Amazon Plans to Replace More Than Half a Million Jobs With Robots

[ed. Amazon announces 14000 job cuts - 10/28/2025]

Over the past two decades, no company has done more to shape the American workplace than Amazon. In its ascent to become the nation’s second-largest employer, it has hired hundreds of thousands of warehouse workers, built an army of contract drivers and pioneered using technology to hire, monitor and manage employees.

Now, interviews and a cache of internal strategy documents viewed by The New York Times reveal that Amazon executives believe the company is on the cusp of its next big workplace shift: replacing more than half a million jobs with robots.

Amazon’s U.S. work force has more than tripled since 2018 to almost 1.2 million. But Amazon’s automation team expects the company can avoid hiring more than 160,000 people in the United States it would otherwise need by 2027. That would save about 30 cents on each item that Amazon picks, packs and delivers to customers.

Executives told Amazon’s board last year that they hoped robotic automation would allow the company to continue to avoid adding to its U.S. work force in the coming years, even though they expect to sell twice as many products by 2033. That would translate to more than 600,000 people whom Amazon didn’t need to hire.

At facilities designed for superfast deliveries, Amazon is trying to create warehouses that employ few humans at all. And documents show that Amazon’s robotics team has an ultimate goal to automate 75 percent of its operations.

Amazon is so convinced this automated future is around the corner that it has started developing plans to mitigate the fallout in communities that may lose jobs. Documents show the company has considered building an image as a “good corporate citizen” through greater participation in community events such as parades and Toys for Tots.

The documents contemplate avoiding using terms like “automation” and “A.I.” when discussing robotics, and instead use terms like “advanced technology” or replace the word “robot” with “cobot,” which implies collaboration with humans. (...)

Amazon’s plans could have profound impact on blue-collar jobs throughout the country and serve as a model for other companies like Walmart, the nation’s largest private employer, and UPS. The company transformed the U.S. work force as it created a booming demand for warehousing and delivery jobs. But now, as it leads the way for automation, those roles could become more technical, higher paid and more scarce.

“Nobody else has the same incentive as Amazon to find the way to automate,” said Daron Acemoglu, a professor at the Massachusetts Institute of Technology who studies automation and won the Nobel Prize in economic science last year. “Once they work out how to do this profitably, it will spread to others, too.”

If the plans pan out, “one of the biggest employers in the United States will become a net job destroyer, not a net job creator,” Mr. Acemoglu said.

The Times viewed internal Amazon documents from the past year. They included working papers that show how different parts of the company are navigating its ambitious automation effort, as well as formalized plans for the department of more than 3,000 corporate and engineering employees who largely develop the company’s robotic and automation operations. (...)

A Template for the Future

For years, Jeff Bezos, Amazon’s founder and longtime chief executive, pushed his staff to think big and envision what it would take to fully automate its operations, according to two former senior leaders involved in the work. Amazon’s first big push into robotic automation started in 2012, when it paid $775 million to buy the robotics maker Kiva. The acquisition transformed Amazon’s operations. Workers no longer walked miles crisscrossing a warehouse. Instead, robots shaped like large hockey pucks moved towers of products to employees.

The company has since developed an orchestrated system of robotic programs that plug into each together like Legos. And it has focused on transforming the large, workhorse warehouses that pick and pack the products customers buy with a click.

Amazon opened its most advanced warehouse, a facility in Shreveport, La., last year as a template for future robotic fulfillment centers. Once an item there is in a package, a human barely touches it again. The company uses a thousand robots in Shreveport, allowing it to employ a quarter fewer workers last year than it would have without automation, documents show. Next year, as more robots are introduced, it expects to employ about half as many workers there as it would without automation.

“With this major milestone now in sight, we are confident in our ability to flatten Amazon’s hiring curve over the next 10 years,” the robotics team wrote in its strategy plan for 2025.

Amazon plans to copy the Shreveport design in about 40 facilities by the end of 2027, starting with a massive warehouse that just opened in Virginia Beach. And it has begun overhauling old facilities, including one in Stone Mountain near Atlanta.

That facility currently has roughly 4,000 workers. But once the robotic systems are installed, it is projected to process 10 percent more items but need as many as 1,200 fewer employees, according to an internal analysis. Amazon said the final head count was subject to change. (...)

Amazon has said it has a million robots at work around the globe, and it believes the humans who take care of them will be the jobs of the future. Both hourly workers and managers will need to know more about engineering and robotics as Amazon’s facilities operate more like advanced factories.

by Karen Weise, NY Times | Read more:
Image: Emily Kask
[ed. Everyone knew this was coming, now it's here. I expect issues like universal basic income, healthcare for all, even various forms of democratic socialism (which I support) getting more attention soon. See also: What Amazon’s 14,000 job cuts say about a new era of corporate downsizing (WaPo via Seattle Times); and, The AI job cuts are here - or are they? (BBC).]

College Football: Big Money, Big Troubles

College football programs could spend $200 million in buyouts. Spare us the money moaning.

If you watched college football on Saturday, you saw yet another set of misleading political ads urging you to call your local congressman and tell them to SAVE COLLEGE SPORTS! The latest ones give the impression that women’s and Olympic sports are in trouble because having to pay athletes a salary is going to bankrupt their schools.

On Sunday, Penn State announced it has fired 12th-year coach James Franklin, for whom they now owe a roughly $45 million buyout.

These schools aren’t broke. They’re just wildly irresponsible spenders.

And if they find a private equity firm to come rushing to their rescue, as the Big Ten is actively seeking, they’ll just find a way to light that money on fire, too.

We’re only halfway through the 2025 regular season, and it’s clear we’re headed to a full-on coaching carousel bloodletting. Stanford (Troy Taylor), UCLA (DeShaun Foster), Virginia Tech (Brent Pry), Oklahoma State (Mike Gundy), Arkansas (Sam Pittman), Oregon State (Trent Bray) and now Penn State have already sent their guys packing, and the likes of Florida (Billy Napier), Wisconsin (Luke Fickell) and several more will likely come.

By year’s end, the combined cost of those buyouts could well exceed $200 million. Let that sink in for a second. Supposed institutions of “higher learning” have managed to negotiate themselves into paying $200 million to people who will no longer be working for them.

Just how much is $200 million? Well, for one thing, it’s enough to pay for the scholarships of roughly 5,000 women’s and Olympic sports athletes.

You may be asking yourself: How do schools keep entering into these ridiculous, one-sided coaching contracts that cost more than the House settlement salary cap ($20.5 million) to extricate themselves from?

Well, consider the dynamics at play in those negotiations.

On one side of the table, we have an athletics director who spends 95 percent of their time on things like fundraising, marketing, facilities, answering fan emails about the long lines of concession stands, and so on. Once every four or five years, if that, they have to hire or renew a highly paid football coach, often in the span of 24 to 48 hours.

And on the other side, we have Jimmy Sexton. Or Trace Armstrong. Or another super-agent whose sole job is to negotiate lucrative coaching contracts. It’s a bigger mismatch than Penn State-UCLA … uh, Penn State-Northwestern … uh … you know what I mean.

Franklin’s extremely one-sided contract is a perfect example. (...)

Coaching salaries have been going up and up for decades, of course, but that 2021-22 cycle reached new heights in absurdity. In addition to Franklin’s windfall, USC gave Oklahoma’s Riley a 10-year, $110 million contract, and LSU gave Brian Kelly a 10-year, $95 million deal; and the most insane of all, Michigan State’s 10-year, $75 million deal for the since-fired Mel Tucker.

