new problems—which surprised even Alben. He said he remembered the >>moment<< when he realized the chips he was engineering had more potential than he ever >>imagined<<: He read a paper about a researcher using a graphics processing unit to simulate how the human nose smells. “There was no salesperson from Nvidia that had ever called up that researcher to try to sell a GPU to him for that,” Alben said in the podcast. “That has stuck with me as the first time I was like, OK, this isn’t just for the three problems that were listed on our to-do list.” +++++++++++++++++++++++++++++++++++++++ My late wife and I lived and worked in West Africa, Angola, Nigeria. She was Chevron I was a contractor to every body( Shell, Exxon, etc.). One Sunday morning outside of Port Harcourt Nigeria, a little Catholic church. The little Nigerian girls were fascinated with my wife's blonde hair and blue eyes. One of the little ones could not be (4) four years old, cute as a beagle puppy. She kept ducking and weaving, and dodging and wincing, always behind my wife's head. My wife finally asked what is she trying to do? Her older sister told my wife, that the little Nigerian girl was "trying to see through her eyes." [i.e. = "perspective-taking"] "What"? "She wants to know what the world looks like through blue eyes."[i.e. = "perspective-taking"] I have often wondered what the world looks like through some of these genius's eye's? +++++++++++++++++++++++++++++++++++++++ ]]> 2010s Aha!_moments artificial_intelligence China China_rising engineering export_controls GPUs imagination Jensen_Huang NVDIA problem_solving rowing rule-bending semiconductors Stanford troubleshooting unarticulated_desires unintended_consequences new_tech_Cold_War U.S.-China_relations repurposing reuse throttling chip_design DeepSeek different_perspectives perspective-taking https://pinboard.in/ https://pinboard.in/u:jerryking/b:ab6e8b5d4255/ 2025-02-12T17:18:54+00:00 https://www.wsj.com/world/china/chinas-xi-is-building-an-economic-fortress-against-u-s-pressure-53f6292d?mod=hp_trendingnow_article_pos2 jerryking Beijing chemicals China China_rising homegrown industrial_policies self-reliance self-sufficiency semiconductors shipbuilding Xi_Jinping apply_pressure https://pinboard.in/ https://pinboard.in/u:jerryking/b:6f842cb1ea66/ 2025-01-31T12:13:04+00:00 https://www.theglobeandmail.com/business/commentary/article-donald-trumps-brilliant-plan-to-make-china-great-again/ jerryking>Donald Trump<<’s goal to make America feared but friendless? He’s well on his way. >>Threats<< have their time and place in international relations. Between >>adversaries<<, a clear statement of threatening intent – **do not cross this line**, or else – can sometimes open the door to defusing conflict. If Washington and NATO had been clear about just how far they were willing to go in backing Ukraine, Russia’s invasion might not have happened. But menacing friends? And mocking them? It’s a relationship ender. You can’t punish your way to amity. You can’t abuse your way to comity. You can’t >>bully<< your way to trust. Mr. Trump campaigned on a promise to tackle the biggest strategic challenge for the United States, namely the rise of China, whose industrial strategies have delivered a “China shock” that has sapped industries in the U.S. and among allies. But since his election, Mr. Trump has not been taking care of business with the chief adversary. He’s mostly been going after the allies. Calling Canada the 51st state and threatening a >>trade war<< against this country is bad enough. But he’s levelled stronger demands at >>Denmark<<, even refusing to rule out using force to compel it to hand over Greenland. Denmark is, like Canada, a member of >>NATO<< – the U.S.-led military alliance whose members are pledged to defend one another against attack. Mr. Trump similarly refused to rule out using force to get Panama to surrender the >>Panama Canal<<. And instead of quietly negotiating with Colombia to allow U.S. military planes to continue to return deported Colombians, his administration seized the opportunity to make a great show of publicly punishing and >>humiliating<< a friendly country. Not only has Mr. Trump spent the past few months threatening tariffs on Canada, he’s been **insistently unclear** [i.e. = "opacity"/"strategic ambiguity"] on what he wants in return, or what, if anything, would prevent the tariffs. Appearing this week before the U.S. Senate, Howard Lutnick, the nominee for Commerce secretary, surprised when he said that Canada is in fact facing two volleys of tariffs – a possible 25% levy on Feb. 1, in response to allegedly insufficient Canadian action against (very low) levels of illegal immigration and fentanyl trafficking into the U.S., and a whole other suite of tariffs that could land as soon as April 1, after a study into unfair trading practices. On