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| J.P. Morgan hits photographer with cane |
Let us start from an under-appreciated fact. Paul Campos reports that:
The college wage premium, that is, the increased earnings associated with having a college degree as opposed to only being a high school graduate, hasn’t changed at all in the past 25 years, because median real wages have been flat as a pancake for everybody, no matter what their formal education level, for the past quarter century.But:
I wonder what’s happened to capital over this time? Value of S & P 500, inflation-adjusted, 1/2000 to 9/2025 (same period as the wage data):On average, for more than the students' entire lives, stock-owners like Schmidt and (to a much lesser extent) I have stolen every last drop of the productivity increase of US workers at every age and education level. (See the actual numbers in the appendix)
2000: $1,394
2025: $6,688
Now, the perpetrators of this theft are telling their victims, the students and the public at large, that whether they like it or not they will be subjected to AI because that will make the perpetrators even richer. The victims have been informed that this new technology will:
- Nudify their images.
- Leak their passwords.
- Increase their utility bills.
- Consume their scarce water resources.
- Coerce state and local governments into providing many billions of dollars a year in tax breaks.
- Force them to invest their 401Ks and index funds in an obvious bubble.
- Eventually require a taxpayer bailout.
- Eliminate their jobs.
- Render their expensively acquired skills worthless.
- Be so expensive that only the rich can use it.
- Destroy democracy.
- Accelerate global warming.
- Encourage them to commit murder and suicide.
- Autonomously target them with drones.
- Possibly even end humanity.
- Add glue to their pizza.
Appendix
Here are the actual numbers from Paul Campos' 25 years of flat wages and no increase in the college wage premium, while value of capital has skyrocketed:I was fooling around with FRED this morning, as one does, and here are some stats: (The FRED numbers are presented in nominal dollars; I’ve converted them to CPI-adjusted dollars).Here is a short list of YouTube videos on this topic:
Median usual weekly earnings of workers with a high school degree only:
2000: $968
2025: $980
Median usual weekly earnings of workers with a bachelor degree only:
2000: $1,587
2025: $1,580
...
Median usual weekly earnings of people with a bachelor’s degree or higher:
2000: $1,705
2025: $1,747
- Kasia Baba's must watch Boomers just cannot grasp why we do not like AI
- Vanessa Wingårdh's Nobody Actually Wants AI Anymore
- Taylor Lorenz' You Are About to Become Economically Worthless
- Sam Seder's Everyone Is Fed Up With Tech's Ai BS
- Silicon Money's Why Tech CEOs Are Quietly Cancelling Their AI Plans
- The Rational National's Heartwarming: Gen-Z Hates Ai
Note that every single one of the ads that I saw watching these videos in an incognito window was advertising an AI company! As are 49% of all the billboards in the Bay Area. Read the room, guys!
14 comments:
A tiny spark of light in the gathering gloom..... https://open.substack.com/pub/garymarcus/p/breaking-when-dreams-for-ai-sanity
Geoff's Gary Marcus link refers to Sheera Frenkel and Tripp Mickle's Trump Signs Executive Order Seeking Oversight of A.I. Models:
"President Trump signed an executive order on Tuesday that asked technology companies to voluntarily give the government oversight of new artificial intelligence models before releasing them to the public, a shift for an administration that had promoted a hands-off approach to the powerful technology."
In an ideal world it would be easy to understand Marcus' enthusiasm. But it is a mystery why anyone would think that (a) a voluntary system would actually get the AI giants to conform, (b) that there is anyone in the administration competent to analyze the models, and (c) that allowing the Trump administration to ensure that AI models conform to their world-view is a way to mitigate their harms.
Brandon Vigliarolo makes another good point in Trump's AI E-(I)-O could let feds pick winners and losers:
"The EO also asks that the voluntary framework enable AI companies to "collaborate with the Federal Government to select trusted partners that will have early access to covered frontier models,” meaning that the Trump administration would effectively have a role in picking which companies get to participate in programs like Anthropic’s Project Glasswing for its Claude Mythos Preview.
...