As of today, none of the four schools has gotten the return they were seeking. (...)

Now, according to USA Today’s coaching salary database published last week, none of the 30 highest-paid coaches in the country have a buyout of less than $20 million.

In the past, we might have just rolled our eyes, proclaimed, “You idiots!” and moved on. But the current college sports climate all but demands that there needs to be more accountability of the people making these deals.

by Stewart Mandel, The Athletic | Read more:
Image: Alex Slitz/Getty

[ed. I don't follow college football much, but from what I do pick up it seems like the transfer portal, NIL, legitimized sports gambling, conference reorganizations, big media money, and who knows what else have really had an overall negative effect on the sport, resulting in an ugly mercenary ethic that's now common. See also: College football is absolutely unhinged right now. It’s exactly why we love it; and, Bill Belichick pledged an NFL approach at North Carolina. Program insiders call it dysfunctional (The Athletic). 

Then there's this: College football’s ‘shirtless dudes’ trend is all the rage. And could be curing male loneliness? Can't see the connection but imagine women sure as hell won't be sitting anywhere near these guys. Don't think that's going to help with the loneliness problem.]  

China OS vs. America OS

Xu Bing, installation view of Tianshu (Book From the Sky), 1987–1991, at Ullens Center for Contemporary Art, Beijing, 2018.

via:

[ed. See: China OS vs. America OS (Concurrent):]

"China and America are using different versions of operating systems. This OS can be understood as a combination of software and hardware. Du Lei pointed out that China has faster hardware updates, but has many problems on the software side. I think this metaphor is particularly fitting.

I'd like to start by having you both share your understanding of what constitutes China's OS versus America's OS. One interpretation is: America continues to rely on email and webpage systems for government services, while China has adopted the more efficient WeChat platform (where almost all civic services can be quickly completed). The hardware gap is striking: China's high-speed rail system represents the rapid flow of resources within its system, while America's infrastructure remains at a much older level. It's as if China has upgraded its hardware with several powerful chips, greatly accelerating data transmission, while America still operates at 20th-century speeds. (...)

China operates with high certainty about the future while maintaining a pessimistic outlook, which significantly shapes its decision-making processes. In contrast, American society tends to be optimistic about the future but lacks a definite vision for how that future should unfold.

Based on these different expectations about the future, the two countries produce completely different decision-making logic. For example, if China's expectations about the future are both definite and pessimistic, it would conclude: future resources are limited, great power competition is zero-sum. If I don't compete, resources will be taken by you; if I don't develop well, you will lead. This expectation about the future directly influences China's political, military, economic, and technological policies.

But if you're optimistic about the future, believing the future is abundant, thinking everyone can get a piece of the pie, then you won't be so urgent. You'll think this is a positive-sum game, the future can continue developing, everyone can find their suitable position, with enough resources to meet everyone's needs.

I think China and America don't have such fundamental differences, but their expectations about the future have huge disparities. This disparity ultimately leads to different decisions with far-reaching impacts."

Soybean Socialism

They’re Small, Yellow and Round — and Show How Trump’s Tariffs Don’t Work

Once again, President Trump says he’s preparing an emergency bailout for struggling farmers. And once again, it’s because of an emergency he created.

China has stopped buying U.S. soybeans to protest Mr. Trump’s tariffs on imports. In response, Mr. Trump plans to send billions of dollars of tariff revenue to U.S. soybean farmers who no longer have buyers for their crops. At the same time, Argentina has taken advantage of Mr. Trump’s tariffs to sell more of its own soybeans to China — yet Mr. Trump is planning to bail out Argentina, too.

This may seem nonsensical, especially since Mr. Trump already shoveled at least $28 billion to farmers hurt by his first trade war in 2018. But it actually makes perfect sense. It’s what happens when Mr. Trump’s zero-sum philosophy of trade — which is that there are always winners and losers, and he should get to choose the winners — collides with Washington’s sycophantic approach to agriculture, which ensures that farmers always win and taxpayers always lose. In the end, Mr. Trump’s allies, including President Javier Milei of Argentina and the politically influential agricultural community, will get paid, and you will pay. (...)

In theory, Mr. Trump’s tariffs on foreign products ranging from toys to cars to furniture are supposed to encourage manufacturers to move operations from abroad to the United States. They haven’t had that effect, because the tariffs have jacked up the price of steel and other raw materials that U.S. manufacturers still need to import, triggered retaliatory tariffs from China and other countries and created a volatile trade environment that makes investing in America risky. At the same time, higher tariffs mean higher prices for U.S. consumers, even though Mr. Trump insists that only foreigners absorb the costs. (...)

Of course, farmers have been among Mr. Trump’s most loyal supporters, and these days they’re distraught that rather than make agriculture great again, the president has chased away their biggest soybean buyer. They’re especially irate that Mr. Trump pledged to rescue Argentina the same day Mr. Milei suspended its export tax on soybeans, making it more attractive for China to leave U.S. farmers in the lurch. Mr. Trump even admitted that the $20 billion Argentine bailout won’t help America much, that it’s a favor for an embattled political ally who’s “MAGA all the way.”

But American farmers were distraught about his last trade war, too, until he regained their trust with truckloads of cash. They say that this time they don’t want handouts, just open markets and a level playing field, but in the end they’ll accept the handouts while less powerful business owners victimized by tariffs will get nothing. Mr. Trump initially promised to use his tariff revenue to pay down the national debt to benefit all Americans, but he’ll take care of farmers first.

In fact, “Farmers First” is the motto of Mr. Trump’s Department of Agriculture, and the upcoming bailout won’t be even his first effort this year to redirect money from taxpayers to soybean growers. His Environmental Protection Agency has proposed to mandate two billion additional gallons of biodiesel, a huge giveaway to soy growers. His “big, beautiful bill” also included lucrative subsidies for soy-based biodiesel, which drives deforestation abroad and makes food more expensive but could provide a convenient market for unwanted grain.

Democrats have been airing ads blaming Mr. Trump’s tariffs for the pain in soybean country, and they’ve started attacking the Argentina bailout as well. But most of them aren’t complaining about his imminent farm bailout, and his recent biofuel boondoggles have bipartisan support. Mr. Trump’s incessant pandering to the farmer-industrial complex is one of the most conventional Beltway instincts he has. And it has worked for him politically; even now that crop prices are plunging and soybeans have nowhere to go, rural America remains the heart of his base.

I’ve argued that Democrats can’t out-agri-pander Mr. Trump in rural America, and now that the president has posted a meme of himself dumping on urban America, there’s never been a better time to stop trying. Mr. Trump has committed to a destructive mix of tariffs, bailouts, biofuels mandates and immigration crackdowns that will make consumers pay more for food and saddle taxpayers with more debt. It’s a bizarre combination of crony capitalism and agricultural socialism. It’s all the worst elements of big government.

by Michael Grunwald, NY Times |  Read more:
Image: Antonio Giovanni Pinna
[ed. One of my pet peeves. Almost 40 years of subsidies, with most of the money going to Big Ag (which is busy squeezing and consolidating small farms out of sight). See also: Take a Hard Look at One Agency Truly Wasting Taxpayer Dollars (NYT):]

There’s one bloated federal government agency that routinely hands out money to millionaires, billionaires, insurance companies and even members of Congress. The handouts are supposed to be a safety net for certain rural business owners during tough years, but thousands of them have received the safety-net payments for 39 consecutive years...

