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China may be subsidizing this for now in a way that US companies can't or won't - but if they keep building power infrastructure and the US doesn't, then it wil

• ufish235 5mo ago
  What the fuck are you talking about - have you seen what data centres are doing in the West? Do you want more of that?
  • Nifty3929 5mo ago
    Yes, and yes!
  • infecto 5mo ago
    I have not fully seen or appreciated most of the negativity. Obviously there are exceptions to that but in my eyes it has largely exposed how vulnerable the west is due to poor infrastructure constructs and a lack of building out generation and transmission.
  • bryanlarsen 5mo ago
    Yes, I want cheap clean power.
  • stuaxo 5mo ago
    Nope. We have exported production to China in many things, we forget that we had dark satanic mills of our own.
  • arjie 5mo ago
    To be honest, I’m sort of annoyed that the datacenter around the corner from my home closed. It was a five minute walk on 3rd street and I know of it because we used to have so many cages there 15 years ago. Now I have to drive to Fremont.
  • stavros 5mo ago
    What are data centers doing? I'd never heard of anybody having had a problem with them until about two months ago.
• Aboutplants 5mo ago
  I believe you are right. These models are at worst a 6 month lag to the costly frontier models, but the ability to scale energy production is years ahead of where the US is. That advantage is often under appreciated Their cost of energy is what matters vs the US as much as speed buildout.
  • mxschumacher 5mo ago
    I'm still not entirely clear on the problem <-> capability matching. E.g. it seems like Kimi K2.6 with good context would already be able to solve a huge chunk of problems. What share of prompts require frontier models?
• zrtac 5mo ago
  That is the talking point of OpenAI and a16z's super PAC: https://www.wired.com/story/super-pac-backed-by-openai-and-palantir-is-paying-tiktok-influencers-to-fear-monger-about-china/ https://www.wired.com/story/super-pac-backed-by-openai-and-p... "Build American AI, a nonprofit linked to a super PAC bankrolled by executives at OpenAI and Andreessen Horowitz, is funding a campaign to spread pro-AI messaging and stoke fears about China." In reality Xi has warned of AI bubbles. If China was really pushing it they'd be equal or ahead because so many researchers are Chinese anyway. Instead, China is building real stuff instead of focusing on hot air like a16z ("crypto", "AI", you name it). Maybe China should sponsor that PAC to accelerate the demise of the West.
  • aurareturn 5mo ago
    They wouldn’t be ahead because they can’t buy Nvidia compute racks anymore and they don’t have EUV machines. Blackwell is 10-20x more efficient than H200. Vera Rubin is expected to be several times more efficient than Blackwell. The US has way more compute installed in Gigawatts because China can’t get enough chips. https://epoch.ai/blog/trends-in-ai-supercomputers https://epoch.ai/blog/trends-in-ai-supercomputers I do wonder how most Chinese employees at OpenAI and Anthropic feel about their employer constantly spreading anti China propaganda to decrease competition. Perhaps money solves almost all things so they go along with it.
  • coliveira 5mo ago
    This is the next phase of the OpenAI deception: give us as much money as we want or you'll be labeled anti-US and pro-China (guaranteed by the propaganda arm of openAI).
• toddmorey 5mo ago
  It feels like the US for years has operated under the assumption that homeostasis for the global economy would always be “designed in California, assembled in China.” Like there was something in the American DNA that was lacking in China and innovation would always need to happen here. But China it seems doesn’t need the US to produce great cars, devices, robotics, or AI. We absolutely need China to help us build all of the above.
  • deleted 5mo ago
    [deleted]
  • delfinom 5mo ago
    Propaganda. We americans ate that shit up. There's nothing special about anything we design in the US other than time and money commitment to create it. China did have some espionage of course going on, but the vast majority of shit isn't some secret. And with the US shitting on China with restrictions, we increasingly caused them to invest time and money into things they otherwise would have passively accepted as coming from the west. ASML sees the writing on the wall for themselves in particular.
    • jdcasale 5mo ago
      It's both. The US has generally resorted to propaganda rather than addressing the self-inflicted structural conditions responsible for the erosion of our dominance. China also conducted a broad, sustained, large-scale campaign of IP theft across almost every industry. Obviously there is no natural law preventing China from innovating (We have treated political liberalism as a prerequisite to innovation in a way that was always partly self-congratulatory), but it's also obviously true that the speed of the gap closure is due in significant part to theft. That doesn't change the fact that they are now a legitimate competitor who has gotten a lot of things right (and among these, some things that we get very wrong) and probably actually leads in some areas.
