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If this becomes the norm, what incentive does the rest of the world have to keep their markets open to the US? If US companies have a large unfair advantage su

If this becomes the norm, what incentive does the rest of the world have to keep their markets open to the US? If US companies have a large unfair advantage such that domestic competitors are no longer able to compete, then wouldn't it make sense for governments around the world to ban or tariff US products and services? If I was responsible for national economic policy, I would place this at the top of my non-emergency agenda. The world needs to act quick before their industries fail.

spwa4 3mo ago
The US as a large-scale import nation and so does not need the rest of the world (except perhaps Europe, and only small parts) to keep its markets open to the US. Even in the European case, Europe would lose much more than the US would if they closed their markets. Plus, a lot of Europe is either very close to breaking point and unwilling to change (Italy), or rapidly worsening into a crash, and unwilling to change (France). It's Europe that is dependent on a large trade surplus with the rest of the world, financed by dollar loans to 3rd world countries. Now China is taking away their trade surplus, even directly (meaning Europe has a massive trade deficit to China), and indirectly (replacing demand for European goods, famously cars, everywhere). This is causing large-scale job losses in Europe as well as total disaster for government finances across the block, finances that were unhealthy to begin with. Now Europe and China are unwilling to lend to the rest of the world (because initially that would make very rich Europeans/the CCP a little bit poorer, by raising inflation quite a bit, thereby raising interest rates, which will move government finances from disaster to catastrophe), so if these money flows are to keep going, either the US MUST export to China, which is not happening, or EU and/or China must loan several times their own GDP to the third world, or the EU and/or China must massively increase their dollar holdings (which will, of course, inflate the Euro and Renminbi something awful whichever way it goes). But either WILL happen, because a crash will do that too. Which is what people mean when they say the worldwide system is on a crash course.
- someguyornotidk 3mo ago
  I don't think whether a country is an importer or an exporter matters at this point. This is likely going to develop into a matter of national security. Nations cannot allow most of their domestic industries to be destroyed. If the US doesn't reverse course soon, I think we'll start seeing large-scale closure of international markets to US companies very soon. Even with US retaliation, there is no other option.
  - mike_hearn 3mo ago
    Zero chance of that happening. Europe has already largely deindustrialized and it never closed itself to China. Europe also tried to stop buying Russian oil and failed due to transshipment through India. It's really sad seeing how little so many of us Europeans understand the situation. America and China hold all the cards, Europe holds none. It makes very little that is both unique and strategic. Decades of left wing economic policies are coming home to roost and there's no way to turn the ship around now.
    - Mairoce 3mo ago
      Please tell us more about how “left wing economic policies” have destroyed Europe.
    - chiply314 3mo ago
      Germany, the 3th biggest GDP country is deindustrializing right now. that def will hurt. But we still have a lot of capital left, so plenty of ways to adress the elephant in the room. Its just very weird that the current CDU doesn't has any real good ideas. USA has a certain amount of hands especially IT but otherwise? China runs circles around Europe and USA for everything else. Btw. CDU was in power for 16 years and is more right wing than center. If you say left wing in sense of not protecting our own markets, i think this was accepted globally. USA also can't make things anymore. If no-one comes up with the general notion of a min of like 60% home made, none of it matters because rebuilding this will take a lot of time and money. And even with a chip factory in USA, they still import most and automate as much as possible. This might reduce the pressure on USA Loans but will not help the USA people themselves. They will just continue seeing a bigger and bigger split between poor and rich.
- HexPhantom 3mo ago
  I think this is a bit too deterministic. Even if Europe is in a weak position economically, "the US does not need the rest of the world" seems overstated
  - chiply314 3mo ago
    I would even argue that the USA is imploding without China. The normal USA citicen can't afford a car anymore. Either they make it a lot cheaper over there or they have to continue pressue the USA Citicents to accept that they are not allowed to buy cheap China products. It will be quitei nteresting to see if we will see a global rebalancing of manufactoring and co around the globe for USA, Europe and China or a overall change in system from pure capitalism to something else. Or the big players start to reinvest into countries again to have customers who can actually afford it again.
    - spwa4 3mo ago
      This is not how economists think. They see the US, go "Coal mining, check. Iron mining, check, so you can make steel inside US. More than enough people, check. Oil, check. As well as 1000 other things, and mostly, the checks are there", and conclude the US could produce cheap cars. So if it makes sense or it becomes urgent enough, it will happen. Nothing is really preventing the US from doing everything itself, and doing that will improve the balance of trade (while making Americans much poorer). In other words, the problem of "The normal USA citizen can't afford a car anymore" can be understood in a different way. That can be fixed, by paying people less (yes, less, really, think about it) The US can drop it's imports and do essentially everything itself. Right now people can't afford a car because the US is so equal, meaning they can't compete with labor in India or ... But you could "fix" that, by creating more inequality in the US (do what we effectively do now, worldwide, but within the US. Forbid people immigrating from California to New York. Move all banks to New York, build factories in California. Pay people in California 20% what they make in New York for the same job), and production will move back to the US. And if that offends you, please understand that's exactly what we're doing now. Just replace California and New York with India or China and New York with, well New York, or Washington, and that's exactly the system we have. That's the system the EU is trying to create in the EU. Doesn't work that way for exports (EU, or China, or to a lesser extent, India). The EU is an export block that's rich getting out competed by export blocks that are poor ... Now THAT is a difficult problem to solve. Not that EU politicians are even trying. The US is not doing better because US politicians are better than EU ones. They just have a much easier problem to solve. And, of course, both US and EU politicians are failing, but the consequences are much bigger in the EU. For example, the EU is in fact making it harder to immigrate WITHIN the block, despite "free movement", and is creating massive differences in pay for the same work, which is apparently what socialism stands for: Typical after-tax pay for supermarket cashier: Netherlands: 2550 euro (after tax), for 36 hours of work ~ 15 euro/hour Greece: 1050 euro (after tax), for 40 hours of work ~ 6 euro/hour Oh and that's not where it ends. You get way more social protection and medical in the Netherlands ... for paying less in tax. The EU is purposefully creating inequality to solve the problem of rich Dutch people not getting richer fast enough. It's only within the same country that there is less inequality in the EU. And, of course, the EU has been making it worse, not better, for about 18 years now. They're not about to stop. The US hasn't even decently started doing this yet.