The Center for Democracy and Technology’s VP of policy, Samir Jain, likewise said that the EO takes necessary steps to address risks to critical infrastructure, and like others, he praised the choice to make the framework non-mandatory. That trusted partners element, however, raised his hackles, too.
“The EO should not become a mechanism for the Administration to punish companies for political or other arbitrary reasons, and so we will be closely monitoring the details of its implementation as they emerge,” Jain said."
Bess Levin writes in Good Luck Trying to Opt Out of the AI Stock-Market Bonanza:
"Being force-fed shares of SpaceX, Anthropic, and OpenAI may be a bitter pill to swallow for the many Americans who are not at all excited about artificial intelligence. In April, a Gallup poll showed just 18 percent of people ages 14 to 29 feel hopeful about AI, down from 27 percent in 2025. The same month, an Economist/YouGov survey showed more than 70 percent of Americans believe AI is developing too quickly with 79 percent of people 65 and older agreeing."
And suggests:
"someone — Vanguard and BlackRock — should offer, like, the Total Market But Not SpaceX or OpenAI or Anthropic Fund, or the S&P 500 But None of Those Guys Fund, or maybe even the S&P 500 But Under the Old Rules Where You Had to Be Profitable and Wait 12 Months to Get Into the Index Fund."
Sanya Mansoor reports that In first, California city overwhelmingly votes to permanently ban datacenters:
"Residents in Monterey Park, California, became the first in the US to vote on a permanent ban on datacenters on Tuesday, and early results indicate a resounding victory for the prohibition.
While many cities and counties have already passed temporary or indefinite moratoriums via their local governments, Monterey Park would be the first to do so through a ballot initiative.
The ballot measure needs a majority vote – at least 51% – to win. As of 2am Pacific Time, 86.3% of the more than 7,000 votes counted so far were in favor of banning datacenters."
Ashley Berlenger reports that Trump plan to test AI models has a problem—US security teams were gutted by DOGE:
"On Tuesday, Donald Trump finally signed his executive order expanding the government’s efforts to conduct voluntary safety testing of frontier AI models. Now, critics are warning that the order may be short-sighted, offering only performative reassurances that the government is actively monitoring for AI risks, while changing very little about how and when models are deployed.
...
Politico noted that one former Trump AI advisor, Dean Ball, posted on X that the benefits of the voluntary reviews seemed “barely articulable.”
“What, exactly, is the intelligence community going to do in 30 days to make the models safer?” Ball wrote.
...
While finding vulnerabilities may be easy, consistently patching critical government systems to protect against risks would likely be challenging, Ferren suggested, especially without a specialized team of government experts. Last year, CISA was one of the hardest-hit agencies during the Department of Government Efficiency cuts. The government’s top cybersecurity recruits were “decimated,” CBS News reported, as top officers were fired, the agency was gutted, and cybersecurity contracts were canceled, Time Magazine reported."
Sophie Bakalar asks a good question in What if Consumers Hate AI Content?:
"Last week, OpenAI announced they’d be discontinuing Sora, their video generation app. If you believe the press release, this is a strategic move to divert compute to more valuable revenue streams, like agentic AI.
That’s a cleaner public narrative than the truth: consumers hated Sora.
Sora peaked at 3.3 million downloads in November 2025. Three months later, that number had fallen 67%. OpenAI was burning roughly $1M per day running an app with 2.8 stars in the App Store. The Disney partnership collapsed and the term “AI slop” hit the zeitgeist.
Sora is the most expensive consumer product flop in AI so far"
Bakalar writes:
"The backlash isn’t just aesthetic or that people think AI content looks weird. It’s that they feel deceived by it (back to that betrayal aversion). 52% of consumers say they’re concerned about brands posting AI-generated content without disclosure and 31% say AI in ads makes them less likely to choose that brand.
In other words, even if AI eventually can deceive us, it might not work. We have a natural allergic reaction to it, and the better AI gets at mimicking human work, the more betrayed people feel when they discover the deception."
