March 2017

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“The most effective way of making everybody serve the single system of ends toward which the social plan is directed is to make everybody believe in those ends. To make a totalitarian system function efficiently, it is not enough that everybody should be forced to work for the same ends. It is essential that the people should come to regard them as their own ends.”[p.171]

Berit’s comment: Ponder that statement. It helps explain the significance of universal service-learning. Like socialist youth in Nazi (National Socialism) and Communist countries, all must embrace the new ideology. Those who don’t — the intolerable dissenters — must be silenced. The next section elaborates:

“Although the beliefs must be chosen for the people and imposed upon them, they must become their beliefs, a generally accepted creed which makes the individuals as far as possible act spontaneously in the way the planner wants. If the feeling of oppression in totalitarian countries is in general much less acute than most people in liberal countries imagine, this is because the totalitarian governments succeed to a high degree in making people think as they want them to.”[p.171]

 The strategies that accomplish this mental change include numerous subtle and obvious forms of propaganda. Schools, the media, children- and youth-service teams, corporations, etc…. every source of propaganda must share the same vision. Though totalitarian, it will be designed to sound noble, compassionate and fair to all. Yet the result with be the exact opposite.

Ponder this warning from Dr. Thomas Sowell‘s review of Road to Serfdom:


“At the heart of the socialist vision is the notion that a compassionate society can create more humane living conditions for all through government ‘planning’ and control of the economy….


“The rule of law, on which freedom itself ultimately depends, is inherently incompatible with socialism. People who are free to do as they wish will not do as the economic planners wish. Differences in values and priories are enough to ensure that. These differences must be ironed out by propaganda or power, if socialism is to be socialism. Indoctrination must be part of the program, not because socialist want to be brainwashers, but because socialism requires brainwashing.


Idealist socialist create systems in which idealist are almost certain to lose and be superseded by those whose drive for power, and ruthlessness in achieving it, make them the “fittest” to survive under a system where government power is the ultimate prize.… The issue is not what anyone intends but what consequences are in fact likely to follow.”[39]


In his article, aptly titled “A Road to Hell Paved with Good Intentions,” Sowell points out that “Marxism as an ideal continues to flourish on American college campuses, as perhaps nowhere else in the world.” Collectivist visions appeal to academic idealists and others who ignore the lessons of history.

“….all propaganda serves the same goal—that all the instruments of propaganda are coordinated to influence the individuals in the same direction…. The skillful propagandist then has power to mold their minds in any direction he chooses, and even the most intelligent and independent people cannot entirely escape that influence if they are long isolated from all other sources of information. [p.171-172]

President Obama is now taking control of this change process by transferring workers from the private sector (corporations, private enterprise…) to the government service sector. With the controlled media on his side, the masses are not exposed to contrary facts.

“…even the striving for equality by means of a directed economy can result only in an officially enforced inequality—an authoritarian determination of the status of each individual in the new hierarchical order—and that most of the humanitarian elements of our morals, the respect for human life, for the weak, and for the individual generally, will disappear….

“The moral consequences of totalitarian propaganda which we must now consider are, however, of an even more profound kind. They are destructive of all morals because they undermine one of the foundations of all morals: the sense of and the respect for truth.

“…in order to induce people to accept the official values, these must be justified, or shown to be connected with the values already held by the people, which usually will involve assertions about causal connections between means and ends.  …people must be brought to agree not only with the ultimate aims but also with the views about the facts and possibilities on which the particular measures are based.[p.172]

Al Gore’s battle against a mythical man-made global warming crisis illustrates this point. Globalist change agents agree that a worldwide crisis is needed to persuade humanity to embrace all the costly restrictions and regulations of government controlled “sustainable development.” So they are willing to ignore facts and embrace myths and pseudo-science in order to reach their goal.

“We have seen that agreement on that complete ethical code, that all-comprehensive system of values which is implicit in an economic plan, does not exist in a free society but would have to be created….

“And while the planning authority will constantly have to decide issues on merits about which there exist no definite moral rules [apart from the Bible], it will have to justify its decisions to the people—or, at least, have somehow to make the people believe that they are the right decisions….

“This process of creating a ‘myth’ to justify his action need not be conscious. …  So [the totalitarian leader] will readily embrace theories which seem to provide a rational justification for the prejudices which he shares with many of his fellows. Thus a pseudoscientific theory becomes part of the official creed which to a greater or lesser degree directs everybody’s action. [p.173]

“The need for such official doctrines… has been clearly foreseen by the various theoreticians of the totalitarian system…. They are all necessarily based on particular views about facts which are thenelaborated into scientific theories in order to justify a preconceived opinion.