Even though only 1 percent of Americans farm, the U.S.D.A. employs five times as many people as the Environmental Protection Agency and occupies nearly four times as many offices as the Social Security Administration. (...)

But the real problem with the U.S.D.A. is that its subsidy programs redistribute well over $20 billion a year from taxpayers to predominantly well-off farmers. Many of those same farmers also benefit from subsidized and guaranteed loans with few strings attached, price supports and import quotas that boost food prices, lavish ad hoc aid packages after weather disasters and market downturns as well as mandates to spur production of unsustainable biofuels. A little reform to this kind of welfare could go a long way toward reassuring skeptics that the administration’s efficiency crusade isn’t only about defunding its opponents and enriching its supporters.

The Shadow President

On the afternoon of Feb. 12, Russell Vought, the director of the White House Office of Management and Budget, summoned a small group of career staffers to the Eisenhower Executive Office Building for a meeting about foreign aid. A storm had dumped nearly 6 inches of snow on Washington, D.C. The rest of the federal government was running on a two-hour delay, but Vought had offered his team no such reprieve. As they filed into a second-floor conference room decorated with photos of past OMB directors, Vought took his seat at the center of a worn wooden table and laid his briefing materials out before him.

Vought, a bookish technocrat with an encyclopedic knowledge of the inner workings of the U.S. government, cuts an unusual figure in Trump’s inner circle of Fox News hosts and right-­wing influencers. He speaks in a flat, nasally monotone and, with his tortoiseshell glasses, standard-issue blue suits and corona of close-cropped hair, most resembles what he claims to despise: a federal bureaucrat. The Office of Management and Budget, like Vought himself, is little known outside the Beltway and poorly understood even among political insiders. What it lacks in cachet, however, it makes up for in the vast influence it wields across the government. Samuel Bagenstos, an OMB general counsel during the Biden administration, told me, “Every goddam thing in the executive branch goes through OMB.”

The OMB reviews all significant regulations proposed by individual agencies. It vets executive orders before the president signs them. It issues workforce policies for more than 2 million federal employees. Most notably, every penny appropriated by Congress is dispensed by the OMB, making the agency a potential choke point in a federal bureaucracy that currently spends about $7 trillion a year. Shalanda Young, Vought’s predecessor, told me, “If you’re OK with your name not being in the spotlight and just getting stuff done,” then directing the OMB “can be one of the most powerful jobs in D.C.”

During Donald Trump’s first term, Vought (whose name is pronounced “vote”) did more than perhaps anyone else to turn the president’s demands and personal grievances into government action. In 2019, after Congress refused to fund Trump’s border wall, Vought, then the acting director of the OMB, redirected billions of dollars in Department of Defense money to build it. Later that year, after the Trump White House pressured Ukraine’s government to investigate Joe Biden, who was running for president, Vought froze $214 million in security assistance for Ukraine. “The president loved Russ because he could count on him,” Mark Paoletta, who has served as the OMB general counsel in both Trump administrations, said at a conservative policy summit in 2022, according to a recording I obtained. “He wasn’t a showboat, and he was committed to doing what the president wanted to do.”

After the pro-Trump riots at the U.S. Capitol on Jan. 6, 2021, many Republicans, including top administration officials, disavowed the president. Vought remained loyal. He echoed Trump’s baseless claims about election fraud and publicly defended people who were arrested for their participation in the melee. During the Biden years, Vought labored to translate the lessons of Trump’s tumultuous first term into a more effective second presidency. He chaired the transition portion of Project 2025, a joint effort by a coalition of conservative groups to develop a road map for the next Republican administration, helping to draft some 350 executive orders, regulations and other plans to more fully empower the president. “Despite his best thinking and the ­aggressive things they tried in Trump One, nothing really stuck,” a former OMB branch chief who served under Vought during the first Trump administration told me. “Most administrations don’t get a four-year pause or have the chance to think about ‘Why isn’t this working?’” The former branch chief added, “Now he gets to come back and steamroll everyone.”

At the meeting in February, according to people familiar with the events, Vought’s directive was simple: slash foreign assistance to the greatest extent possible. The U.S. government shouldn’t support overseas anti-malaria initiatives, he argued, because buying mosquito nets doesn’t make Americans safer or more prosperous. He questioned why the U.S. funded an international vaccine alliance, given the anti-vaccine views of Trump’s nominee for secretary of Health and Human Services, Robert F. Kennedy Jr. The conversation turned to the United States Institute of Peace, a government-­funded nonprofit created under Ronald Reagan, which worked to prevent conflicts overseas; Vought asked what options existed to eliminate it. When he was told that the USIP was funded by Congress and legally independent, he replied, “We’ll see what we can do.” (A few days later, Trump signed an executive order that directed the OMB to dismantle the organization.)

The OMB staffers had tried to anticipate Vought’s desired outcome for more than $7 billion that the State Department and the U.S. Agency for International Development spent each year on humanitarian assistance, ­including disaster relief and support for refugees and conflict victims. During the campaign, Trump had vowed to defund agencies that give money to people “who have no respect for us at all,” and Project 2025 had accused USAID of pursuing a “divisive political and cultural agenda.” The staffers proposed a cut of 50%.

Vought was unsatisfied. What would be the consequences, he asked, of a much larger reduction? A career official answered: Less humanitarian aid would mean more people would die. “You could say that about any of these cuts,” Vought replied. A person familiar with the ­meeting described his reaction as “blasé.” Vought reiterated that he wanted spending on foreign aid to be as close to zero as possible, on the fastest timeline possible. Several analysts left the meeting rattled. Word of what had happened spread quickly among the OMB staff. ­Another person familiar with the meeting later told me, “It was the day that broke me.”

What Vought has done in the nine months since Trump took office goes much further than slashing foreign aid. Relying on an expansive theory of presidential power and a willingness to test the rule of law, he has frozen vast sums of federal spending, terminated tens of thousands of federal workers and, in a few cases, brought entire agencies to a standstill. In early October, after Senate Democrats refused to vote for a budget resolution without additional health care protections, effectively shutting down the government, Vought became the face of the White House’s response. On the second day of the closure, Trump shared an AI-generated video that depicted his budget director — who, by then, had threatened mass firings across the federal workforce and paused or canceled $26 billion in funding for infrastructure and clean-­energy projects in blue states — as the Grim Reaper of Washington, D.C. “We work for the president of the United States,” a senior agency official who regularly deals with the OMB told me. But right now “it feels like we work for Russ Vought. He has centralized decision-­making power to an extent that he is the commander in chief.”

by Andy Kroll, Pro Publica |  Read more:

Image: Evan Vucci/AP
[ed. It wasn't as if Republicans in Congress had any illusions about Vought and his agenda when they confirmed him for the OMB job. Except one: miscalculating how quickly they'd become roadkill themselves. See also: What You Should Know About Russ Vought, Trump’s Shadow President.]

America's Future Could Hinge on Whether AI Slightly Disappoints

A burning question that’s on a lot of people’s minds right now is: Why is the U.S. economy still holding up? The manufacturing industry is hurting badly from Trump’s tariffs, the payroll numbers are looking weak, and consumer sentiment is at Great Recession levels:

And yet despite those warning signs, there has been nothing even remotely resembling an economic crash yet. Unemployment is rising a little bit but still extremely low, while the prime-age employment rate — my favorite single indicator of the health of the labor market — is still near all-time highs. The New York Fed’s GDP nowcast thinks that GDP growth is currently running at a little over 2%, while the Atlanta Fed’s nowcast puts it even higher.