- lljk_kennedy 3mo ago
  [citation needed]
- fspoettel 3mo ago
  Europe generates ~20% of revenue for US big tech which is a large part of its stock market. With how precariously coupled US growth is to these companies, it absolutely needs that market.
  - sajithdilshan 3mo ago
    But can the Europe survive without the US big tech. Imagine the worst case US bans any sort of export from big tech to Europe, all startups and even every tech reliant company in EU would collapse without AWS, Azure or Google cloud. Also imagine ban on exports from Apple and Google, from tomorrow onwards both iPhones and Android phones stops working because software services are banned in EU. It’s so easy to argue on putting tariff on US tech, but we forget how much Europeans depend on it and it would be like shooting one’s own foot. One could argue that over the time EU can build their own infrastructure and alternative, but who is going to invest for it? The governments? With tax payers money? And who is going to build it? EU is one of the fastest aging continent in the world and what can they offer to attract young talent?
    - iririririr 3mo ago
      that would actually spark a new golden age. aws et all are just extracting rent. we all know this. telcos have some ownership of the android firmware they distribute, and could easily spin up and fund alternatives like replicant or even go full partnership with Chinese versions. simply moving email providers from Microsoft would make threeletter agencies work much more difficult, and it's a 2min dns change. any way you look at it, the impact would be positive. i don't think your example is the example you think it is. like trump, you're ignoring agency to every other player in the systems and ignoring some obvious consequences.
      - sajithdilshan 3mo ago
        Either you’re stupid or ignorant. What do you mean by easily spin up alternative android? And who is going to fund that? EU spend millions of Euros for a corona Warn app, and spinning an android alternative would cost billions, with tax payers money. Also everyone that uses iPhones, what are they going to do? Are they gonna get free android phones? Forget about phones, all the companies that uses RDS would lose their data and that would be catastrophic.
- FranzFerdiNaN 3mo ago
  America has to be careful not to push Europe into the direction of China though. And with how Trump acts that might happen sooner than they would like. Bullying like how Trump prefers to do only works until some point. Europe mostly seems to bet on America changing its tune again once Trump is gone but we have to wait and see if the rot in America hasnt set in too deep already.
  - sajithdilshan 3mo ago
    Even if America pushes EU to be like China, they cannot be China. China is one country ruled by one law and in a unified vision. On the other hand EU is a band of 27 countries with different laws, different problems and different priorities. They couldn’t even agree on a response for Ukraine-Russian war and present a unified front and do you think they would present a unified front against Americans?
    - big_paps 3mo ago
      I think he meant : to be pushed towards China as a partner while moving away from the US.
      - spwa4 3mo ago
        And ... what will Europe do if America simply ... also moves to use China as a trading partner? Or just drops the EU goods entirely? It'll be unpopular for 1 or 2 years and then the US will be better off. The the EU will have to create 600 billion in new (dollar) revenue per year to compensate. They haven't successfully done that in 20+ years ...
- sajithdilshan 3mo ago
  European economy would implode without trading with US. The biggest economy in Europe, Germany; exports cars, pharmaceuticals and other high end machinery to US and the whole middle class in Germany relies on the jobs from those exports oriented companies
  - makapuf 3mo ago
    You talk about Europe then only give Germany examples ..? Is that a German only problem ?
    - sajithdilshan 3mo ago
      Germany is the biggest economy in the Europe and the one that’s holding Euro stable ( France and Italy would soon be only serving their debt). If German economy goes down, then you can say goodbye to Euro
  - gmueckl 3mo ago
    Cars are largely not exported to the US from Germany, but built in US factories. German car companies have factories all over the world.
  - NorwegianDude 3mo ago
    To be fair, it would be a bigger issue for the US. No country is more economically dependant on the rest of the world than the US. The US is living on the USD, and if others stop using it the US would have to do extreme cuts on everything.
    - sajithdilshan 3mo ago
      That’s true, but every time a country or a group of country tried to do that US has stopped it either strategically or with military force so far.
      - NorwegianDude 3mo ago
        But you are talking about Europe. If the US and Europe were to cut all ties they would both face some serious consequences, and the US wouldn't be able to do anything about that, not strategically or military. The US need trust in order to function, and attacking would loose them all trust globally, making it much much more severe than anything any other nations would struggle with.
- Mairoce 3mo ago
  Ah yes, the classic “Europe is in decline” narrative favored by Americans. You’d think after more than a decade of that nonsense, people would start to ignore it or at least question its assumptions. Nominal GDP and venture capital funding are not the only things that matter in an economy.
  - WarmWash 3mo ago
    Europe has no tech industry. It's largely floating on the same economy it had 50 years ago. The situation is beyond dire.
    - NorwegianDude 3mo ago
      Hey! We Norwegians have on average more ownership in US tech companies than Americans! Everything is going according to plan. When we have majority, we'll move the companies to Norway, but don't tell anyone, this is supposed to be a secret. /s
- chiply314 3mo ago
  What the Clown currently does is to push Europe massivly into exactly this. I can't find it right now but I read news just a few month ago that the EU is working on making it easier to invest into EU similiar to how the Petrodollar currently works. But if the deindustrialization of germany/EU continues as it currently does and US implodes and China has also issues, we will see how the new world order will look like. China is for sure more resiliant though. The living standards were never as high as what we as germans are used to and they dont demonstrate. In the USA people have guns and civil issues and a hard divide between city and country sides. But as Europe/Germany we should be able to increase our bonds right? Investing into solar/energy transformation; Doesn't matter short term how this will end. And if AI continues as it does with robotics, we might even see in 50-100 years a complete change in system? USA Bonds are exploding so they might have overplayed their hand already.
HexPhantom 3mo ago
It feels less like a pure tech market now and more like cloud, semiconductors and defense policy all getting mixed together
- delta_p_delta_x 3mo ago
  Military-technological industrial complex. Has always been a thing. Nascent WW2 computers were used for artillery, rocket, and bomb guiding.
grumple 3mo ago
Is the rest of the world really that dependent on emerging AI? I don’t think so. The US could cut off all foreign access to AI, nobody would notice.
- basisword 3mo ago
  It would definitely be a problem. A big one. Think of all the multi-national tech companies that have rolled out AI not only to their engineering teams but to their business teams now too. Suddenly your employees in the US can do more and do it quicker than your employees elsewhere. It would be a nightmare to try and manage.
  - graemep 3mo ago