“The most effective way of making people accept the validity of the values they are to serve is to persuade them that they are really the same as those which they… have always held, but which were not properly understood or recognized…. The people are made to transfer their allegiance from the old gods to the new under the pretense that the new gods really are what their sound instinct had always told them but what before they had only dimly seen. And the most efficient technique to this end is to use the old words but change their meaning. Few traits of totalitarian regimes are … so characteristic of the whole intellectual climate as the complete perversion of language….

“The worst sufferer in this respect is, of course, the word ‘liberty.’ It is a word used as freely in totalitarian states as elsewhere…. Dr. Karl Mannheim… warns us that ‘a conception of freedom modeled on the preceding age is an obstacle to any real understanding of the problem. But his use of the word freedom is as misleading it is in the mouth of totalitarian politicians. Like their freedom, the ‘collective freedom‘ he offers us is not the freedom of the members of society but the unlimited freedom of the planner to do with society what he pleases….[pps.174-175]

“In this particular case the perversion of the meaning of the word has, of course, been well prepared …. by many of the theoreticians of socialism. But ‘freedom’ or ‘liberty’ are by no means the only words whose meaning has been changed into their opposites to make them serve as instruments of totalitarian propaganda. We have already seen how the same happens to ‘justice’ and “law,’ ‘right’ and ‘equality.’ The list could be extended until it includes almost all moral and political terms in general use.

“… the confusion becomes worse because this change of meaning of the words describing political ideals is not a single event but a continuous process, a technique employed consciously or unconsciously to direct the people….

“It is not difficult to deprive the great majority of independent thought. But the minority who will retain an inclination to criticize must also be silenced. … Since many parts of this code will never be explicitly stated… every act of the government, must become sacrosanct and exempt from criticism. If the people are to support the common effort without hesitation, they must be convinced that not only the end aimed at but also the means chosen are the right ones.”[p.175]

Facts and theories must thus become no less the object of an official doctrine than views about values. And the whole apparatus for spreading knowledge—the schools and the press, radio and motion picture—will be used exclusively of to spread those views which, whether true or false, will strengthen the belief in the rightness of the decisions taken by the authority; and all information that might cause doubt or hesitation will be withheld.”[p.176]

Stanford University Professor Steven Schneider illustrates it well. He said,

“On the one hand, as scientists, we are ethically bound to the scientific method, in effect promising to tell the truth, the whole truth, and nothing but–which means that we must include all the doubts, the caveats, the ifs, ands, and buts. On the other hand, we are not just scientists but human beings as well. And like most people, we’d like to see the world a better place, which in this context translates into our working to reduce the risk of potentially disastrous climatic change.
“To do that, we need to get some broad based support, to capture the public’s imagination. That, of course, entails getting loads of media coverage. So we have to offer up scary scenarios, make simplified, dramatic statements and make little mention of any doubts we might have… Each of us has to decide what the right balance is between being effective and being honest.” (See endnote #38 in Saving the Earth)

This applies even to fields apparently most remote from any political interests and particularly to all the sciences, even the most abstract. That in the disciplines dealing directly with human affairs and therefore most immediately affecting political views, such as history, law or economics, the disinterested search for truth cannot be allowed…. These disciplines have, indeed, in all totalitarian countries become the most fertile factories of the official myths which the rulers use to guide the minds and wills of their subjects….” [p.176]

n “Government religion in the United States,” Erica Carle wrote:
“The separation of church and state argument for removing all traces of Biblical teaching from public life and public land is a gigantic fraud. Why? Because there is no separation of church and state. Government religion is a fact in the United States. What is wanted by the government religion adherents is not separation of church and state, but exclusive rights for their religion.”What is the government religion? Auguste Comte (1798-1857), its French founder, called it the Religion of Humanity. The doctrines of the Positive Religion are now taught in the schools as a science which Comte called sociology. Sociology was to be the ruler science over all the other sciences and also the science of managing the world…. In a country that is supposed to be free,

  • its citizens are being subjected to sociological management,
  • its scientists and elected officials to sociological control, and
  • its youth to sociological education.

“…we must yet be on our a guard not to dismiss .[these aberrations] as mere accidental by-products which have nothing to do with the essential character of a planned or totalitarian system….They are a direct result of that same desire to see everything directed by a ‘unitary conception of the whole.’…


“Once science has to serve, not truth, but the interests of a class, a community or a state…. As the Nazi minister of justice has explained, the question which every new scientific theory must ask itself is: ‘Do I serve National Socialism for the greatest benefit of all?’
The word ‘truth’ itself ceases to have its old meaning.  …it becomes something to be laid down by authority, something which has to be believed in the interest of the unity of the organized effort and which may have to be altered as the exigencies of this organized effort require it.
“The general intellectual climate which this produces, the spirit of complete cynicism as regards truth which it engenders, the loss of the sense of even the meaning of truth, the disappearance of the spirit of independent inquiry…. Perhaps the most alarming fact is that contempt for intellectual liberty is not a thing which arises only once the totalitarian system is established but one which can be found everywhere among intellectuals who have embraced a collectivist faith and who are acclaimed as intellectual leaders even in countries still under a liberal regime.