      • infecto 5mo ago
        I like this take a lot and agree with it. The US for too long has been asleep at the wheel on many areas, power generation one of them. China with no doubt has conducted very deep and sustained espionage campaigns and even with LLMs there is enough evidence that most of the initial gains was training off of western models. Again no complaints here but I think it’s important to acknowledge both which can be true at the same time.
• bcrosby95 5mo ago
  Put another way: if the average US citizen doesn't subsidize the costs of these trillion dollar companies, China is gonna come get you. Funny that you talk about being afraid of your own shadow. I have some exposure to utility regulation and from what I can tell some of the AI companies are "good actors" and willing to shoulder some of the burden. But others are pretty adversarial and want a free lunch.
  • margalabargala 5mo ago
    > Put another way: if the average US citizen doesn't subsidize the costs of these trillion dollar companies, China is gonna come get you. The future is blatantly going to be electric. Between cars, heat pumps, ranges, etc, the quantity of kilowatt hours consumed will rise dramatically per capita because they are replacing burned fossil fuels. We don't need to subsidize the trillion dollar companies, we can settle for just not cancelling wind and solar projects, and generally updating the grid infrastructure. A rising tide lifts all boats. If the subsidies go to common infrastructure, that's good for everyone. There's no need to complain about a road being paved because it will benefit FedEx in addition to everyone else.
    • jm_l 5mo ago
      All public infrastructure benefits the public but the role of our governance is to correctly prioritize. $100 billion spent on nuclear power plants is $100 billion being withheld from other critical social services.
      • margalabargala 5mo ago
        > $100 billion spent on nuclear power plants is $100 billion being withheld from other critical social services. What? No it isn't. There are many places the government could use to appropriate funds, not just social services. The military, for example. Other subsidies. Tax credits. Simply increasing the debt.
      • manyatoms 5mo ago
        The US could very causally spend a couple $100B less on their military and not have a real reduction in capability.
• onlyrealcuzzo 5mo ago
  > China may be subsidizing this for now in a way that US companies can't or won't They're subsidizing this in many ways - Huawei chips, new DDR5 memory fabs, etc. Ultimately, DeepSeek's architecture is significantly more cost effective than anything from Google, OpenAI, or Anthropic. Presumably, they'll incorporate DeepSeek's MLA* architecture to get all the benefits for next year's releases (if not this year's upcoming releases) which will bring down their costs... They need to actually make money, though, so that might still not give them enough room to make enough money. Ultimately, hardware depreciation is like 80% of total spending. So power is not as big of a deal in cost. The bigger problem is if you can get the power at all, not how expensive it is. If you want to bring down inference costs, using less hardware is far more effective than getting cheaper electricity. Google is in a sweet spot, because they aren't paying 80% margins to nVidia for hardware. So they're probably paying half as much deprecation as everyone else is (or maybe 1/4th for inference - which is now the biggest percentage overall).
  • onionisafruit 5mo ago
    What’s the TLA architecture? I haven’t read about that.
    • borski 5mo ago
      MLA, not TLA: https://medium.com/data-science/deepseek-v3-explained-1-multi-head-latent-attention-ed6bee2a67c4 https://medium.com/data-science/deepseek-v3-explained-1-mult...
  • PearlRiver 5mo ago
    Look up the US deficit- they have been subsidizing everything since the 1980s.
    • coldtea 5mo ago
      And the "wars for oil" is part of that.
  • nl 5mo ago
• energy123 5mo ago
  It's not really a bottleneck. US capital is building data centers in South Asia, MENA and SEA. Many of these countries offer tax breaks because they want US data centers, and they have abundant equatorial land for solar. You might say that US would prefer sovereignty but that's a separate argument vis-a-vis strategic competition with China in particular.
  • delfinom 5mo ago
    Wonder if they are finally exploring installing anti air defenses on these datacenters given they are massively expensive and devastating targets of extreme opportunities.
• lenerdenator 5mo ago
  > while Western Democracies are afraid of the future, and of their own shadow. Well, yeah. This is a technology that has the potential to make large chunks of the population unemployed. Chunks of the population that took on debts prior to late 2022 with the understanding that there would be a way to pay those debts back with their labor.