One possibility is that everything is just fine with the economy — that Trump’s tariffs aren’t actually that high because of all the exemptions, and/or that economists are exaggerating the negative effects of tariffs in the first place. Weak consumer confidence could be a partisan “vibecession”, payroll slowdown could be from illegal immigrants being deported or leaving en masse, and manufacturing’s woes could be from some other sector-specific factor.

Another possibility is that tariffs are bad, but are being canceled out by an even more powerful force — the AI boom. The FT reports:

Pantheon Macroeconomics estimates that US GDP would have grown at a mere 0.6 per cent annualised rate in the first half were it not for AI-related spending, or half the actual rate.

Paul Kedrosky came up with similar numbers. Jason Furman does a slightly different calculation, and arrives at an even starker number: [ed. 0.1 percent]

And here’s an impressive chart:

The Economist writes:

[L]ook beyond AI and much of the economy appears sluggish. Real consumption has flatlined since December. Jobs growth is weak. Housebuilding has slumped, as has business investment in non-AI parts of the economy[.]

And in a post entitled “America is now one big bet on AI”, Ruchir Sharma writes that “AI companies have accounted for 80 per cent of the gains in US stocks so far in 2025.” In fact, more than a fifth of the entire S&P 500 market cap is now just three companies — Nvidia, Microsoft, and Apple — two of which are basically big bets on AI.

Now as Furman points out, this doesn’t necessarily mean that without AI, the U.S. economy would be stalling out. If the economy wasn’t pouring resources into AI, it might be pouring them into something else, spurring growth that was almost as fast as what we actually saw. But it’s also possible that without AI, America would be crashing from tariffs. (...)

But despite Trump’s tariff exemptions, the AI sector could very well crash in the next year or two. And if it does, it could do a lot more than just hurt Americans’ employment prospects and stock portfolios.

If AI is really the only thing protecting America from the scourge of Trump’s tariffs, then a bust in the sector could change the country’s entire political economy. A crash and recession would immediately flip the narrative on Trump’s whole presidency, much as the housing crash of 2008 cemented George W. Bush’s legacy as a failure. And because Trump’s second term is looking so transformative, the fate of the AI sector could potentially determine the entire fate of the country.

by Noah Smith, Noahpinion |  Read more:

Image: Derek Thompson/Bridgewater

Robotics Has Catapulted Beijing Into a Dominant Position

Western executives who visit China are coming back terrified.

“It’s the most humbling thing I’ve ever seen,” said Ford’s chief executive about his recent trip to China.

After visiting a string of factories, Jim Farley was left astonished by the technical innovations being packed into Chinese cars – from self-driving software to facial recognition.

“Their cost and the quality of their vehicles is far superior to what I see in the West,” Farley warned in July.

“We are in a global competition with China, and it’s not just EVs. And if we lose this, we do not have a future at Ford.”

The car industry boss is not the only Western executive to have returned shaken following a visit to the Far East.

Andrew Forrest, the Australian billionaire behind mining giant Fortescue – which is investing massively in green energy – says his trips to China convinced him to abandon his company’s attempts to manufacture electric vehicle powertrains in-house.

“I can take you to factories [in China] now, where you’ll basically be alongside a big conveyor and the machines come out of the floor and begin to assemble parts,” he says.

“And you’re walking alongside this conveyor, and after about 800, 900 metres, a truck drives out. There are no people – everything is robotic.”

Other executives describe vast, “dark factories” where robots do so much of the work alone that there is no need to even leave the lights on for humans.

“We visited a dark factory producing some astronomical number of mobile phones,” recalls Greg Jackson, the boss of British energy supplier Octopus.

“The process was so heavily automated that there were no workers on the manufacturing side, just a small number who were there to ensure the plant was working.

“You get this sense of a change, where China’s competitiveness has gone from being about government subsidies and low wages to a tremendous number of highly skilled, educated engineers who are innovating like mad.”

by Matt Oliver, Telegraph |  Read more:

Images: uncredited

[ed. Meanwhile we're busy turning people against each other and trying to bring back low-wage industrial jobs (that'll probably be obsolete in a few years if they aren't already). Guess who's got the momentum and strategic vision.]

Is it Really Different this Time?

What is amusing is just how much talk there has been about the AI investment bubble, and what it will do or not do to the markets and the economy when it implodes or doesn’t implode: That it’s almost like at the peak of the Dotcom Bubble. That it’s much worse than at the peak of the Dotcom Bubble. That it’s nothing like the Dotcom Bubble because this time it’s different. That even if it’s like the Dotcom Bubble and then turns into the Dotcom Bust, or worse, it’s still worth it because AI will be around and change the world, just like the Internet is still around and changed the world, even if those first investors got wiped out, or whatever.

There are many voices that loudly point this out, and point out just how risky it is to bet on hocus-pocus money, or that explain in detail why this isn’t risky at all, why this is not anything like the Dotcom Bubble, why this time it’s different – the four most dangerous words in investing.

The talk fills the spectrum, and these are people with enough stature to be quoted in the media: Jamie Dimon, Jeff Bezos, the Bank of England, Goldman Sachs analysts, IMF Managing Director Kristalina Georgieva…

The focus is on the big-tech-big-startup circularity of hocus-pocus deals between Nvidia, OpenAI, AMD, along with Amazon, Microsoft, Alphabet, Meta, Tesla, Oracle, and many others, including SoftBank, of course.

OpenAI now has an official “valuation” — based on its secondary stock offering — of $500 billion though it’s bleeding increasingly huge amounts of cash. And there are lots of players in between and around them. They all toss around announcements of AI hocus-pocus deals between them.

OpenAI has announced deals totaling $1 trillion with a small number of tech companies, at the top of which are Nvidia ($500 billion), Oracle ($300 billion), and AMD ($270 billion). Each of these announcements causes the stocks of these companies to spike massively – the direct and immediate effects of hocus-pocus money.

OpenAI obviously doesn’t have $1 trillion; it’s burning prodigious amounts of cash. And so it’s trying to rake in investment commitments from the same companies that it would buy equipment from, and engineer creative deals that cause these stock prices to spike, and so the hocus-pocus money announcements keep circulating.

OpenAI’s idea of building data centers with Nvidia GPUs that would require 10 gigawatts (GW) of power is just mindboggling. The biggest nuclear powerplant in the US, the Plant Vogtle in Georgia, with four reactors, including two that came on line in 2023 and 2024, has a generating capacity of about 4.5 GW. All nuclear powerplants in the US combined have a generating capacity of 97 GW.

But it’s real money too. A lot of real money.

Big Tech is letting its huge piles of cash spill out into the economy to build this vast empire of technology that requires data centers that would consume huge amounts of electricity to let AI do its thing.

And these “hyperscalers, are leveraging that money flow with borrowing, by issuing large amounts of bonds.

And private credit has jumped into the mania to provide further leverage, lending large amounts to data-center startup “neocloud” companies that plan to build data centers and rent out the computing power; those loans are backed with collateral, namely the AI GPUs. No one knows what a three-year-old used GPU, superseded by new GPUs, will be worth three years from now, when the lenders might want to collect on their defaulted loan, but that’s the collateral.

The data centers are getting built. The costs of the equipment in them – revenues for companies that provide this equipment and related services – dwarf the costs of the building. And stocks of companies that supply this equipment and the services have been surging.

The bottleneck is power, and funds are flowing into that, but it takes a long time to build powerplants and transmission infrastructure.