Thursday, Mr. Trump said the Feb. 1 tariff is definitely coming, and it “may or may not” include oil. It’s one thing to throw adversaries off balance [i.e. = "weaponizing uncertainty"]. Richard Nixon sometimes used the “>>madman theory<<” to try to cow the Soviet Union and North Vietnam, pitching himself as a temperamental lunatic prone to violent overreaction. But there’s no logic in convincing friends that you’re dangerously >>unstable<<. Not unless you want them to stop trusting you. As Senator Mark Warner said on Thursday, while questioning Tulsi Gabbard, Mr. Trump’s controversial nominee for director of national intelligence, her record of sympathizing with adversaries could deter long-time allies (NATO, the >>Five Eyes<< and others) from sharing intelligence with the U.S. That threatens relationships that he correctly characterized as “all based on trust.” The 19th century British prime minister >>Lord Palmerston<< said that countries have no permanent friends or enemies, only enduring >>interests<<. Regardless of who’s in the Oval Office, the president will pursue what he believes are his, and his country’s, interests. That’s why Mr. Trump pulled out of the Paris Agreement on climate change in his first term. That’s why Joe Biden rejoined. That’s why Mr. Trump has once again withdrawn. But standing up for one’s interests is a long way from opening hostilities against friends. Mr. Trump’s foreign policy so far is strangely preoccupied with the latter. He seems to believe that America suffers from the burdens of friendship. Friends are for >>suckers<<. Instead, he favours purely >>transactional relationships<<, while signalling that deals are always contingent and transitory, to be broken by either side the moment it suits them. But such agreements are in >>bad faith<<, and everyone knows it. Mr. Trump 1.0 called the United States-Mexico-Canada trade agreement the greatest trade deal, ever; Mr. Trump 2.0 is already ripping it up. If you signal that your commitments are not worth the price of a free-with-purchase cartridge of printer toner, your >>unfaithfulness<< will be repaid in kind. All this is a gift to >>Beijing.<< Canada and the European Union share Washington’s long-standing concerns about China, and their hope was that Mr. Trump would focus on diminishing the economic influence and power of America’s chief rival – an assignment best achieved by forming a >>united front<< of allies. Instead, he has spent the past couple of months preoccupied with threatening and belittling allies, and undermining alliances. How does that benefit Americans? It doesn’t.]]> China China_rising crossborder Donald_Trump tariffs threats Tony_Keller alliances Beijing adversaries bullying humiliation redlines territorial_expansion bad-faith Five_Eyes Lord_Palmerston national_interests NATO opacity strategic_ambiguity strategic_chaos sucker_plays transactional_relationships U.S.foreign_policy unfaithfulness united_front weaponizing_uncertainty Trump_2.0 own_goals Denmark madman_theory Panama_Canal trade_wars unstable https://pinboard.in/ https://pinboard.in/u:jerryking/b:a01fe5105378/ 2025-01-29T20:19:51+00:00 https://www.wsj.com/tech/ai/china-deepseek-ai-nvidia-openai-02bdbbce?mod=tech_more_article_pos13 jerryking artificial_intelligence China China_rising DeepSeek engineering export_controls human_ingenuity Nvidia start_ups outsmart https://pinboard.in/ https://pinboard.in/u:jerryking/b:6e2899992048/ 2025-01-18T22:27:29+00:00 https://www.wsj.com/world/in-a-new-age-of-empire-great-powers-aim-to-carve-up-the-planet-fef072f7?mod=hp_lead_pos8 jerryking dangerous_world EU great_powers imperialism law_of_the_jungle Monroe_Doctrine_of_1823 multilateral_institutions NATO post-Cold_War rules-based Russia Ukraine UN Vladimir_Putin multipolarity collective_will China U.S. post-WWII exerting_control spheres_of_influence https://pinboard.in/ https://pinboard.in/u:jerryking/b:36acf6b117c6/ 2025-01-13T05:50:21+00:00 https://www.wsj.com/opinion/beijings-espionage-campaign-against-the-west-treasury-department-breach-latest-example-3c6890fe?mod=business_trendingnow_opn_pos2&mod=hp_opin_pos_1 jerryking China China_rising data_breaches destabilization espionage implants security_&_intelligence Michael_Pompeo U.S.-China_relations https://pinboard.in/ https://pinboard.in/u:jerryking/b:d2c256cbbef9/ 2024-12-27T18:56:36+00:00 https://www.nytimes.com/2024/12/27/opinion/elon-musk-industrial-policy.html jerryking China batteries DARPA Elon_Musk loss_aversion public_investments risk-taking failure failure-tolerant failure_rates industrial_policies public_funding https://pinboard.in/ https://pinboard.in/u:jerryking/b:8af5c794cc32/ 2024-12-20T16:59:11+00:00 https://www.nytimes.com/2024/12/17/opinion/us-china-musk-swift-tariffs-manufacturing.html jerryking>China<< took a great leap forward in high-tech manufacturing of everything......