  • blowscum 5mo ago
    > Chunks of the population that took on debts prior to late 2022 with the understanding that there would be a way to pay those debts back with their labor. I’m calling it now, the future is indentured servitude.
• hedora 5mo ago
  I'm not sure how much of it is subsidies. If the open weight models are anything to judge by, China is taking price performance seriously, and the US model vendors are looking for performance at any cost. Like any other Pareto optimization, we end up paying 10x more for the last few percent improvement on benchmark scores. Of course, like literally every other time this has played out in computing history, the companies focused on price performance will end up with more economic resources, and get to turn the upgrade crank more often and for longer. Also, of course, China's way ahead of the US on things like renewables, batteries, and electrification of their economy. All of that feeds into cheaper power to run the models, but I suspect it's a second order effect vs. "improve the software".
  • submain 5mo ago
    It seems to me China is chasing widespread adoption, while the US is chasing the AGI dream.
    • ifwinterco 5mo ago
      This is my read as well - Chinese labs don’t really seem to believe in AGI and instead the focus is on optimising the transformer architecture so it can be actually useful for specific tasks, ideally at a low cost
  • mxschumacher 5mo ago
    not just renewables, also massive nuclear capacity and huge modern coal plants. They can really crank up capacity if they want to. How long will it take to get a new nuclear power plant operational in the US?
    • ian_holt 5mo ago
      I agree with that too. Whilst we here in the "Land Down Under" (Australia) seem to have a fixation on NOT wanting to go down the nuclear energy route and we seem rather keen on tearing down our last remaining coal-fired power stations and 'trying' to rely on so-called renewables. From direct experience, our energy costs have gone through the roof and regardless of what our 'wonderful' politicians tell us, that is not going to change any time soon. We seem to want to just give our uranium to USA, Japan, France, and South Korea so they can make cheap energy, whilst we send our best coal to Japan, China & India. Go figure...
• readthenotes1 5mo ago
  "China is building for the future, " Meanwhile, the USA is paying for its past excesses, with interest on its debt being the number two most expensive line item in the budget. https://fiscaldata.treasury.gov/americas-finance-guide/federal-spending/ https://fiscaldata.treasury.gov/americas-finance-guide/feder...
  • delfinom 5mo ago
    Yea, I really don't see how much longer the US economy can hold on. The baby boomers are working overtime to rob multiple future generations of opportunity to feed their profits now. The formerly "fiscal conservatives" that I know are working overtime explaining how the debt isn't a bad thing and we can just move numbers.
    • xienze 5mo ago
      > The formerly "fiscal conservatives" that I know are working overtime explaining how the debt isn't a bad thing and we can just move numbers. Sounds like they're just catching up to what Democrats always used to say whenever a Democrat was in the White House and some Republican would complain about the national debt. "A government isn't a household, debt doesn't work the same way, you don't get it."
      • 59nadir 5mo ago
        That's interesting, because I thought it was common knowledge that Republican presidents actually add more on average to national debt...?
  • DennisP 5mo ago
    If you look at total debt instead of just national government debt, then China is even worse off than the US. Article in Fortune: https://archive.is/53Vu0 https://archive.is/53Vu0
  • quantum_state 5mo ago
    In the last 40 years, China has been building while the US has been wasting money and lives fighting wars. Can we learn to really put America first for once?
• huflungdung 5mo ago
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• themafia 5mo ago
  > then it will no longer require subsidy from them Is there actually a huge Chinese consumer market for these products? If not then I'm not sure how you ever actually achieve this endpoint. Chinese wages and American wages are not nearly the same thing yet. > It will simply be absolutely cheaper (including profit margin) to serve tokens in China. It will simply create more pollution and environmental destruction too. > China is building for the future That's the plan. Whether that's true requires an honest analysis. > while Western Democracies are afraid of the future Developed nations take fewer risks than undeveloped ones. Do you assume this pitched dichotomy will naturally sustain itself? > and of their own shadow. Yea, it's funny what having open and fair elections can do for a country.
  • lejalv 5mo ago
    You got me with fair. Gerrymandering, PACs, two-party system, electoral college. Where do we start...
    • themafia 5mo ago
      We start logically. Do you presume your handful of cases exemplify the entire Democratic system? Do you assume that "China" is best understood as a single centralized entity? You completely walked past the argument to pick at a meaningless nit.
      • lejalv 5mo ago
        Handing out lessons in democracy from the record-holder country in foreign intervention (https://en.wikipedia.org/wiki/United_States_involvement_in_regime_change https://en.wikipedia.org/wiki/United_States_involvement_in_r...) had equal civil rights only in the 1960s, pardoned the perpetrators of Jan 6, has its supreme court in entirely political hands, and has the awesomest repressive force in the world, together with the incarcerated population to go with. Maybe I picked like 4 meaningless nits as in: US politicians respect so much democracy that they constantly reweight "one person, one vote" to suit the interest of the incumbent, they do not have their outrageously expensive campaigns financed (legally) by private interest groups, the popular vote is represented, and elections are uncontested (unless the wrong candidate wins, where the Supreme Court promptly fixes the issue), and it has room for more than two (quite similar I may say) viewpoints in representation. Maybe. But please don't call “Yea, it's funny what having open and fair elections can do for a country.” an argument.
• clear-octopus 5mo ago
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• watwut 5mo ago
  American companies are selling tokens on a loss for years now. Where is that alternative universe in which America is not subsidizing this? Selling under price to capture market was American playbook for last 20 or more years.
• dartharva 5mo ago
  > while Western Democracies are afraid of the future, and of their own shadow. Trillions of Dollars being invested against AI infra would indicate otherwise. US is in fact betting a lot of its economic future on AI.
• gmerc 5mo ago
  Remember kids, in the west it’s “investment”, in China “subsidy”
• dominotw 5mo ago
  > China is building for the future, while Western Democracies are afraid of the future who are the decision makers in china?
  • tmnvix 5mo ago
    The 96 million members of the CCP and the entrepreneurs incentivised to make decisions based on the policies they introduce? Who are the decision makers in western democracies? I'm being slightly facetious - there are many answers to these questions. The one that actually matters to me though is "do the people that are making the decisions do so in the interests of society?" Not in my 'democracy', that's for sure.
    • dominotw 5mo ago
      i mean why are 96 million ppl not afraid of future like western countries.
• epolanski 5mo ago
  > China is building for the future, while Western Democracies are afraid of the future, and of their own shadow. Yes, countries where compromise is not required, where social, capital and human costs are non-factors and where regulations are bendable at will by who's in power can be more effective at achieving some goals.
• bdangubic 5mo ago
  yup - good read: https://www.thebignewsletter.com/p/the-efficiency-moat-why-china-is https://www.thebignewsletter.com/p/the-efficiency-moat-why-c...
• itemize123 5mo ago
  they are doing it through state investment vehicles - so it's in the same way US companies can (but won't)
• windexh8er 5mo ago
  It's not western democracies. It's western capitalism, and more poignantly, western billionaires. They're feeding the narratives. Peter Thiel, Sam Altman, Elon Musk, Mark Zuckerberg - they're the ones with bunkers and exit strategies. They are the lunatics buying seats at the political table and spreading FUD and meddling in our elections. They are the ones destroying the west's chances at a competitive future, instead: "capitalism". They wanted the division, they're getting it and one side is raping and pillaging the masses.
• protocolture 5mo ago
  I feel like the chinese government see this in terms of the space race. Not that, there's a cool new frontier to explore. But that its a great opportunity to subsidise an industry and watch their slower fatter competitor go bankrupt trying to keep up. >But the US did it first What is sputnik.
• coldtea 5mo ago
  Wasn't it also focused on efficiency way more than the "throw VC money at the issue" Anthropic/OpenAI designs? Don't follow AI close, but I remember DeepSeek being a "much cheaper" to deploy model for close performance.
• sfifs 5mo ago
  Benchmarking the kind of cost savings I'm seeing moving from sonnet and gemini flash to local models, inference runs at least 90-95% gross margins. So they are probably still gross margin profitable. BTW form my benchmarking, open weigh models are good enough for many agentic tasks starting with Qwen 3.5/6 family and Deepseek v4 family, so it's likely we'll see displacement of api usage from the premium priced providers. Yes trainingis expensive, this isn't training
• redanddead 5mo ago
  Yeah. What we have here is simply poor governance.