Is it really different this time?

So there is this large-scale industrial aspect of the AI investment bubble. That was also the case in the Dotcom Bubble. The telecom infrastructure needed to be built out at great cost. Fiberoptics made the internet what it is today. Those fibers needed to be drawn and turned into cables, and the cables needed to be laid across the world, and the servers, routers, and other equipment needed to be installed, and services were invented and provided, and businesses and households needed to be connected, and it was all real, and it was all very costly, requiring huge investments, but progress was slow and revenues lagging, and then these overhyped stocks just imploded under that weight, along with the stocks that were the pioneers of ecommerce, internet advertising, streaming, and whatnot.

The Nasdaq, where much of it was concentrated, plunged by 78% over a period of two-and-a-half years, investors lost huge amounts of money, many got wiped out, thousands of companies and their stocks vanished or were bought for scrap when that investment bubble crashed. And a year into the crash, it triggered a recession in the US – and a mini-depression in Silicon Valley and San Francisco where much of this had played out.

Yet the internet thrived. Amazon barely survived and then thrived in that new environment. But Amazon was one of the exceptions.

In this mania of hype, hocus-pocus deals, and huge amounts of real money fortified by leverage – all of which caused stock prices to explode – markets become edgy. Everyone is talking about it, everyone sees it, they’re all edgy, regardless of their narrative – whether a big selloff is inevitable with deep consequences on the US economy, or whether this time it’s different and the mania can go on and isn’t even halfway done.

Whatever the narrative, it says risk in all-caps. Anything can prod these stock prices at their precarious levels to suddenly U-turn, and if the selloff goes on long enough, the investment bubble would come to a halt, and the hocus-pocus deals would be just that, and the whole construct would come apart. But AI would still be around doing its thing, just like the Internet.

by Wolf Richter, Wolf Street |  Read more:
Image: Alexas_Fotos on Unsplash

[ed. See also: This Is How the AI Bubble Will Pop; and, a bonus: Condo Prices Dropped by 12%-27% in these 25 Bigger Cities through August: Condo Bust Update (WS).]

Way Past Its Prime

Sick of scrolling through junk results, AI-generated ads and links to lookalike products? It's not just you.

 
It’s not just you. The internet is getting worse, fast. The services we rely on, that we once loved? They’re all turning into piles of shit, all at once. Ask any Facebook user who has to scroll past 10 screens of engagement-bait, AI slop and surveillance ads just to get to one post by the people they are on the service to communicate with. This is infuriating. Frustrating. And, depending on how important those services are to you, terrifying.

In 2022, I coined a term to describe the sudden-onset platform collapse going on all around us: enshittification. To my bittersweet satisfaction, that word is doing big numbers. In fact, it has achieved escape velocity. It isn’t just a way to say something got worse. It’s an analysis that explains the way an online service gets worse, how that worsening unfolds, and the contagion that’s causing everything to get worse, all at once.

This moment we’re living through, this Great Enshittening, is a material phenomenon, much like a disease, with symptoms, a mechanism and an epidemiology. When doctors observe patients who are sick with a novel pathogen, their first order of business is creating a natural history of the disease. This natural history is an ordered catalogue of the disease’s progress: what symptoms do patients exhibit, and in which order?

Here’s the natural history of enshittification:

1. First, platforms are good to their users.
2. Then they abuse their users to make things better for their business customers.
3. Next, they abuse those customers to claw back all the value for themselves – and become a giant pile of shit.

This pattern is everywhere. Once you learn about it, you’ll start seeing it, too. Take Amazon, a company that started out by making it possible to have any book shipped to your door and then became the only game in town for everything else, even as it dodged taxes and filled up with self-immolating crapgadgets and other junk.

In Jeff Bezos’s original business plan for Amazon, the company was called Relentless. Critics say that this is a reference to Bezos’s cutthroat competitive instincts, but Bezos always insisted that it was a reference to his company’s relentless commitment to customer service.

How did Amazon go from a logistics company that got packages to you quickly and efficiently to a behemoth of digital content defined by the Prime experience (which has much less to do with free shipping now and more with everything else)?

Stage 1: good to users

Amazon started with a large surplus of cash that it was able to allocate to its customers, and allocate it did. The company raised a fortune from early investors, then a larger fortune by listing on the stock market. Then it used that fortune to subsidise many goods, selling them below cost. It also subsidised shipping and offered a no-questions-asked, postage-paid returns policy.

This offer tempted millions of users to pile on to the platform. Once they were there, Prime membership went a long way to locking them in. Paying for shipping a year in advance is a powerful incentive to do your shopping on Amazon. Indeed, the overwhelming majority of Prime subscribers begin their e-commerce searches on Amazon and, if they find what they’re looking for, don’t shop around for a better deal.

You can think of Prime as a form of soft lock-in, Amazon binding you to its platform with a silken ribbon. But Amazon’s also got some iron chains in its toolbox. All the audiobooks and movies, and most of the ebooks and emagazines, you buy from Amazon are permanently locked to its platform.

They are sold with digital rights management (DRM), a form of encryption designed to force you to view or listen using apps that Amazon controls. Break up with Amazon and delete your apps, and you will lose all the media you’ve ever bought from the platform. For a certain kind of reader, listener or movie buff, this is a very high switching cost indeed.

Amazon has one more trick up its sleeve: after years of selling goods below cost, it has completed the work that big box stores started, eliminating swaths of small, independent, brick-and-mortar businesses. Its online predatory pricing tactics have done the same for much of the e-commerce world.

That means shopping anywhere other than Amazon has become substantially more inconvenient. These tactics – Prime, DRM and predatory pricing – make it very hard not to shop at Amazon. With users locked in, to proceed with the enshittification playbook, Amazon needed to get its business customers locked in, too.

Stage 2: abusing users, good to businesses

Amazon was initially very good to those business customers. It paid full price for their goods, then sold them below cost to its customers. It subsidised returns and customer service, too. It ran a clean search engine, which put the best matches for shoppers’ queries at the top of the page, creating a path to glory merchants could walk merely by selling quality goods at fair prices.

Then, once those merchants were locked in, Amazon put the screws on them. Amazon brags about this technique, which it calls “the flywheel”. It brings in users with low prices and a large selection. This attracts merchants who are eager to sell to those users. The merchants’ dependence on those customers allows Amazon to extract higher discounts from those merchants, and that brings in more users, which makes the platform even more indispensable for merchants, allowing the company to require even deeper discounts – and around and around the flywheel spins.

Let’s take a step back. This flywheel is the direct product of a radical legal theory that has had the world in its grip since the late 1970s. From the 1890s until the Jimmy Carter administration, US corporations’ power was blunted by antitrust law, which treated large companies as threats simply because they were large. Once a company is too big to fail, it becomes too big to jail, and then too big to care. Antitrust law was designed to fight that apathy and force companies to care.

A rival – and frankly terrible – theory of antitrust law says that the only time a government should intervene against a monopolist is when it is sure that the monopolist is using its scale to raise prices or lower quality. This is the consumer welfare standard theory and its premise is that when we find monopolies in the wild, they are almost certainly large and powerful thanks to the quality of their offerings. Any time you find that people all buy the same goods from the same store, you should assume that this is the very best store, selling the very best goods. It would be perverse (goes the theory) for the government to harass companies for being so excellent that everyone loves them.