>>Donald Trump<<'s relentless China-bashing and >>tariffs<< during his first term as president lit a fire under >>Beijing<< to double down on its efforts to gain global supremacy in >>electric cars<<, >>robots<< and rare materials, and to become as independent of America’s markets and tools as possible [i.e. = "self-reliance']........“China had its >>Sputnik moment<< — his name was Donald Trump,” ......“He woke them up to the fact that they needed an **all-hands-on-deck** [i.e. = "whole-of-society"] effort to take their >>indigenous<< scientific, innovative and advanced manufacturing skills to a new level.”........The China that Trump will encounter is a much more formidable export engine. Its advanced manufacturing muscles have exploded in size, sophistication and quantity in the last eight years, even while consumption by its people remains puny.....China’s export machine is so strong now that only very high tariffs might really slow it down, and China’s response to very high tariffs could be to start cutting off American industries from crucial supplies that are now available almost nowhere else. That kind of supply-chain warfare is not what anyone, anywhere needs.......Chinese experts would like to avoid that battle.....The Chinese still need the U.S. market for their exports. But they will not be pushovers. Both Beijing and Washington will be much better off with a bargain — one that imposes a gradual increase in U.S. tariffs, while both countries do what we needed to do long ago. What is that? I call it the “Elon Musk-Taylor Swift paradigm.” America would use higher tariffs on China to buy time to lift up more >>Elon Musks<< — more >>homegrown<< manufacturers who can make big stuff so we can >>export<< more to the world and import less. And China would use the time to let in more >>Taylor Swifts<< — more opportunities for its youth to spend money on entertainment and consumer goods made abroad, but also to make more goods and offer more services — particularly in health care — that its own people want to buy.....if we don’t use this time to respond to China the way we did to the Soviet Union’s 1957 launch of Sputnik [i.e. = "a "trigger event"], the world’s first artificial satellite, with our own comprehensive scientific, innovative and industrial push, we will be toast......a lot of people in Washington D.C. have missed the China's staggering manufacturing growth...........In 2000, “the U.S. and its allies in Asia, Europe and Latin America accounted for the overwhelming majority of global industrial production, with China at just 6% even after two decades of rapid growth.” By 2030, the U.N. agency predicts “China will account for 45% of all global manufacturing, single-handedly matching or outmatching the U.S. and all of its allies......In 2019, as Trump was finishing his last term, net lending by Chinese banks to domestic industries was $83 billion. In 2023, it swelled to $670 billion.....in 2019, before Covid, Xiaomi and Huawei were only Chinese smartphone companies. In late 2024, both were now also >>electric car<< companies — each leveraging its battery technologies to make really cool electric cars.......In an effort to export its large inventory of cars, China has begun construction of a fleet of 170 ships capable of carrying several thousand automobiles at a time across the ocean. Before the Covid-19 pandemic, the world’s shipyards were delivering only 4 such vessels a year......Trump has vowed to make America great again by doubling down on drill-baby-drill gas guzzlers and ending U.S. government subsidies for Americans who purchase electric cars......one day we’ll wake up and China will own the global electric vehicle market....Here’s another way the China that Trump will face in 2025 looks a lot different from his last go-round. If Trump were even to tell China, “Hey, I’ll let you off the hook on tariffs, if you build more factories in America,” that would definitely help reduce our trade deficit with Beijing, but it might not be such a vote-getter for Republicans. Because here is what China would say: “Sure, how many factories would you like? Forty? Fifty? But there’s one thing. The assembly lines will all be staffed by robots, and we can even operate them remotely.”