    That only applies to things Mythos does better than Opus. Mythos is supposedly very good at things such as finding vulnerabilities, but is it better at business tasks? IN the short time I had access to Fable it did not seem noticeably better at things I tried it for (lots of small tasks). Maybe it is better at vibe coding or finding security flaws, but at how much is it sufficiently better to be worth paying the extra?
    - basisword 3mo ago
      You're assuming this export restriction won't apply to any future models. The problem is a couple of years from now when the ROW is still on Opus and US workers are on something much better.
      - graemep 3mo ago
        Which would force us to use Chinese models instead. It would also increase the incentive for other countries to develop models.
  - grumple 3mo ago
    I disagree. I work at a very large international corporation. How much revenue do you think we’ve seen due to AI? I’d guess it’s zero. I know for the groups whose finances I see, it’s zero. Yet costs have gone way up. There’s a bunch of new code, but not anything customers are going to pay more for. And either way no AI basically puts you back to where we were last year. US employees have always been far more productive, that’s nothing new.
pythux 3mo ago
It might not be a coincidence that POTUS wrote yesterday on Truth Social that 100% tariffs would be imposed on any country proceeding with taxing US' digital services.
- chinathrow 3mo ago
  Pure grift.
- graemep 3mo ago
  Empty threat conditional on something that will never happen. Most of the rest of the world is too heavily dependent on US digital services to tax them more heavily. From social media to hyperscaler's clouds the US is dominant and stuff will just stop working if they get taxed. There would be a huge pushback from businesses if their government increased the cost of things like AWS. Edit: edit to say tax more heavily
  - masfuerte 3mo ago
    Eh? We already tax them. The UK is not alone in having a digital services tax.
    - graemep 3mo ago
      Sorry, meant tax more heavily. Uk's tax is 2% and limited to advertising and marketplace fees.
      - swarnie 3mo ago
        I'm happy to vote for anyone who can put an extra 0 on that, it would be nice for these companies to pay more tax than me one of these years....
        dlahoda 3mo ago
        They already pay. How 10usd subscriptions become 10eur or 10£? Companies pay lawyers and beurocrats and accountants to operate.
Chance-Device 3mo ago
Yes, this is exactly the implication. The decoupling of economies between those that have advanced AI, those who do not, and those who decide to ban AI outright or above a certain level of capacity.
mantas 3mo ago
The rest of the world already has quite a few restrictions.
_heimdall 3mo ago
This is far from a new challenge though. Another recent example, China has an advantage on cost of labor and manufacturing, and lack of enforcement of IP rights. They can produce for much cheaper than many other countries but it hasn't led to everyone banning trade with them.
- epolanski 3mo ago
  What part of China has cheap qualified labor? Skilled engineers nowadays demand between southern and central European prices at the very least.
  - chiply314 3mo ago
    Cheap qualified labor doing machining for example. They def make less than in europe. You make very good money for working at Volkswagen on the line. And China now also has software developers and even if they make the same amount, they are def also now a big player in the game and take parts of the cake.
  - deleted 3mo ago
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  - _heimdall 3mo ago
    What type of roles are you considering? Look into their manufacturing, for example. They make all kinds of heavy machineryat costs much lower than US prices, as far as I understand a big contributor is labor costs. Its also worth noting that st southern and central European labor costs they would still have an advantage over the US.
sajithdilshan 3mo ago
One would have to have leverage to put tariff on US and not worry about retaliation. Almost every country is tightly coupled with US, let it be trade or reliance on technology. I can only think of Russia that is decoupled from US at the moment and they are stuck with Putin that still lives with imperial mindset rather than actually being a rival to US
- bootsmann 3mo ago
  The US doesn’t have this leverage either, Trump is just uniquely willing to hurt his own country for his own idiosyncrasies. It is pretty established at this point that Americans were the most hurt by his tariffs.
deleted 3mo ago
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m3kw9 3mo ago
We don't need more fear mongering with AI, it already made a mess. Industries are not gonna fail, they fall behind, like how US doesn't share weapon tech or certain IP's. Plus you have China providing a close 2nd/3rd place LLM tech for free.
mrtksn 3mo ago
The incentive is that Americans are huge consumers and closing markets to US also means losing US markets, that's why Trump's taxation on Americans for imports(AKA tariffs) caused huge stir. That said, if the risk is not tolerable then it's not worth it and can be sacrificed. EU was fully on board to do that if Trump invaded Greenland and EU as rest of the world are aggressively diversifying. BTW EU will never have a "tech" industry in any meaningful size as long as US have access to EU markets, anyone who eventually got tech industry are those who blocked the US or were blocked by US. So if US keeps its course, in a few years we may end up with fragmented markets with US blocked out because the US is very unpopular but the current politicians everywhere including in the EU are very pro-US actually hoping that current situation is just a glitch, which is not aligned with what the general population demands and as a result the next elections they will align with anti-Americans.
outside1234 3mo ago
Worse, why would you ever take a dependency on a US company. Even China seems more trustworthy at this point.
varispeed 3mo ago
You are assuming that governments care and are not corrupt. I think they have very little room for manoeuvre - companies like AWS or Microsoft can simply you are too cocky and we will shutdown infrastructure your country is running on if you don't bend the knee.
_3u10 3mo ago
They don’t, they wouldn’t need tariffs if they did. America mostly produces cheaper ag commodities than the EU but more expensive than South America. Deepseek is already a better search engine than Google. (Not sure if it does Google searches) Travel the world it’s not American companies gaining market share. I would especially recommend trying Chinese AI or riding in a BYD car and judging for yourself.
WarmWash 3mo ago
Its utterly unsurprising that in the reckoning of pro-socialist society (work less, tax more, live easy), the failure of European industry over the last 30 years, utterly unsurprising that the knee-jerk reaction is "You need to share your labor with all of us" rather than "We need to get our shit together and build a competitor" Europe isn't cooked because it lacks talent, there are untold smart capable people there, it's cooked because it built a social allergy to the very thing it needs most.
Balgair 3mo ago
> The world needs to act quick before their industries fail. It's a cost problem. If you want to try for a SOTA model, you're going to need to spend big time. Germany spent ~$115B last year on it's defense, roughly 2% of it's GDP. In contrast, ~$145B was spent last year just on AI infrastructure by Meta, and, well no one talks about Meta winning any AI races.
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mmooss 3mo ago
> If US companies have a large unfair advantage The US companies with access have a large unfair advantage over other US companies. Imagine being Rivian if Tesla gets access, Rocket Lab or Blue Origin others if SpaceX gets access, most of SV if major tech companies get access, ... imagine being a startup.