It was under this theory that Jimmy Carter started to remove a few of the Jenga blocks from the antitrust system. Then Ronald Reagan came along and tore them out by the fistful. (Most of the rightwing policies for which we remember Reagan started under Carter, who was hoping to woo conservative voters. He failed.) Every president since – Republican or Democrat – has followed Reagan’s example, up to (but not including) Joe Biden.

The Amazon flywheel is designed to fit neatly into the consumer welfare framework. It proclaims itself to be an enemy to merchants on behalf of consumers. The flywheel is all about lowering prices, and the consumer welfare standard theory prizes low prices above all else.

Stage 3: a giant pile of shit

Amazon has a myriad of tactics at its disposal for shifting value from business customers to itself, some of which also involve shifting value away from end users, no matter what the cute flywheel pitch says.

It uses its overview of merchants’ sales, as well as its ability to observe the return addresses on direct shipments from merchants’ contracting factories, to cream off its merchants’ bestselling items and clone them, relegating the original seller to page umpty-million of its search results.

Amazon also crushes its merchants under a mountain of junk fees pitched as optional but effectively mandatory. Take Prime: a merchant has to give up a huge share of each sale to be included in Prime, and merchants that don’t use Prime are pushed so far down in the search results, they might as well cease to exist.

Same with Fulfilment by Amazon, a “service” in which a merchant sends its items to an Amazon warehouse to be packed and delivered with Amazon’s own inventory. This is far more expensive than comparable (or superior) shipping services from rival logistics companies, and a merchant that ships through one of those rivals is, again, relegated even farther down the search rankings.

All told, Amazon makes so much money charging merchants to deliver the wares they sell through the platform that its own shipping is fully subsidised. In other words, Amazon gouges its merchants so much that it pays nothing to ship its own goods, which compete directly with those merchants’ goods. [ed. emphasis]

Here’s where Amazon’s attacks on its merchants’ bottom lines turn into higher prices for its customers. A merchant that pays Amazon through the nose needs to make up the money somewhere. Hypothetically, merchants could eat Amazon’s fees themselves – in other words, if Amazon wants a 10% fee on an item with a 20% profit margin, the seller could split the difference, and settle for a 10% profit.

But Amazon’s fee isn’t 10%. Add all the junk fees together and an Amazon seller is being screwed out of 45-51 cents on every dollar it earns there. Even if it wanted to absorb the “Amazon tax” on your behalf, it couldn’t. Merchants just don’t make 51% margins.

So merchants must jack up prices, which they do. A lot. Now, you may have noticed that Amazon’s prices aren’t any higher than the prices that you pay elsewhere. There’s a good reason for that: when merchants raise their prices on Amazon, they are required to raise their prices everywhere else, even on their own direct-sales stores. This arrangement is called most-favoured-nation status, and it’s key to the US Federal Trade Commission’s antitrust lawsuit against Amazon.

Let the implications of most-favoured nation settle in. If Amazon is taxing merchants 45-51 cents on every dollar they make, and if merchants are hiking their prices everywhere their goods are sold, then it follows you’re paying the Amazon tax no matter where you shop – even the corner mom-and-pop hardware store. [ed. emphasis]

It gets worse. On average, the first result in an Amazon search is 29% more expensive than the best match for your search. Click any of the top four links on the top of your screen and you’ll pay an average of 25% more than you would for your best match – which, on average, is located 17 places down in an Amazon search result.

Why does this happen? Because Amazon makes more than $50bn every year charging merchants for search placement. When you search for a product on Amazon, the top results aren’t the best matches: they’re the matches that pay the highest fees to Amazon to be top of the list.

Researchers Rory Van Loo and Nikita Aggarwal call this “Amazon’s pricing paradox”. Amazon gets to insist that it has the lowest prices in the business, but no one can find those prices. Instead, we all pay a massive Amazon tax every time we shop there, and the merchants we buy from are paying an Amazon tax, too.

That means that, on average, the stuff at the top of an Amazon search results page is bad. It’s low-quality, high-priced junk. Even when you’re buying a known quantity, such as a specific brand of AA batteries, the top item will usually be more expensive than the items lower down on the page – the ones without the splashy banners advertising “Best Seller” or “Amazon’s Choice”. The Amazon smile logo gets a lot more sinister when it appears next to a top search result that costs 29% more than the best match for your query, thanks to Amazon’s $50bn-a-year paid search placement.

by Cory Doctorow, The Guardian |  Read more:

Image: Noma Bar
[ed. I dropped Prime, and it's fine. The few things I order still have free (or miminal) shipping charges, and the movies (usually with additional rental fees) aren't missed at all.]

America Is Losing the Robotics Race

The impossible

AI is reshaping both soft power and hard power around the globe. The United States, to its credit, has an early lead with the former. The leading LLMs are trained on Western text, global training and inference are still dominated by American companies, and we are ahead in the global race for market share of total tokens generated.

But as it stands, China is running away with the hard power part of AI – robotics. As the incredible progress in AI continues, we start seeing intelligence embedded in the physical world – culminating in generalist robots that perform a wide variety of tasks across applications, from manufacturing to services to defense. This will redefine every aspect of our society and reshape daily life. The country betting on that future is China, not the US.

In the 10 years since the CCP released its “Made in China 2025” strategy, Chinese companies have leapfrogged the rest of the world’s density of robots per capita. They passed the United States in 2021, then the famously automated economics of Japan and Germany in 2024, and will soon eclipse Singapore and South Korea, their last remaining contenders. In short order China has become the world’s central robotics power. Entirely autonomous “dark factories,” like those of smartphone and automobile manufacturer Xiaomi, operate in complete darkness with no humans present.

China has successfully executed what we once thought impossible. Only ten years ago we scoffed that “China can copy, but they can’t innovate,” which we then revised to, “They can innovate, but they can’t make the upstream high-precision tooling.” Maybe we shouldn’t have been so comfortable, given how Chinese companies had outcompeted the rest of the world in industry after industry – from solar photovoltaics, where competition outside of China has been practically decimated, to 5G, whose global deployment was a massive success for China’s national champion Huawei. The same pattern is playing out now with robotics. China has built a playbook to dominate strategic industries, and has used that playbook to become the robot superpower.

Homegrown Chinese companies now design and fabricate precision parts like harmonic reducers at competitive quality, cheaper prices, and – most importantly – colocated with their customers in manufacturing superclusters. This is the part that should scare the West the most. The colocation of so many robot toolmakers, assemblers, and customers in nodes like Shenzhen or Shanghai is how new combinatorial use cases are discovered, how manufacturing sequences are optimized around that new potential, and how firms develop advanced process knowledge that is completely opaque to the West. In a few years, it will be Chinese companies that are making parts that we cannot replicate – not just at low cost, but at any cost. There are parallels from the past. In the 1970s, Japan shocked the world with Toyota’s lean production methods, just-in-time inventory, and ethic of kaizen, continuous improvement to eliminate waste. Initially dismissed, by the 1980s Japanese automakers had overtaken American and European giants and reshaped the global auto industry. If we do not act to avert it, this will be another Toyota moment, but on a much greater scale.

If we don’t act soon, the United States will find it extremely difficult to catch up: we are approaching a period of compounding improvement that threatens to make China’s advantage virtually insurmountable. As with LLMs, training advanced robotics systems requires pretraining data on the scale of the internet, along with reinforcement learning to train generalist policies that can reason across a wide range of distortions in environment, perception, and task. As data from real-world deployment comes online, the country with more robots gains flywheel momentum; more deployment means more high-quality data which underwrites further deployment. The United States isn’t entirely out of the game, and our lead in AI software carries over: American companies like World Labs are at the forefront of building frontier models that could allow robots to reason about 3D space. But as these capabilities mature, it will be action in the real world – from routing cable harnesses through chassis pathways in electronics assembly to simply doing laundry – that will unlock the economic and strategic promise of generalist robotics.