“Not only is even the worst oppression condoned if it is committed in the name of socialism, and the creation of a totalitarian system openly advocated by people who pretend to speak for the scientists of liberal countries; intolerance, too, is openly extolled….” [p.178]

“This view is, of course, practically indistinguishable from the views which led the Nazis to the persecution of men of science, the burning of scientific books, and the systematic eradication of the intelligentsia of the subjected people.

“The desire to force upon the people a creed which is regarded as salutary for them is, of course, not a thing that is new or peculiar to our time. New, however, is the argument by which many of our intellectuals try to justify such attempts.” [p.179]
The tragedy of collectivist thought is that, while it starts out to make reason supreme, it ends by destroying reason….”[p.180]

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It was just a friendly little argument about the fate of humanity. Demis Hassabis, a leading creator of advanced artificial intelligence, was chatting with Elon Musk, a leading doomsayer, about the perils of artificial intelligence.

They are two of the most consequential and intriguing men in Silicon Valley who don’t live there. Hassabis, a co-founder of the mysterious London laboratory DeepMind, had come to Musk’s SpaceX rocket factory, outside Los Angeles, a few years ago. They were in the canteen, talking, as a massive rocket part traversed overhead. Musk explained that his ultimate goal at SpaceX was the most important project in the world: interplanetary colonization.

Hassabis replied that, in fact, he was working on the most important project in the world: developing artificial super-intelligence. Musk countered that this was one reason we needed to colonize Mars—so that we’ll have a bolt-hole if A.I. goes rogue and turns on humanity. Amused, Hassabis said that A.I. would simply follow humans to Mars.

This did nothing to soothe Musk’s anxieties (even though he says there are scenarios where A.I. wouldn’t follow).

An unassuming but competitive 40-year-old, Hassabis is regarded as the Merlin who will likely help conjure our A.I. children. The field of A.I. is rapidly developing but still far from the powerful, self-evolving software that haunts Musk. Facebook uses A.I. for targeted advertising, photo tagging, and curated news feeds. Microsoft and Apple use A.I. to power their digital assistants, Cortana and Siri. Google’s search engine from the beginning has been dependent on A.I. All of these small advances are part of the chase to eventually create flexible, self-teaching A.I. that will mirror human learning.

Some in Silicon Valley were intrigued to learn that Hassabis, a skilled chess player and former video-game designer, once came up with a game called Evil Genius, featuring a malevolent scientist who creates a doomsday device to achieve world domination. Peter Thiel, the billionaire venture capitalist and Donald Trump adviser who co-founded PayPal with Musk and others—and who in December helped gather skeptical Silicon Valley titans, including Musk, for a meeting with the president-elect—told me a story about an investor in DeepMind who joked as he left a meeting that he ought to shoot Hassabis on the spot, because it was the last chance to save the human race.

Elon Musk began warning about the possibility of A.I. running amok three years ago. It probably hadn’t eased his mind when one of Hassabis’s partners in DeepMind, Shane Legg, stated flatly, “I think human extinction will probably occur, and technology will likely play a part in this.”

Before DeepMind was gobbled up by Google, in 2014, as part of its A.I. shopping spree, Musk had been an investor in the company. He told me that his involvement was not about a return on his money but rather to keep a wary eye on the arc of A.I.: “It gave me more visibility into the rate at which things were improving, and I think they’re really improving at an accelerating rate, far faster than people realize. Mostly because in everyday life you don’t see robots walking around. Maybe your Roomba or something. But Roombas aren’t going to take over the world.”