[i.e. = "dark factories"]....Dark factories, also called smart factories, are entirely run by programmed robots with no need for lighting......there is another reason for China’s headlong rush to robotization: demographic necessity......In his first term, Trump — and Biden, too — was right to impose tariffs on China as long as it didn’t give us reciprocal access. China has consistently violated World Trade Organization trade rules to avoid giving reciprocal **access** [i.e. = "market access"] to its major trading partners, and it has greatly subsidized its companies. I have complained about this for years.....here’s what’s scary: We no longer make that many things China wants to buy. It can do almost everything at least cheaper and often better......Eric Chen is the founder of Kingwills, a Chinese >>materials<< science company that competes with, among others, DuPont. He explained to me that what young Chinese entrepreneurs like himself learned from the Chinese internet giants like Tencent, ByteDance and Alibaba was “rapid innovation and improvement.” His foreign competitors, said Chen, **upgrade their products much more slowly** [i.e. = "upgrade cycles"] and, when they do, can take five or six years to build a new factory. “We upgrade some products every 30 days. We can produce a new production line in six months. We learned from Elon Musk and Steve Jobs. You are really good” at taking products “from zero to 1. We are good at going from 2 to 100."[i.e. = "blitzscaling"/ "scaling"].....This is possible because the steady buildup of manufacturing capacity in China means that virtually anything you need today — from a tiny part to a rare earth chemical — can be sourced domestically. No other country in the world has such a complete homegrown ecosystem......Kingwills has a three-year target to have zero labor for production and storage using a combination of robots and A.I.” Then “we can sit in China and control production outside of China. Then we can put factories closer to the customer.”........“Probably in the future the competition for the U.S. is not China, but A.I. It is coming for both countries.”..........Foreign business executives operating in China will tell you that you used to have to be there to have **access** to its giant market of consumers. You still have to be there, they say, but today it’s also in order to have **access** to China’s expanding market of innovators. Get ready for more “designed in China,” not just “made in China.” We fool ourselves if we believe that China’s growing strength in advanced manufacturing is only from unfair trade practices. It is also because it has lots and lots of people still burning to work, as they say, “9-9-6” — that is 9 a.m. to 9 p.m. 6 days a week to make a better life, and because Beijing has invested in world-class infrastructure, and because it deliberately suppresses consumer spending and because it has a seemingly endless supply of students majoring in engineering — and not so many in sports management, sociology and gender studies. “The Chinese treat education like we treat sports,” So, China’s going to bury America? That is not at all inevitable. Friedman left as impressed with China’s weaknesses as much as with its strengths......in the relative absence of foreign visitors, a lot of Chinese have grown out of touch with how China is perceived in the world......China “freaked out” the rest of the world when it began its “Made in China 2025” agenda.... China has billions and billions of dollars in domestic savings that could stimulate its economy, but people will spend those savings only if they have confidence in their government and faith in the future.....the government’s prioritizing of Communist Party ideology and state-owned industries is driving some of China’s most talented private-sector innovators to quietly move their money, families or themselves to Japan, Dubai and Singapore..........My free advice to my friends in China is that an economy this unbalanced is not sustainable. It will eventually generate a global trade alliance against them............As for my neighbors in America, I have a confession. I caught a virus in China that I never imagined I’d get: “Elon Musk appreciation.” .Elon Musk in China is regarded as this genius engineer-entrepreneur who can make stuff, big stuff — electric cars, reusable rockets and satellite internet systems — as well as anyone in China can, and often better.......Elon Musk at his best, though, is the one American manufacturer the Chinese fear and respect. It is crazy to me that Trump is wasting Musk on the project of shrinking the U.S. bureaucracy — under the acronym DOGE, for the informal “Department of Government Efficiency” — when he should be leading another DOGE, a government office for enabling more Americans to “Do Good Engineering.”.......In sum, America needs to tighten up, but China needs to loosen up. ]]> artificial_intelligence Beijing blitzscaling BYD China China_rising critical_minerals dark_factories demographic_changes DOGE domination ecosystems electric_cars Elon_Musk exporting homegrown Huawei indigenous innovators manufacturers market_dominance materials monozukuri product_cycles outsized rare_earth_metals robotics scaling self-reliance Sputnik supply_chains tariffs Taylor_Swift Tom_Friedman trigger_events U.S.-China_relations upgrade_cycles Washington_D.C. whole-of-society WTO Xiaomi market_access innovation_cycles people-less https://pinboard.in/ https://pinboard.in/u:jerryking/b:41d399b48419/