spwa4 3mo ago

The US as a large-scale import nation and so does not need the rest of the world (except perhaps Europe, and only small parts) to keep its markets open to the US. Even in the European case, Europe would lose much more than the US would if they closed their markets. Plus, a lot of Europe is either very close to breaking point and unwilling to change (Italy), or rapidly worsening into a crash, and unwilling to change (France). It's Europe that is dependent on a large trade surplus with the rest of the world, financed by dollar loans to 3rd world countries. Now China is taking away their trade surplus, even directly (meaning Europe has a massive trade deficit to China), and indirectly (replacing demand for European goods, famously cars, everywhere). This is causing large-scale job losses in Europe as well as total disaster for government finances across the block, finances that were unhealthy to begin with. Now Europe and China are unwilling to lend to the rest of the world (because initially that would make very rich Europeans/the CCP a little bit poorer, by raising inflation quite a bit, thereby raising interest rates, which will move government finances from disaster to catastrophe), so if these money flows are to keep going, either the US MUST export to China, which is not happening, or EU and/or China must loan several times their own GDP to the third world, or the EU and/or China must massively increase their dollar holdings (which will, of course, inflate the Euro and Renminbi something awful whichever way it goes). But either WILL happen, because a crash will do that too. Which is what people mean when they say the worldwide system is on a crash course.