In a startling public reproach to his friends and fellow techies, Musk warned that they could be creating the means of their own destruction. He told Bloomberg’s Ashlee Vance, the author of the biography Elon Musk, that he was afraid that his friend Larry Page, a co-founder of Google and now the C.E.O. of its parent company, Alphabet, could have perfectly good intentions but still “produce something evil by accident”—including, possibly, “a fleet of artificial intelligence-enhanced robots capable of destroying mankind.”

the World Government Summit in Dubai, in February, Musk again cued the scary organ music, evoking the plots of classic horror stories when he noted that “sometimes what will happen is a scientist will get so engrossed in their work that they don’t really realize the ramifications of what they’re doing.” He said that the way to escape human obsolescence, in the end, may be by “having some sort of merger of biological intelligence and machine intelligence.” This Vulcan mind-meld could involve something called a neural lace—an injectable mesh that would literally hardwire your brain to communicate directly with computers. “We’re already cyborgs,” Musk told me in February. “Your phone and your computer are extensions of you, but the interface is through finger movements or speech, which are very slow.” With a neural lace inside your skull you would flash data from your brain, wirelessly, to your digital devices or to virtually unlimited computing power in the cloud. “For a meaningful partial-brain interface, I think we’re roughly four or five years away.”

Musk’s alarming views on the dangers of A.I. first went viral after he spoke at M.I.T. in 2014—speculating (pre-Trump) that A.I. was probably humanity’s “biggest existential threat.” He added that he was increasingly inclined to think there should be some national or international regulatory oversight—anathema to Silicon Valley—“to make sure that we don’t do something very foolish.” He went on: “With artificial intelligence, we are summoning the demon. You know all those stories where there’s the guy with the pentagram and the holy water and he’s like, yeah, he’s sure he can control the demon? Doesn’t work out.” Some A.I. engineers found Musk’s theatricality so absurdly amusing that they began echoing it. When they would return to the lab after a break, they’d say, “O.K., let’s get back to work summoning.”

Musk wasn’t laughing. “Elon’s crusade” (as one of his friends and fellow tech big shots calls it) against unfettered A.I. had begun.

Elon Musk smiled when I mentioned to him that he comes across as something of an Ayn Rand-ian hero. “I have heard that before,” he said in his slight South African accent. “She obviously has a fairly extreme set of views, but she has some good points in there.”

But Ayn Rand would do some re-writes on Elon Musk. She would make his eyes gray and his face more gaunt. She would refashion his public demeanor to be less droll, and she would not countenance his goofy giggle. She would certainly get rid of all his nonsense about the “collective” good. She would find great material in the 45-year-old’s complicated personal life: his first wife, the fantasy writer Justine Musk, and their five sons (one set of twins, one of triplets), and his much younger second wife, the British actress Talulah Riley, who played the boring Bennet sister in the Keira Knightley version of Pride & Prejudice. Riley and Musk were married, divorced, and then re-married. They are now divorced again. Last fall, Musk tweeted that Talulah “does a great job playing a deadly sexbot” on HBO’s Westworld, adding a smiley-face emoticon. It’s hard for mere mortal women to maintain a relationship with someone as insanely obsessed with work as Musk.

“How much time does a woman want a week?” he asked Ashlee Vance. “Maybe ten hours? That’s kind of the minimum?”

Mostly, Rand would savor Musk, a hyper-logical, risk-loving industrialist. He enjoys costume parties, wing-walking, and Japanese steampunk extravaganzas. Robert Downey Jr. used Musk as a model for Iron Man. Marc Mathieu, the chief marketing officer of Samsung USA, who has gone fly-fishing in Iceland with Musk, calls him “a cross between Steve Jobs and Jules Verne.”As they danced at their wedding reception, Justine later recalled, Musk informed her, “I am the alpha in this relationship.”

a tech universe full of skinny guys in hoodies—whipping up bots that will chat with you and apps that can study a photo of a dog and tell you what breed it is—Musk is a throwback to Henry Ford and Hank Rearden. In Atlas Shrugged, Rearden gives his wife a bracelet made from the first batch of his revolutionary metal, as though it were made of diamonds. Musk has a chunk of one of his rockets mounted on the wall of his Bel Air house, like a work of art.

Musk shoots for the moon—literally. He launches cost-efficient rockets into space and hopes to eventually inhabit the Red Planet. In February he announced plans to send two space tourists on a flight around the moon as early as next year. He creates sleek batteries that could lead to a world powered by cheap solar energy. He forges gleaming steel into sensuous Tesla electric cars with such elegant lines that even the nitpicking Steve Jobs would have been hard-pressed to find fault. He wants to save time as well as humanity: he dreamed up the Hyperloop, an electromagnetic bullet train in a tube, which may one day whoosh travelers between L.A. and San Francisco at 700 miles per hour. When Musk visited secretary of defense Ashton Carter last summer, he mischievously tweeted that he was at the Pentagon to talk about designing a Tony Stark-style “flying metal suit.” Sitting in traffic in L.A. in December, getting bored and frustrated, he tweeted about creating the Boring Company to dig tunnels under the city to rescue the populace from “soul-destroying traffic.” By January, according to Bloomberg Businessweek, Musk had assigned a senior SpaceX engineer to oversee the plan and had started digging his first test hole. His sometimes quixotic efforts to save the world have inspired a parody twitter account, “Bored Elon Musk,” where a faux Musk spouts off wacky ideas such as “Oxford commas as a service” and “bunches of bananas genetically engineered” so that the bananas ripen one at a time.