Micron tolerance

To understand what China has achieved in the past few years, let’s talk about the harmonic reducer – a simple manufactured part that’s deceptively hard to make.

Harmonic reducers are a type of gear system that looks almost like a shoulder or an elbow in its socket. They transfer rotational energy from one end (usually at high speed, from an electric motor) into a much slower gearing, at high torque. They do this by offsetting an inner and outer gear ring that are slightly offset from one another, paired with a rotating oval-shaped piece on the inside. When driven by an electric motor, this creates a waveform that slowly drives the outer socket with a high gear ratio and high torque – suitable for many robotic applications, including humanoid ones.

The challenge in manufacturing these tools comes from how sensitive they are to minute distortions in tooling and operating. They must be made micron-level precise, at low cost, to do their jobs correctly. Even more precision is required when these sockets are chained together into systems with multiple degrees of freedom, like the multiple joints on a robotic finger, hand, or limb. Achieving the strength and dexterity of a human hand, at non-prohibitive cost, requires true manufacturing excellence.

The precision required to manufacture harmonic reducers is well beyond the reach of most machine shops. Production has historically been dominated by highly specialized German and Japanese manufacturers: the Japanese company Sumitomo and the German-Japanese firm Harmonic Drive are the two dominant players in the space, together accounting for 95 percent of global market share. But in the last few years they’ve faced intensifying competition from new entrants from China. A firm called Green Harmonic, based in the city of Suzhou near Shanghai, offers harmonic reducers with performance comparable to products from Sumitomo and Harmonic Drive, but at roughly 30 to 50 percent cheaper price points. Green Harmonic now has more than 30 percent market share within China; and will soon look abroad. In the coming years, we can expect companies like Harmonic Drive to face their “Toyota moment,” with major strategic implications: there are countless cases of Chinese firms translating cheap, reliable manufacturing into global market share and eventually driving competitors out of business.

Harmonic reducers are just one illustrative part of the robotics hardware stack. Creating a fully functioning robot requires a huge variety of other small components – precision bearings that enable smooth joint rotation, custom printed circuit boards that route power and signals between subsystems, specialized connectors that maintain reliable communication in high-vibration environments, miniature encoders that provide millimeter-accurate position feedback, force-sensitive resistors embedded in fingertips for delicate manipulation, inertial measurement units that track orientation changes down to fractions of a degree, servo motors with sophisticated current control algorithms, shielding to prevent electromagnetic interference between tightly packed electronics, thermal interface materials that dissipate heat from high-performance processors, and countless fasteners, gaskets, and protective housings engineered to withstand the mechanical stresses of real-world operation. Each component must be carefully selected not just for its individual performance characteristics, but for how it integrates with the broader system: a single point of failure can render a sophisticated robot completely inoperable.

Chinese companies, from Siasun and Estun in controllers to AVIC Electromechanical in torque sensors, are rapidly entering and starting to win the market for every part of that system. Together, these firms and countless others constitute a sophisticated and mature ecosystem that has allowed Chinese firms to locally source practically the entire robot – not only from within China, but within a megacluster like Shenzhen.

We’re at the point today where Chinese domestic manufacturers and their suppliers contribute all of the parts necessary to bring robotic dreams to life, and iteratively learn from one another. The Chinese startup Unitree has captured the global imagination with highly advanced robots cheaper than anything else offered before – agile and LLM-integrated robot dogs for as little as $1,600, a humanoid for $5,900. Those costs will keep coming down; the robot dogs will keep getting stronger and more capable.

by Martin Casado and Anne Neuberger, A16Z |  Read more:
Image: uncredited

[ed. This is from Andreessen Horowitz, so little surprise they would view government subsidies (too little) and over regulation (too much) as major contributing factors. But politics, policy, and a lack of strategic planning and funding priorities are probably the more important constraints. I mean, we currently have a president and congress that give lip-service to reshoring American manufacturing, but have no idea what industries are most important, or even how infrastructure improvements and corporate incentives (and disincentives) could help. All the while re-directing trillions of dollars into the military, homeland security and immigration enforcement. No wonder China is pulling away on all fronts. They actually have a clear idea of where they want to go.]

There's Just Too Many Damn Elites

In a recent piece on James Burnham we discussed the rise of managerialism, or the idea that society is dominated neither by capitalists/owners or workers/proletariat.

Instead they are run by a middle layer of managers who have entirely different incentives from the owners or the shareholders. (...)

While Burnham introduced the concept of managerialism, Barbara Ehrenreich coined the term “Professional Managerial Class” in her similarly-titled 1977 essay. Since her piece, the PMC has only grown in power: eating up most of the money in our society while acting rebellious and aggrieved while doing it.

Marc Andreessen called the PMC the ‘laptop class’:

Laptop Class (noun): Western upper-middle-class professionals who work through a screen and are totally abstracted from tangible physical reality and the real-world consequences of their opinions and beliefs.

The professional–managerial class tends to have incomes above the average for their country, with major exceptions being academia and print journalism." [Who are compensated with power instead.]

The PMC exists somewhere between what we think of as the traditional working class and the ruling class. While they aren’t capitalists and don't own the means of production, they do play a big role in upholding and extending capitalism’s reign.

In other words, managers are a specific type of employee that are materially on the side of labor—but symbolically on the side of capital.

What Ehrenreich noted was a bifurcation: On the higher end more commercial PMCs were peeling off to join the elite tier of wealthy CEOs and managers, while on the lower end the PMCs were suffering from a collapse of many of their preexisting professions (e.g. academics, journalists, etc).

And so the academics and journalists had to make a choice: they could either join the traditional working class to fight against the capitalists or they could join the capitalists against the working class in the hope of getting rich in the process.

Post 2008, we saw the PMC join the working class to fight the capitalists in the Occupy Wall Street Movement. The majority of Occupy’s participants were college grads who had experienced massive student debt, unemployment, and downward mobility during the economic downturn. The language of “We are the 99%” reflected the fact that the movement’s participants saw themselves as part of the exploited masses.

But the Occupy movement quickly came and went. Corporations obviously didn’t support it because unlike more recent social movements, Occupy required real sacrifice on the part of the corporation. Bernie Sanders ended up losing to Hillary and that was that.

In an attempt to create these new social conflicts (anti-racism, anti-fascism, the gender wars), the PMC altogether ignored and suppressed class wars. When Nike says they’re committed to fighting anti-racism or anti-semitism, it buys them social capital that allows them to deflect against inquiries into how they treat their workers.

Over the next decade that PMC would eventually switch from working class to social justice rhetoric. After all, Wall Street couldn’t support Occupy Wall Street or broader unionization efforts while remaining in business, but they could fund activist efforts with billions of dollars while signaling to the type of elites they’d like to hire and do business with.

To further distinguish the PMC from the working class, colleges initiated the PMC into this esoteric language which made non-college goers feel left out and left behind. A great deal of what constitutes activism is an elaborate set of rules about what you can and can’t say about this or that group. The complexity of the rules is itself strategic — it’s a way of doling out power to the college grads who learned all the rules while taking away power from the non-elites who didn’t.