someguyornotidk 3mo ago
I don't think whether a country is an importer or an exporter matters at this point. This is likely going to develop into a matter of national security. Nations cannot allow most of their domestic industries to be destroyed. If the US doesn't reverse course soon, I think we'll start seeing large-scale closure of international markets to US companies very soon. Even with US retaliation, there is no other option.
- mike_hearn 3mo ago
  Zero chance of that happening. Europe has already largely deindustrialized and it never closed itself to China. Europe also tried to stop buying Russian oil and failed due to transshipment through India. It's really sad seeing how little so many of us Europeans understand the situation. America and China hold all the cards, Europe holds none. It makes very little that is both unique and strategic. Decades of left wing economic policies are coming home to roost and there's no way to turn the ship around now.
  - Mairoce 3mo ago
    Please tell us more about how “left wing economic policies” have destroyed Europe.
  - chiply314 3mo ago
    Germany, the 3th biggest GDP country is deindustrializing right now. that def will hurt. But we still have a lot of capital left, so plenty of ways to adress the elephant in the room. Its just very weird that the current CDU doesn't has any real good ideas. USA has a certain amount of hands especially IT but otherwise? China runs circles around Europe and USA for everything else. Btw. CDU was in power for 16 years and is more right wing than center. If you say left wing in sense of not protecting our own markets, i think this was accepted globally. USA also can't make things anymore. If no-one comes up with the general notion of a min of like 60% home made, none of it matters because rebuilding this will take a lot of time and money. And even with a chip factory in USA, they still import most and automate as much as possible. This might reduce the pressure on USA Loans but will not help the USA people themselves. They will just continue seeing a bigger and bigger split between poor and rich.
HexPhantom 3mo ago
I think this is a bit too deterministic. Even if Europe is in a weak position economically, "the US does not need the rest of the world" seems overstated
- chiply314 3mo ago
  I would even argue that the USA is imploding without China. The normal USA citicen can't afford a car anymore. Either they make it a lot cheaper over there or they have to continue pressue the USA Citicents to accept that they are not allowed to buy cheap China products. It will be quitei nteresting to see if we will see a global rebalancing of manufactoring and co around the globe for USA, Europe and China or a overall change in system from pure capitalism to something else. Or the big players start to reinvest into countries again to have customers who can actually afford it again.
  - spwa4 3mo ago
    This is not how economists think. They see the US, go "Coal mining, check. Iron mining, check, so you can make steel inside US. More than enough people, check. Oil, check. As well as 1000 other things, and mostly, the checks are there", and conclude the US could produce cheap cars. So if it makes sense or it becomes urgent enough, it will happen. Nothing is really preventing the US from doing everything itself, and doing that will improve the balance of trade (while making Americans much poorer). In other words, the problem of "The normal USA citizen can't afford a car anymore" can be understood in a different way. That can be fixed, by paying people less (yes, less, really, think about it) The US can drop it's imports and do essentially everything itself. Right now people can't afford a car because the US is so equal, meaning they can't compete with labor in India or ... But you could "fix" that, by creating more inequality in the US (do what we effectively do now, worldwide, but within the US. Forbid people immigrating from California to New York. Move all banks to New York, build factories in California. Pay people in California 20% what they make in New York for the same job), and production will move back to the US. And if that offends you, please understand that's exactly what we're doing now. Just replace California and New York with India or China and New York with, well New York, or Washington, and that's exactly the system we have. That's the system the EU is trying to create in the EU. Doesn't work that way for exports (EU, or China, or to a lesser extent, India). The EU is an export block that's rich getting out competed by export blocks that are poor ... Now THAT is a difficult problem to solve. Not that EU politicians are even trying. The US is not doing better because US politicians are better than EU ones. They just have a much easier problem to solve. And, of course, both US and EU politicians are failing, but the consequences are much bigger in the EU. For example, the EU is in fact making it harder to immigrate WITHIN the block, despite "free movement", and is creating massive differences in pay for the same work, which is apparently what socialism stands for: Typical after-tax pay for supermarket cashier: Netherlands: 2550 euro (after tax), for 36 hours of work ~ 15 euro/hour Greece: 1050 euro (after tax), for 40 hours of work ~ 6 euro/hour Oh and that's not where it ends. You get way more social protection and medical in the Netherlands ... for paying less in tax. The EU is purposefully creating inequality to solve the problem of rich Dutch people not getting richer fast enough. It's only within the same country that there is less inequality in the EU. And, of course, the EU has been making it worse, not better, for about 18 years now. They're not about to stop. The US hasn't even decently started doing this yet.
lljk_kennedy 3mo ago
[citation needed]
fspoettel 3mo ago
Europe generates ~20% of revenue for US big tech which is a large part of its stock market. With how precariously coupled US growth is to these companies, it absolutely needs that market.
- sajithdilshan 3mo ago
  But can the Europe survive without the US big tech. Imagine the worst case US bans any sort of export from big tech to Europe, all startups and even every tech reliant company in EU would collapse without AWS, Azure or Google cloud. Also imagine ban on exports from Apple and Google, from tomorrow onwards both iPhones and Android phones stops working because software services are banned in EU. It’s so easy to argue on putting tariff on US tech, but we forget how much Europeans depend on it and it would be like shooting one’s own foot. One could argue that over the time EU can build their own infrastructure and alternative, but who is going to invest for it? The governments? With tax payers money? And who is going to build it? EU is one of the fastest aging continent in the world and what can they offer to attract young talent?
  - iririririr 3mo ago
    that would actually spark a new golden age. aws et all are just extracting rent. we all know this. telcos have some ownership of the android firmware they distribute, and could easily spin up and fund alternatives like replicant or even go full partnership with Chinese versions. simply moving email providers from Microsoft would make threeletter agencies work much more difficult, and it's a 2min dns change. any way you look at it, the impact would be positive. i don't think your example is the example you think it is. like trump, you're ignoring agency to every other player in the systems and ignoring some obvious consequences.
    - sajithdilshan 3mo ago
      Either you’re stupid or ignorant. What do you mean by easily spin up alternative android? And who is going to fund that? EU spend millions of Euros for a corona Warn app, and spinning an android alternative would cost billions, with tax payers money. Also everyone that uses iPhones, what are they going to do? Are they gonna get free android phones? Forget about phones, all the companies that uses RDS would lose their data and that would be catastrophic.
FranzFerdiNaN 3mo ago
America has to be careful not to push Europe into the direction of China though. And with how Trump acts that might happen sooner than they would like. Bullying like how Trump prefers to do only works until some point. Europe mostly seems to bet on America changing its tune again once Trump is gone but we have to wait and see if the rot in America hasnt set in too deep already.
- sajithdilshan 3mo ago
  Even if America pushes EU to be like China, they cannot be China. China is one country ruled by one law and in a unified vision. On the other hand EU is a band of 27 countries with different laws, different problems and different priorities. They couldn’t even agree on a response for Ukraine-Russian war and present a unified front and do you think they would present a unified front against Americans?
  - big_paps 3mo ago
    I think he meant : to be pushed towards China as a partner while moving away from the US.
    - spwa4 3mo ago
      And ... what will Europe do if America simply ... also moves to use China as a trading partner? Or just drops the EU goods entirely? It'll be unpopular for 1 or 2 years and then the US will be better off. The the EU will have to create 600 billion in new (dollar) revenue per year to compensate. They haven't successfully done that in 20+ years ...
sajithdilshan 3mo ago
European economy would implode without trading with US. The biggest economy in Europe, Germany; exports cars, pharmaceuticals and other high end machinery to US and the whole middle class in Germany relies on the jobs from those exports oriented companies
- makapuf 3mo ago
  You talk about Europe then only give Germany examples ..? Is that a German only problem ?
  - sajithdilshan 3mo ago
    Germany is the biggest economy in the Europe and the one that’s holding Euro stable ( France and Italy would soon be only serving their debt). If German economy goes down, then you can say goodbye to Euro
- gmueckl 3mo ago
  Cars are largely not exported to the US from Germany, but built in US factories. German car companies have factories all over the world.
- NorwegianDude 3mo ago
  To be fair, it would be a bigger issue for the US. No country is more economically dependant on the rest of the world than the US. The US is living on the USD, and if others stop using it the US would have to do extreme cuts on everything.
  - sajithdilshan 3mo ago
    That’s true, but every time a country or a group of country tried to do that US has stopped it either strategically or with military force so far.
    - NorwegianDude 3mo ago
      But you are talking about Europe. If the US and Europe were to cut all ties they would both face some serious consequences, and the US wouldn't be able to do anything about that, not strategically or military. The US need trust in order to function, and attacking would loose them all trust globally, making it much much more severe than anything any other nations would struggle with.
Mairoce 3mo ago
Ah yes, the classic “Europe is in decline” narrative favored by Americans. You’d think after more than a decade of that nonsense, people would start to ignore it or at least question its assumptions. Nominal GDP and venture capital funding are not the only things that matter in an economy.
- WarmWash 3mo ago
  Europe has no tech industry. It's largely floating on the same economy it had 50 years ago. The situation is beyond dire.
  - NorwegianDude 3mo ago
    Hey! We Norwegians have on average more ownership in US tech companies than Americans! Everything is going according to plan. When we have majority, we'll move the companies to Norway, but don't tell anyone, this is supposed to be a secret. /s
chiply314 3mo ago
What the Clown currently does is to push Europe massivly into exactly this. I can't find it right now but I read news just a few month ago that the EU is working on making it easier to invest into EU similiar to how the Petrodollar currently works. But if the deindustrialization of germany/EU continues as it currently does and US implodes and China has also issues, we will see how the new world order will look like. China is for sure more resiliant though. The living standards were never as high as what we as germans are used to and they dont demonstrate. In the USA people have guns and civil issues and a hard divide between city and country sides. But as Europe/Germany we should be able to increase our bonds right? Investing into solar/energy transformation; Doesn't matter short term how this will end. And if AI continues as it does with robotics, we might even see in 50-100 years a complete change in system? USA Bonds are exploding so they might have overplayed their hand already.

HexPhantom 3mo ago

It feels less like a pure tech market now and more like cloud, semiconductors and defense policy all getting mixed together

delta_p_delta_x 3mo ago
Military-technological industrial complex. Has always been a thing. Nascent WW2 computers were used for artillery, rocket, and bomb guiding.

grumple 3mo ago

Is the rest of the world really that dependent on emerging AI? I don’t think so. The US could cut off all foreign access to AI, nobody would notice.

basisword 3mo ago
It would definitely be a problem. A big one. Think of all the multi-national tech companies that have rolled out AI not only to their engineering teams but to their business teams now too. Suddenly your employees in the US can do more and do it quicker than your employees elsewhere. It would be a nightmare to try and manage.
- graemep 3mo ago
  That only applies to things Mythos does better than Opus. Mythos is supposedly very good at things such as finding vulnerabilities, but is it better at business tasks? IN the short time I had access to Fable it did not seem noticeably better at things I tried it for (lots of small tasks). Maybe it is better at vibe coding or finding security flaws, but at how much is it sufficiently better to be worth paying the extra?
  - basisword 3mo ago
    You're assuming this export restriction won't apply to any future models. The problem is a couple of years from now when the ROW is still on Opus and US workers are on something much better.
    - graemep 3mo ago
      Which would force us to use Chinese models instead. It would also increase the incentive for other countries to develop models.
- grumple 3mo ago
  I disagree. I work at a very large international corporation. How much revenue do you think we’ve seen due to AI? I’d guess it’s zero. I know for the groups whose finances I see, it’s zero. Yet costs have gone way up. There’s a bunch of new code, but not anything customers are going to pay more for. And either way no AI basically puts you back to where we were last year. US employees have always been far more productive, that’s nothing new.

pythux 3mo ago

It might not be a coincidence that POTUS wrote yesterday on Truth Social that 100% tariffs would be imposed on any country proceeding with taxing US' digital services.

chinathrow 3mo ago
Pure grift.
graemep 3mo ago
Empty threat conditional on something that will never happen. Most of the rest of the world is too heavily dependent on US digital services to tax them more heavily. From social media to hyperscaler's clouds the US is dominant and stuff will just stop working if they get taxed. There would be a huge pushback from businesses if their government increased the cost of things like AWS. Edit: edit to say tax more heavily
- masfuerte 3mo ago
  Eh? We already tax them. The UK is not alone in having a digital services tax.
  - graemep 3mo ago
    Sorry, meant tax more heavily. Uk's tax is 2% and limited to advertising and marketplace fees.
    - swarnie 3mo ago
      I'm happy to vote for anyone who can put an extra 0 on that, it would be nice for these companies to pay more tax than me one of these years....
      - dlahoda 3mo ago
        They already pay. How 10usd subscriptions become 10eur or 10£? Companies pay lawyers and beurocrats and accountants to operate.

Chance-Device 3mo ago

Yes, this is exactly the implication. The decoupling of economies between those that have advanced AI, those who do not, and those who decide to ban AI outright or above a certain level of capacity.

mantas 3mo ago

The rest of the world already has quite a few restrictions.

_heimdall 3mo ago

This is far from a new challenge though. Another recent example, China has an advantage on cost of labor and manufacturing, and lack of enforcement of IP rights. They can produce for much cheaper than many other countries but it hasn't led to everyone banning trade with them.

epolanski 3mo ago
What part of China has cheap qualified labor? Skilled engineers nowadays demand between southern and central European prices at the very least.
- chiply314 3mo ago
  Cheap qualified labor doing machining for example. They def make less than in europe. You make very good money for working at Volkswagen on the line. And China now also has software developers and even if they make the same amount, they are def also now a big player in the game and take parts of the cake.
- deleted 3mo ago
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- _heimdall 3mo ago
  What type of roles are you considering? Look into their manufacturing, for example. They make all kinds of heavy machineryat costs much lower than US prices, as far as I understand a big contributor is labor costs. Its also worth noting that st southern and central European labor costs they would still have an advantage over the US.

sajithdilshan 3mo ago

One would have to have leverage to put tariff on US and not worry about retaliation. Almost every country is tightly coupled with US, let it be trade or reliance on technology. I can only think of Russia that is decoupled from US at the moment and they are stuck with Putin that still lives with imperial mindset rather than actually being a rival to US

bootsmann 3mo ago
The US doesn’t have this leverage either, Trump is just uniquely willing to hurt his own country for his own idiosyncrasies. It is pretty established at this point that Americans were the most hurt by his tariffs.

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m3kw9 3mo ago

We don't need more fear mongering with AI, it already made a mess. Industries are not gonna fail, they fall behind, like how US doesn't share weapon tech or certain IP's. Plus you have China providing a close 2nd/3rd place LLM tech for free.

mrtksn 3mo ago

The incentive is that Americans are huge consumers and closing markets to US also means losing US markets, that's why Trump's taxation on Americans for imports(AKA tariffs) caused huge stir. That said, if the risk is not tolerable then it's not worth it and can be sacrificed. EU was fully on board to do that if Trump invaded Greenland and EU as rest of the world are aggressively diversifying. BTW EU will never have a "tech" industry in any meaningful size as long as US have access to EU markets, anyone who eventually got tech industry are those who blocked the US or were blocked by US. So if US keeps its course, in a few years we may end up with fragmented markets with US blocked out because the US is very unpopular but the current politicians everywhere including in the EU are very pro-US actually hoping that current situation is just a glitch, which is not aligned with what the general population demands and as a result the next elections they will align with anti-Americans.

outside1234 3mo ago

Worse, why would you ever take a dependency on a US company. Even China seems more trustworthy at this point.

varispeed 3mo ago

You are assuming that governments care and are not corrupt. I think they have very little room for manoeuvre - companies like AWS or Microsoft can simply you are too cocky and we will shutdown infrastructure your country is running on if you don't bend the knee.

_3u10 3mo ago

They don’t, they wouldn’t need tariffs if they did. America mostly produces cheaper ag commodities than the EU but more expensive than South America. Deepseek is already a better search engine than Google. (Not sure if it does Google searches) Travel the world it’s not American companies gaining market share. I would especially recommend trying Chinese AI or riding in a BYD car and judging for yourself.

WarmWash 3mo ago

Its utterly unsurprising that in the reckoning of pro-socialist society (work less, tax more, live easy), the failure of European industry over the last 30 years, utterly unsurprising that the knee-jerk reaction is "You need to share your labor with all of us" rather than "We need to get our shit together and build a competitor" Europe isn't cooked because it lacks talent, there are untold smart capable people there, it's cooked because it built a social allergy to the very thing it needs most.

Balgair 3mo ago

> The world needs to act quick before their industries fail. It's a cost problem. If you want to try for a SOTA model, you're going to need to spend big time. Germany spent ~$115B last year on it's defense, roughly 2% of it's GDP. In contrast, ~$145B was spent last year just on AI infrastructure by Meta, and, well no one talks about Meta winning any AI races.

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mmooss 3mo ago

> If US companies have a large unfair advantage The US companies with access have a large unfair advantage over other US companies. Imagine being Rivian if Tesla gets access, Rocket Lab or Blue Origin others if SpaceX gets access, most of SV if major tech companies get access, ... imagine being a startup.