Of course, big dreamers have big stumbles. Some SpaceX rockets have blown up, and last June a driver was killed in a self-driving Tesla whose sensors failed to notice the tractor-trailer crossing its path. (An investigation by the National Highway Traffic Safety Administration found that Tesla’s Autopilot system was not to blame.)

Musk is stoic about setbacks but all too conscious of nightmare scenarios. His views reflect a dictum from Atlas Shrugged: “Man has the power to act as his own destroyer—and that is the way he has acted through most of his history.” As he told me, “we are the first species capable of self-annihilation.”

Here’s the nagging thought you can’t escape as you drive around from glass box to glass box in Silicon Valley: the Lords of the Cloud love to yammer about turning the world into a better place as they churn out new algorithms, apps, and inventions that, it is claimed, will make our lives easier, healthier, funnier, closer, cooler, longer, and kinder to the planet. And yet there’s a creepy feeling underneath it all, a sense that we’re the mice in their experiments, that they regard us humans as Betamaxes or eight-tracks, old technology that will soon be discarded so that they can get on to enjoying their sleek new world. Many people there have accepted this future: we’ll live to be 150 years old, but we’ll have machine overlords.

Maybe we already have overlords. As Musk slyly told Recode’s annual Code Conference last year in Rancho Palos Verdes, California, we could already be playthings in a simulated-reality world run by an advanced civilization. Reportedly, two Silicon Valley billionaires are working on an algorithm to break us out of the Matrix.

Among the engineers lured by the sweetness of solving the next problem, the prevailing attitude is that empires fall, societies change, and we are marching toward the inevitable phase ahead. They argue not about “whether” but rather about “how close” we are to replicating, and improving on, ourselves. Sam Altman, the 31-year-old president of Y Combinator, the Valley’s top start-up accelerator, believes humanity is on the brink of such invention.

“The hard part of standing on an exponential curve is: when you look backwards, it looks flat, and when you look forward, it looks vertical,” he told me. “And it’s very hard to calibrate how much you are moving because it always looks the same.”

You’d think that anytime Musk, Stephen Hawking, and Bill Gates are all raising the same warning about A.I.—as all of them are—it would be a 10-alarm fire. But, for a long time, the fog of fatalism over the Bay Area was thick. Musk’s crusade was viewed as Sisyphean at best and Luddite at worst. The paradox is this: Many tech oligarchs see everything they are doing to help us, and all their benevolent manifestos, as streetlamps on the road to a future where, as Steve Wozniak says, humans are the family pets.

But Musk is not going gently. He plans on fighting this with every fiber of his carbon-based being. Musk and Altman have founded OpenAI, a billion-dollar nonprofit company, to work for safer artificial intelligence. I sat down with the two men when their new venture had only a handful of young engineers and a makeshift office, an apartment in San Francisco’s Mission District that belongs to Greg Brockman, OpenAI’s 28-year-old co-founder and chief technology officer. When I went back recently, to talk with Brockman and Ilya Sutskever, the company’s 30-year-old research director (and also a co-founder), OpenAI had moved into an airy office nearby with a robot, the usual complement of snacks, and 50 full-time employees. (Another 10 to 30 are on the way.)

Altman, in gray T-shirt and jeans, is all wiry, pale intensity. Musk’s fervor is masked by his diffident manner and rosy countenance. His eyes are green or blue, depending on the light, and his lips are plum red. He has an aura of command while retaining a trace of the gawky, lonely South African teenager who immigrated to Canada by himself at the age of 17.

In Silicon Valley, a lunchtime meeting does not necessarily involve that mundane fuel known as food. Younger coders are too absorbed in algorithms to linger over meals. Some just chug Soylent. Older ones are so obsessed with immortality that sometimes they’re just washing down health pills with almond milk.

At first blush, OpenAI seemed like a bantamweight vanity project, a bunch of brainy kids in a walkup apartment taking on the multi-billion-dollar efforts at Google, Facebook, and other companies which employ the world’s leading A.I. experts. But then, playing a well-heeled David to Goliath is Musk’s specialty, and he always does it with style—and some useful sensationalism.

Let others in Silicon Valley focus on their I.P.O. price and ridding San Francisco of what they regard as its unsightly homeless population. Musk has larger aims, like ending global warming and dying on Mars (just not, he says, on impact).

Musk began to see man’s fate in the galaxy as his personal obligation three decades ago, when as a teenager he had a full-blown existential crisis. Musk told me that The Hitchhiker’s Guide to the Galaxy, by Douglas Adams, was a turning point for him. The book is about aliens destroying the earth to make way for a hyperspace highway and features Marvin the Paranoid Android and a supercomputer designed to answer all the mysteries of the universe. (Musk slipped at least one reference to the book into the software of the Tesla Model S.) As a teenager, Vance writes in his biography, Musk formulated a mission statement for himself: “The only thing that makes sense to do is strive for greater collective enlightenment.”

OpenAI got under way with a vague mandate—which isn’t surprising, given that people in the field are still arguing over what form A.I. will take, what it will be able to do, and what can be done about it. So far, public policy on A.I. is strangely undetermined and software is largely unregulated. The Federal Aviation Administration oversees drones, the Securities and Exchange Commission oversees automated financial trading, and the Department of Transportation has begun to oversee self-driving cars.

Musk believes that it is better to try to get super-A.I. first and distribute the technology to the world than to allow the algorithms to be concealed and concentrated in the hands of tech or government elites—even when the tech elites happen to be his own friends, people such as Google founders Larry Page and Sergey Brin. “I’ve had many conversations with Larry about A.I. and robotics—many, many,” Musk told me. “And some of them have gotten quite heated. You know, I think it’s not just Larry, but there are many futurists who feel a certain inevitability or fatalism about robots, where we’d have some sort of peripheral role. The phrase used is ‘We are the biological boot-loader for digital super-intelligence.’ ” (A boot loader is the small program that launches the operating system when you first turn on your computer.) “Matter can’t organize itself into a chip,” Musk explained. “But it can organize itself into a biological entity that gets increasingly sophisticated and ultimately can create the chip.”

Musk has no intention of being a boot loader. Page and Brin see themselves as forces for good, but Musk says the issue goes far beyond the motivations of a handful of Silicon Valley executives.

Ater the so-called A.I. winter—the broad, commercial failure in the late 80s of an early A.I. technology that wasn’t up to snuff—artificial intelligence got a reputation as snake oil. Now it’s the hot thing again in this go-go era in the Valley. Greg Brockman, of OpenAI, believes the next decade will be all about A.I., with everyone throwing money at the small number of “wizards” who know the A.I. “incantations.” Guys who got rich writing code to solve banal problems like how to pay a stranger for stuff online now contemplate a vertiginous world where they are the creators of a new reality and perhaps a new species.

Microsoft’s Jaron Lanier, the dreadlocked computer scientist known as the father of virtual reality, gave me his view as to why the digerati find the “science-fiction fantasy” of A.I. so tantalizing: “It’s saying, ‘Oh, you digital techy people, you’re like gods; you’re creating life; you’re transforming reality.’ There’s a tremendous narcissism in it that we’re the people who can do it. No one else. The Pope can’t do it. The president can’t do it. No one else can do it. We are the masters of it . . . . The software we’re building is our immortality.” This kind of God-like ambition isn’t new, he adds. “I read about it once in a story about a golden calf.” He shook his head. “Don’t get high on your own supply, you know?”

Google has gobbled up almost every interesting robotics and machine-learning company over the last few years. It bought DeepMind for $650 million, reportedly beating out Facebook, and built the Google Brain team to work on A.I. It hired Geoffrey Hinton, a British pioneer in artificial neural networks; and Ray Kurzweil, the eccentric futurist who has predicted that we are only 28 years away from the Rapture-like “Singularity”—the moment when the spiraling capabilities of self-improving artificial super-intelligence will far exceed human intelligence, and human beings will merge with A.I. to create the “god-like” hybrid beings of the future.

It’s in Larry Page’s blood and Google’s DNA to believe that A.I. is the company’s inevitable destiny—think of that destiny as you will. (“If evil A.I. lights up,” Ashlee Vance told me, “it will light up first at Google.”) If Google could get computers to master search when search was the most important problem in the world, then presumably it can get computers to do everything else. In March of last year, Silicon Valley gulped when a fabled South Korean player of the world’s most complex board game, Go, was beaten in Seoul by DeepMind’s AlphaGo. Hassabis, who has said he is running an Apollo program for A.I., called it a “historic moment” and admitted that even he was surprised it happened so quickly. “I’ve always hoped that A.I. could help us discover completely new ideas in complex scientific domains,” Hassabis told me in February. “This might be one of the first glimpses of that kind of creativity.” More recently, AlphaGo played 60 games online against top Go players in China, Japan, and Korea—and emerged with a record of 60–0. In January, in another shock to the system, an A.I. program showed that it could bluff. Libratus, built by two Carnegie Mellon researchers, was able to crush top poker players at Texas Hold ‘Em.

Peter Thiel told me about a friend of his who says that the only reason people tolerate Silicon Valley is that no one there seems to be having any sex or any fun. But there are reports of sex robots on the way that come with apps that can control their moods and even have a pulse. The Valley is skittish when it comes to female sex robots—an obsession in Japan—because of its notoriously male-dominated culture and its much-publicized issues with sexual harassment and discrimination. But when I asked Musk about this, he replied matter-of-factly, “Sex robots? I think those are quite likely.”

Wether sincere or a shrewd P.R. move, Hassabis made it a condition of the Google acquisition that Google and DeepMind establish a joint A.I. ethics board. At the time, three years ago, forming an ethics board was seen as a precocious move, as if to imply that Hassabis was on the verge of achieving true A.I. Now, not so much. Last June, a researcher at DeepMind co-authored a paper outlining a way to design a “big red button” that could be used as a kill switch to stop A.I. from inflicting harm.

Google executives say Larry Page’s view on A.I. is shaped by his frustration about how many systems are sub-optimal—from systems that book trips to systems that price crops. He believes that A.I. will improve people’s lives and has said that, when human needs are more easily met, people will “have more time with their family or to pursue their own interests.” Especially when a robot throws them out of work.

Musk is a friend of Page’s. He attended Page’s wedding and sometimes stays at his house when he’s in the San Francisco area. “It’s not worth having a house for one or two nights a week,” the 99th-richest man in the world explained to me. At times, Musk has expressed concern that Page may be naïve about how A.I. could play out. If Page is inclined toward the philosophy that machines are only as good or bad as the people creating them, Musk firmly disagrees. Some at Google—perhaps annoyed that Musk is, in essence, pointing a finger at them for rushing ahead willy-nilly—dismiss his dystopic take as a cinematic cliché. Eric Schmidt, the executive chairman of Google’s parent company, put it this way: “Robots are invented. Countries arm them. An evil dictator turns the robots on humans, and all humans will be killed. Sounds like a movie to me.”

Some in Silicon Valley argue that Musk is interested less in saving the world than in buffing his brand, and that he is exploiting a deeply rooted conflict: the one between man and machine, and our fear that the creation will turn against us. They gripe that his epic good-versus-evil story line is about luring talent at discount rates and incubating his own A.I. software for cars and rockets. It’s certainly true that the Bay Area has always had a healthy respect for making a buck. As Sam Spade said in The Maltese Falcon, “Most things in San Francisco can be bought, or taken.”

Musk is without doubt a dazzling salesman. Who better than a guardian of human welfare to sell you your new, self-driving Tesla? Andrew Ng—the chief scientist at Baidu, known as China’s Google—based in Sunnyvale, California, writes off Musk’s Manichaean throwdown as “marketing genius.” “At the height of the recession, he persuaded the U.S. government to help him build an electric sports car,” Ng recalled, incredulous. The Stanford professor is married to a robotics expert, issued a robot-themed engagement announcement, and keeps a “Trust the Robot” black jacket hanging on the back of his chair. He thinks people who worry about A.I. going rogue are distracted by “phantoms,” and regards getting alarmed now as akin to worrying about overpopulation on Mars before we populate it. “And I think it’s fascinating,” he said about Musk in particular, “that in a rather short period of time he’s inserted himself into the conversation on A.I. I think he sees accurately that A.I. is going to create tremendous amounts of value.”

Although he once called Musk a “sci-fi version of P. T. Barnum,” Ashlee Vance thinks that Musk’s concern about A.I. is genuine, even if what he can actually do about it is unclear. “His wife, Talulah, told me they had late-night conversations about A.I. at home,” Vance noted. “Elon is brutally logical. The way he tackles everything is like moving chess pieces around. When he plays this scenario out in his head, it doesn’t end well for people.”


So ‘lawyers’ look safe for the moment.


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I’m not sure if you can actually read the individual events, but very interesting if you can. Again just looking at the 1960 – 1980 period, a period of volatility and little capital appreciation. This rather compares to the current period of 2000 – 2016.

The message from the chart, is hang on long. If you are not in the market, then despite all the evidence to the contrary, the current pullback may be an entry point.


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Reflecting on last week’s litigation while on the treadmill I came to some conclusions.

The ‘technical’ aspect of litigation is important, but is not actually that hard if you set about it the right way. Essentially you need to know what you need to win and then set about cross-examining the witnesses to get it. Pretty easy once you have done it once or twice. The most important thing is not to appear aggressive or nasty while you are attempting to get what you need. The second thing is to know when you have ‘got enough’ or what you need for your case.