@annapplebaum tweeted:
"Amazing: KPMG wrote a report describing the successful use of AI by businesses. But the case studies turned out to be AI hallucinations."
https://www.ft.com/content/b3828e92-4961-4b39-84f0-c42f33be3c3f?sharetype=blocked
Ashley Belanger reports that $130 billion in data center projects blocked by protests so far this year:
"Data Center Watch, a project from AI intelligence firm 10a Labs that tracks data center fights around the US, reported that protestors “blocked or delayed at least 75 projects nationwide worth about $130 billion from January through March,” NBC News reported.
That’s “the most in a three-month period since the group began tracking in 2023,” and it shouldn’t be parsed as “a cyclical spike,” the researchers said. Instead, there’s been a “structural shift,” as “communities have internalized an opposition playbook, legislative sessions introduced formal regulatory uncertainty, and the number of active opposition groups more than doubled to 833 across 49 states,” researchers said.
The political momentum behind data center protests is expected to influence the upcoming midterm elections, with both parties increasingly sympathizing with resistance as opposition intensifies."
Rebecca Crosby reports on How data centers are blowing a hole in state budgets:
"Many of these tax breaks have been in place for years, but as the AI industry has grown exponentially, the cost of the tax breaks has ballooned. Some states are now forfeiting billions of dollars in tax revenue.
Data centers provide limited long-term economic benefits to communities because they create very few permanent jobs. According to a 2025 Business Insider analysis, while data centers provide job opportunities while they are being constructed, “even the largest data centers generally employ fewer than 150 permanent workers.” In some states, the tax breaks “can amount over time to more than $2 million for every permanent, full-time job.” In Illinois, for example, a Microsoft data center “received more than $38 million in data center sales tax exemptions but created just 20 permanent jobs,” according to CNBC."
For example:
"Ohio projected that the tax exemption would cost $136 million in fiscal year 2025, but it ended up costing over $1.5 billion. Agreements with Amazon, Meta, and Google included 100% sales tax exemptions for up to four decades on any facility built in Ohio."
@BabyD1111229 tweeted about proposed Ohio legislation:
"Data center companies do not hold the power of eminent domain, but Callicoat says that this version could eventually allow for it. “Many of the services and utilities that they require do hold that authority,” he said. He fears that with this proposed idea, it’s broad enough that farmers could lose their land to data centers, not getting paid for it for months or years. 
Months or years. Without payment. While construction begins on your land."
Carly Page's KPMG's AI report becomes an accidental demo of AI hallucinations provides the details of the KPMG trainwreck:
"Research outfit GPTZeroo claims a forensic review of the Big Four firm's October 2025 report, "Total Experience: Redefining Excellence in the Age of Agentic AI," found that only five of its 45 citations correctly pointed to the cited source; the rest ranged from mangled and misleading to partially fabricated or too vague to verify.
...
GPTZero alleges that roughly half of the report's factual claims were false, unsupported, or attributed to the wrong source. Several case studies highlighting supposedly cutting-edge deployments of agentic AI appear to have been particularly creative."
Matt Levine comments on the KPMG fiasco:
"It’s a fascinating recursive vulnerability: Modern AI relies on trusted human sources to understand the world, but humans increasingly rely on AI to understand the world. If the trusted human sources take whatever AI says at face value, then whatever AI says will just become fact. Who can dispute what both Claude and KPMG say is true?"
Brian Fagioli observes that Sundar Pichai learned from his predecessor's experience in Was Google CEO Sundar Pichai scared to talk about AI at Stanford?:
"Yet after reading the full transcript of his speech, I was struck by how little he actually said about AI.
Instead, graduates got stories about a road trip to Las Vegas, California optimism, working on hard things, and doing what excites you. None of that advice is bad. In fact, much of it is quite good. But it also felt surprisingly detached from the questions many graduates are likely asking themselves right now."
Ed Zitron (and the FT) got a look at OpenAI's 2025 numbers and OpenAI Losses Increased Nearly 8X in 2025, With Spending Hitting $34 Billion. OpenAI spent the $34B to make $13B in revenue. But the number that really shows how the AI bubble is being inflated with a tsunami of hype is that they spent $5.73B on sales and marketing. That is 44% of their revenue.
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