What governments do (which is the actual content of the article) is betting on economic growth to exceed the growing debt.
Generally, they are a trailing indicator, like someone appearing on the Forbes millionaire under 30 list (Theranos, FTX). However, they are not always wrong.
Think of Economist writers as intelligent interns - people who couldn't make it in the world of finance, and with a particular ideological bent imposed on them by their editors.
Now in 2020s, it seems only China is tailing US and in turn, US is wary of China. What gives?
The reality is LLMs are just tools, and not even close to as revolutionary of tools as computers themselves. Even Chinese companies understand that. It is the US alone that is in machine god mania, gambling their economy on this idea that the next model will let them rule the world if only we give it three more months.
Why Japan and Europe don't develop a model that is 20% worse at 0.001x the cost?
1. Price of electricity is low because of China's excellent energy policy. Admittedly this should absolutely be a priority of Japan/EU, but it isn't, so first you'd have to start there...
2. Because of #1, China already had massive infrastructure in place for eg. crypto mining that was readily repurposed. Japan/EU never engaged in this fad, so they have to start effectively from scratch in building out the GPU infrastructure.
3. Chinese talent has a major advantage in being relatively isolated from the US economy. US-aligned economies must compete with the US for talent. It's hard to develop technology at a reasonable cost when all of your top talent is leaving to get paid 10x as much by speculative gamblers. If you don't have a very good reason to believe the gamblers are making a good bet, it's better to wait for them to go bust.
Added on to all of that... where is the upside? Chinese models are open anyways. There is nothing that merits this being a matter of urgent government intervention at all, it's basically pure downside.
The counterfactual was never "cutting pensions and medicare". That wasn't on the table and no government would ever commit suicide and pass it. It was either, spend until the economy completely collapses under the weight of debt and hyperinflation, or do exactly the same thing but pray for a miracle while doing so.
So, we're doing the second one.
“The Fifth Generation Computer Systems…was a 10-year initiative launched in 1982 by Japan's Ministry of International Trade and Industry (MITI) to develop computers based on massively parallel computing and logic programming” [1].
That sounds an awful lot like GPUs and HBM.
[1] https://en.wikipedia.org/wiki/Fifth_Generation_Computer_Syst...
A lot of what's happening now is the (very) belated delivery of what everyone was talking about when they talked about "expert systems."
zekrioca•1h ago