It is past time to write off the digital revolution as a huge mistake
Paul Craig Roberts
Some time ago I warned about the unsustainable over investment in AI data centers. Each of the AI corporations is dependent on commitment from other AI corporations. One was dependent on a purchase dependent on the purchaser securing funding depending on the funding source’s acquisitions or service sales, and so on. It is a circle that can break at any point. Now Bloomberg reports “The sudden plunge in demand for a Nvidia-backed data center company’s initial public offering is revealing fresh cracks in the AI funding boom.”
Moreover, AI is socially and economically destructive as it makes human labor valueless instead of elevating it to higher productivity as the mechanical revolution did. Trillions of dollars in investment capital are being pumped into making human labor valueless. That people invest in such destructive enterprises demonstrates the rise of a new stupidity previously unknown in human history.
As the value of human labor declines, where is the demand for goods and services? This question appears to be over the heads of US corporations, boards, and academic economists.
The digital revolution was a fundamental mistake. Over the last few months the cost in time and frustration of using the Internet and dealing with service providers has doubled. This is because the Internet is an open system in which security can never exist. The fruitless struggle for security requires more and more authentications and results in more and more incompatibilities in security mechanisms. This is a losing game. Why are we paying trillions of dollars for it?