The second aspect is simply one of form, which is easy enough to learn, when to stand sit etc.

The most important and the one that will be hard to ‘learn’ is having the balls to actually litigate in the first place. This one you can learn, but if you don’t have it naturally, then I don’t think you will ever enjoy litigation, although you may become technically competent.

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Totally ignoring all of the media stories, fundamentals, anything other than the 3 charts, the charts would suggest that for a long while since 2000, the market has gone essentially nowhere until the current breakout.

The charts would suggest that the breakout has a long way to run yet. In fact, it is just getting started.

I’ve blogged about the eventual breakout previously and recommended hanging on, which I still would advocate, purely on a chart basis.

The important thing is that the ‘news’ around the breakout, as it was historically, is usually bad. There are all manner of problems. Hang on, somehow.



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The federal debt has gone from astounding to unbelievable to incomprehensible, a new problem has emerged: The US government is actually running out of places to borrow.

How Many Zeros Are in a Trillion?

The $20 trillion debt is already twice the annual revenues collected by all the world’s governments combined. Counting unfunded liabilities, which include promised Social Security, Medicare, and government pension payments that Washington will not have the money to pay, the federal government actually owes somewhere between $100 trillion and $200 trillion. The numbers are so ridiculously large that even the uncertainty in the figures exceeds the annual economic output of the entire planet.

Since 2000, the federal debt has grown at an average annual rate of 8.2%, doubling from $10 trillion to $20 trillion in the past eight years alone. Who loaned the government this money? Four groups: foreigners, Americans, the Federal Reserve, and government trust funds. But over the past decade, three of these groups have cut back significantly on their lending.

Foreign investors have slowed the growth in their lending from over 20% per year in the early 2000s to less than 3% per year today. Excluding the Great Recession years, American investors have been cutting back on how much they lend the federal government by an average of 2% each year.

The Fed is the only game left in town.

Social Security, though, presents an even bigger problem. The federal government borrowed all the Social Security surpluses of the past 80 years. But starting this year, and continuing either forever or until Congress overhauls the program (which may be the same thing), Social Security will only generate deficits. Not only is the government no longer able to borrow from Social Security, it will have to start paying back what it owes – assuming the government plans on making good on its obligations.

With federal borrowing growing at more than 6% per year, with foreign and American investors becoming more reluctant to lend, and with the Social Security trust fund drying up, the Fed is the only game left in town. Since 2001, the Fed has increased its lending to the federal government by over 11% each year, on average. Expect that trend to continue.

Inflation to Make You Cry

For decades, often in word but always in deed, politicians have told voters that government debt didn’t matter. We, and many economists, disagree. Yet even if the politicians were right, the absence of available creditors would be an insurmountable problem—were it not for the Federal Reserve. But when the Federal Reserve acts as the lender of last resort, unpleasant realities follow. Because, as everyone should be keenly aware, the Fed simply prints the money it loans.

A century of arguing about how much to increase spending has left us with a debt that dwarfs the annual economic output of the planet.

A Fed loan devalues every dollar already in circulation, from those in people’s savings accounts to those in their pockets. The result is inflation, which is, in essence, a tax on frugal savers to fund a spendthrift government.

Since the end of World War II, inflation in the US has averaged less than 4% per year. When the Fed starts printing money in earnest because the government can’t obtain loans elsewhere, inflation will rise dramatically. How far is difficult to say, but we have some recent examples of countries that tried to finance runaway government spending by printing money.

From 1975 to 1990, the Greek people suffered 15% annual inflation as their government printed money to finance stimulus spending. Following the breakup of the Soviet Union in the 1990s, Russia printed money to keep its government running. The result was five years over which inflation averaged 750%. Today, Venezuela’s government prints money to pay its bills, causing 200% inflation which the International Monetary Fund expects to skyrocket to 1,600% this year.

For nearly a century, politicians have treated deficit spending as a magic wand. In a recession? We need jobs, so government must spend more money! In an expansion? There’s more tax revenue, so government can spend more money! Always and everywhere, politicians argued only about how much to increase spending, never whether to increase spending. A century of this has left us with a debt so large that it dwarfs the annual economic output of the planet. And now we are coming to the point at which there will be no one left from whom to borrow. When creditors finally disappear completely, all that will remain is a reckoning.

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I woke up today, with nothing to do. No studying for degrees or courses, no trial prep, no work. This is the first day, in 4.5 years, that I have nothing to do today.

Obviously I am going to ride the bike if the weather holds, the past 2 days have been glorious, so fingers crossed.

Tomorrow I’m back to work, so I’ll enjoy today.

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