Activism became not just a social philosophy, but an elite status marker. As David Brooks once put it, “You have to possess copious amounts of cultural capital to feel comfortable using words like intersectionality, heteronormativity, cisgender, problematize, triggering, and Latinx”. More specifically, you have to go to college to learn those words, which excludes two-thirds of the country.

Activism also became a strategy for professional advancement beyond college. By calling out the privilege and moral failings of those above them in the corporate pecking order, young elites became able to intimidate Boomer administrators and usurp power from them.

This isn’t all just ideological posturing, it’s also a practical necessity. The truth is that we have too many college educated people without technical skills who expect high-status and high-paying jobs and there simply aren’t enough jobs for them.

by Erik Torenberg |  Read more:

Image: uncredited

Subscription Prices Gone Wild

Most platform subscription price are going up, not down—and many are skyrocketing.

Music streaming is one more example. Spotify’s Chief Business Officer recently offered the bland observation that price hikes are “part of our toolbox now”—and added “we’ll do it when it makes sense.”

What does that really mean?

According to a recent report from Goldman Sachs, Spotify subscribers should expect regular prices increases from Spotify in the future—with a boost coming every 12-24 months.

Spotify even bragged to the investment community that it’s always planning a price boost somewhere. Here again is the Chief Business Officer laying it out for us:

I want to also remind you that we take a portfolio approach. So in a sense, you could say that we raise all the time. For instance, in the last quarter we raised in France, Belgium, the Netherlands, and Luxembourg. And I can report to you that on churn, we didn’t see anything out of the ordinary for Spotify.

Years ago, I claimed that streaming economics were broken, and price increases were inevitable. But I never anticipated the rapacious response of the suits in the C-suite.

The short explanation is that they do it because they can. Sure, some people cancel their subscriptions, but not enough to make a difference. Most subscribers simply put up with it.

That’s why the streamers keep boosting prices again and again. They will continue doing it until they encounter serious resistance—and they haven’t hit it yet. So I expect more of the same.

But there’s a danger to this business strategy. Look at Las Vegas, where tourism is collapsing because the casinos went too far. For a long time, the public didn’t flinch in the face of price hikes, but then it got ridiculous:

• $95 ATM fees

• $14 coffee

• $50 early check-in fees

• $30 cocktails

The casinos have now earned a reputation as exploitative price-gougers. Tourism is now down sharply—hotel occupancy has dropped 15%. The city feels “eerily empty.”

This isn’t easy to fix. Once you destroy your reputation and lose the customer’s trust, it’s almost impossible to get it back. That happened in an earlier day to Sears and K-Mart, and they never recovered.

Something similar may already be happening at Disney’s theme parks. Some visitors report that Disney World is empty—looking like a ghost town even during Labor Day weekend.

by Ted Gioia, Honest Broker |  Read more:

Image: Daniel Parris, Stat Significant

[ed. May have to go back to cable (horrors). Just canceled my Amazon Prime account. See also: Is TV's Golden Age (Officially) Over? A Statistical Analysis.]

Uh Oh, US Farmers Totally Screwed

And that is bad news for The Groceries.

For fucking around with the world of Trump, some groups of people are reaching the find out phase faster and harder than others. And one of those groups is among the most loyal to the regime, farmers. While farm income is technically up, it’s only because of $42 billion in socialist bailout money in the form of a 720 percent increase in ad hoc disaster payments, that so far have made up more than 23 percent of Net Farm Income in 2025. But without that, farm income is down nearly 6 percent from December. And economists with the University of Illinois report that agricultural exports dropped by nearly $5 billion in just July alone.

The reason why is no mystery! Those Trump tariffs screwed over farmers coming and going, with higher input costs for supplies like seeds, fertilizer, and tractors, and lower selling prices for commodities. So far this year, China has not purchased one single, solitary soybean, opting to shop for them in friendlier Brazil, instead.

And US soybean farmers are projected to lose roughly $100 an acre this year. Nor are Mexican or Canadian companies as interested in buying the US’s corn or rice, now that retaliatory tariffs have made them more expensive. So farmers who took out loans or dipped into capital reserves expecting to sell their crops are facing the threat of bankruptcy, and in Q1 of 2025 the number of farm bankruptcies was nearly double the level of the first quarter of 2024.

Of course Trump knew full well this was going to happen, because it happened in his first term too: He levied tariffs, farm bankruptcies reached the highest level in a decade, and he ended up giving farmers a $16 billion bailout. And now Agriculture Secretary Brooke Rollins says even more bailout money might be coming.

It would be simple to help out farmers without giving them any socialist bailout money. Quit tariffing fertilizer, for one thing! Even Chuck Grassley has noticed this.

There’s a guy who definitely writes his own posts, who surely does watch a lot of corn. In an interview with RFD-TV, he vented more:

“We’ve got this farm crisis now, and this President should deal with this farm crisis right now. I’m hearing from bankers. I’m hearing from people that are getting pressed by their bankers to maybe sell part of their farm to somebody, [so] that when they build up their equity, they might be able to buy it back. We haven’t had this kind of stress in agriculture since the 1980s.”

Another big-brain idea, quit tariffing tractors! Or even just make ONE tariff rate and stick to it. The tariffs aren’t only expensive, they’re bizarrely complicated, and of course, prone to shifting with the tides of Dear Leader’s ever-changing moods.
From the WSJ:

The effective tariff facing exporters now varies depending on a product’s metal content. For a machine worth $1 million with a 20% steel content, the rate would be 50% of $200,000 and 15% of the rest, resulting in a $220,000 levy per machine—or a 22% tariff. The U.S. has said it would review the metals tariff list every four months, adding to the uncertainty.

Or as Grassley put it:

“Putting 50% tariffs on things that have steel in them, when you can’t buy those things in the United States, and you need them for your tractor to be finally manufactured? There should be tariffs on things that you can’t get in the United States. Why drive up the price of John Deeres because of a tariff on something they need for the tractor that they can’t even get in the United States? It’s a stupid policy.”

Indeed, if the point of these tariffs is to start making more tractors in the US, why put kooky tariffs on the metal that tractors are made out of? If we were cynical, it might seem like a ploy to make farmland real cheap so big agribusiness can buy it all up.

And the shortage of farmworkers is another self-made Trump problem. When the regime isn’t humiliatingly rounding up and detaining people with and without proper work visas, it’s also allowing the ones who do have H-2A visas to work in conditions one federal judge called “a form of modern-day slavery,” where they’re frequently abused, get their wages stolen, and are threatened with a call to ICE if they complain. (...)

And then there’s how USAID is no more, and not buying farmers’ extra grain any more. Cruel as they are stupid, ayup.

Are Republicans starting to smell the disaster Trump is brewing? Polling shows more Republicans than Democrats are worried about the economy, and Trump’s approval rating on the top issue dumbshit voters picked him to fix, The Groceries, has been going down to poundtown. And his approval rating is underwater in most states, including the breadbasket ones. Even in Arkansas, it’s plunged to single digits.

Anyway, it’s tempting to laugh at the poor dumb rural folk who thought that Donald Trump, the man who went broke on casinos, was going to be their savior. He bailed them out before, so guess they just expect that he and Congress will keep on doing it.

But we all have to eat, and bad news for The Groceries is bad news for everybody. But good news, soyboys, maybe at least domestic soybeans will be real cheap.

by Marci Jones, Wonkette |  Read more:

Image: Tomasz Filipek on Unsplash
[ed. For a clear explanation of why so many farmers supported Trump (knowing full well the downsides). See this: