Sign up for the Slatest to get the most insightful analysis, criticism, and advice out there, delivered to your inbox daily.
As Big Tech closes out a year of favorable government treatment, artificial intelligence hype, and job cuts, some things are now beginning to appear a little bit … off.
Microsoft is reportedly failing to meet sales targets for all its fancy A.I. tools. OpenAI CEO Sam Altman just announced a companywide “Code Red” initiative to improve the models powering ChatGPT, which is staring down a mountain of lawsuits. Apple’s longtime A.I. chief is “retiring” from the gig as the company falls behind on A.I. goals. Oracle, the software giant whose founder’s presidential relations shot its stock to record levels, has a massive debt load that’s become pricier to insure, thanks in part to oft-repeated fears of an “A.I. Bubble.” (Perhaps that’s why the Oracle founder’s son, Paramount Skydance CEO David Ellison, is whining that his government-supported attempt to acquire Warner Bros. Discovery isn’t being considered fairly.) The cryptocurrency markets are adjusting from a hard crash-out—as is White House “A.I. and crypto czar” David Sacks, who’s still very upset about a recent New York Times investigation into his conflicts of interest and is leaning on his influential friends for support.
Another L for Sacks: The federal law he’s been pushing to override all state-level A.I. regulations has faced such backlash that it’s once again been withdrawn from congressional consideration, although its proponents will try again. Oh yeah, and the data center rush has also been negatively politicized, with Dems benefiting from a backlash to the ensuing power-cost spikes and drainage of local water. Meanwhile, Meta is making more cuts to its metaverse division while wiping its brow from a hard-fought legal victory with the Federal Trade Commission—a lawsuit that it was forced to contest even after CEO Mark Zuckerberg tried hard to make it go away. (By the way, the TikTok “deal” still hasn’t happened.)
This isn’t where Big Tech was supposed to be at the end of Trump 2.0’s first year. When the Bay Area’s most red-pilled titans decided to cast their lot in with Donald Trump, they soon grew so close to their onetime nemesis that they influenced much of the makeup of his new administration, along with its executive orders and proposed laws and generally lenient stance toward crony corruption. They’ve gotten a lot in turn, with Altman even gaining the power to stop Trump from sending the National Guard into San Francisco; they all stand to reap more benefits as Trump continues his deregulatory, personalist, tech-friendly reign.
So why does this year of triumph for the United States’ right-winged techies feel so … bleak? The president to whom they’ve attached themselves is less popular than ever. Chatter around a potentially catastrophic A.I. bubble burst is voluminous as the wild valuations and circular investments in the sector played an outsize role in holding up Trump 2.0’s chaotic economy. The mission of global supremacy in A.I. has been undermined amid all the trade-war sparring, as Chinese models suffuse the digital commons, and H-1B visa immigrant workers, facing a new and onerous U.S.-entry tax, take their talents to other nations.
Is it possible that the Trump-tech embrace worked too well, granting the A.I. sector enough room to prematurely hit the ceiling? Or did the techies overplay their hand? When OpenAI’s CFO suggested in a conference last month that their massive investments could be cushioned by a federal “backstop” if things don’t work out, even Sacks had to step in to say there’d be no top-down “bailout” for these firms. He could be just saying whatever; this is the same guy who was demanding that all Silicon Valley Bank investors be made whole by the feds as the bloated financial house collapsed in 2023. But it suggests that even the most optimistic of techno-optimists are realizing there’s only so much further they can go at this rapid, overvalued pace—and that, at the very least, a not-insignificant popular or economic correction is coming due.
There’s already been much analysis and warning of a potential A.I. burst; I’m not here to reiterate the possibility or speculate on the exact consequences. What I see here is more of a gradual—if tacit—understanding that the Trump premium has burned rather quickly. However widely ChatGPT has been adopted, and however elevated the promises of our techno-future, popular reception of generative A.I. outside of the tech world does not reflect utopian thinking. While machine learning and other technical processes that contribute to generative A.I. continue to make amazing breakthroughs (e.g., for wildlife preservation and disaster preparation), it’s mostly understood that text, image, and video generators are being used to scam other people, appropriate others’ likenesses, drive oneself into psychosis, keep the boomers on Facebook placated, and make excuses to cut jobs. No one even bothers to hide the criminality and theft of their use anymore, and it’s been mighty offputting—to the point that guides for opting yourself out of generative-tool additions regularly make the rounds online, and the executives who brute-forced such tools into being (e.g., Peter Thiel, Alex Karp, Elon Musk) are mocked and memed across social media.
There’s trouble within paradise, too. The tech-and-MAGA-base alliance was already fragile from jump, with various in-group ideological disputes playing out on extremely public stages: support for versus opposition of immigrant workers, enthusiasm for mass surveillance versus an allergy to the concept, wholesale government destruction versus basic aspects of federal functionality, subsidization of the entire cryptosphere versus realization of the founding ideals of Bitcoin. Trump’s coalition did not paper over these differences but only aggravated them; there’s a reason that his empowered ethnonationalist base is already looking beyond Trump, and beyond the techies he leaned upon to return to power.
If the infamous “zero interest rate policy” supercharged Silicon Valley’s 2010s boom, then the era of high interest rates has seen the sector’s venture capitalists and investors seize upon A.I. in a dying gasp of air. But just as ZIRP had to end eventually, so will the A.I. hype cycle, even as its products continue to live with us. For the sad Big Tech Bros, the party can only go on for so long, and Trump has to worry about midterms next year.
Get the best of news and politics
Sign up for Slate’s evening newsletter.
