Home » “Europe’s role in AI is pathetic. Thus it will become a colony of the USA and China.” Interview with Alec Ross

“Europe’s role in AI is pathetic. Thus it will become a colony of the USA and China.” Interview with Alec Ross

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“Europe’s role in AI is pathetic. Thus it will become a colony of the USA and China.”  Interview with Alec Ross

Alec Ross is among the world‘s leading experts on the digital economy. Born in West Virginia in 1971, he was an advisor to Hillary Clinton at the State Department for Innovation and coordinated technological policy for Barack Obama’s election campaign. He is the author of world bestsellers (his The industries of the future is among the New York Times bestsellers). Today he lives in Italy, where he teaches at the Bologna Business School.

Professor Ross, Nvidia’s valuation has become a fluke. With her, all the technology companies listed on Wall Street are advancing, capable of bringing the indices to new record levels. Is this rush to invest in Ai justified?

“Current research estimates a baseline case where widespread adoption of AI could contribute 1.5% to annual productivity growth over a ten-year period, boosting global GDP by nearly $7 trillion. positive case results in a notable total increase of 2.9%. This alone validates the investment. Add to this the role that AI can play in addressing global challenges such as climate change and extending the longevity of life human through the application of artificial intelligence in genomics, the investor class (at least in the United States and China) absolutely believes so.”

Couldn’t such an impetuous race hide some fragilities? Technologists have accustomed us to impressive growth and dizzying collapses.

“Markets go up and down, but over the long term they go up. The real risk is thinking primarily in terms of risk and not in terms of opportunity. Money that sleeps in bank accounts and is not invested more kinetically is underperforming. high savings rate and lack of investment have contributed significantly to the lack of economic growth in Italy over the last 20 years.”

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Nvidia has quadrupled its value in a year. What does this case teach us?

“Nvidia is the fastest growing stock in the stock market, but it still statistically represents a smaller share of the total size of the US markets than other companies, including Apple, Microsoft, Meta and Amazon, all of which are performing well. Nvidia is just the most recent and exciting addition to this category of Big Tech, so it’s getting all the attention, attention that’s probably deserved. The real lesson from Nvidia is that the US continues to produce globally dominant tech companies. Very few they knew Nvidia 5 years ago. This kind of dynamism should be celebrated.”

Today 9 of the 10 most capitalized companies in the world are technology companies. The digital market seems unable to avoid creating giants and monopolies.

“Market concentration and the power of a limited number of global businesses present a number of challenges. But these are challenges that have potential solutions. This starts with ensuring that these global conglomerates – most of them are not really monopolies but conglomerates) pay taxes and do not engage in strategies that allow them to relocate their earnings. Small and medium-sized businesses pay a higher percentage of their profits in taxes than companies like Google, Apple and Meta because small and medium-sized businesses do not have neither the global presence nor the armies of lawyers and accountants to facilitate these transactions. Before we talk about breaking up or limiting the size of these large companies, I would like to see them pay their fair share of taxes and not be allowed to hide in tax havens.” .

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Is there real competition between the US and China on AI?

“It’s a real competition but at this point the United States is first because it invests more: this year the United States invests 65 billion while China invests 35. Secondly, because the United States is much further ahead in the field of Generatives. The Chinese don’t like Large Language Models (LLMs) like ChatGPT because they are very difficult to censor and control and the Chinese government will restrict anything it can’t censor or control.”

Europe at the moment seems more determined to regulate AI than to develop it.

“I honestly find it pathetic and embarrassing.”

Are you saying that there is no need to regulate AI?

“Of course, there should be reasonable regulations on AI, but unless Europe wants to be an economic colony of the United States and China, then we will need fewer lawyers, politicians, philosophers and bureaucrats establishing strategies and rules for the Ai and more entrepreneurs, venture capitalists and engineers. For too long, Europeans have no longer been protagonists. It’s like a football match. There are two teams on the field, one American and one Chinese. Instead of deploying their own, the Europeans preferred to play the role of the referee, who calls fouls and shows the yellow card. The referee can help decide the outcome of the match, especially if he directs badly, but he is never the one who wins it. If they want to win, the Europeans must send their team out on the pitch.”

How should Europe play?

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“Just look at the competitive models of technological development in China, where an authoritarian government has developed a model of total surveillance and, in exchange for control and political power, promises stability. The other team is led by the ‘kid’ entrepreneurs of California, who have developed a surveillance model entirely in the hands of the private sector. These new companies create products that are highly addictive. I am addicted to them too. Instead of giving them political power, we give up financial power, which allows these tycoons to become a global super elite, with levels of wealth, and even power, that would have been completely unthinkable a few decades ago. Neither Chinese authoritarianism nor Californian billionaires are the right path for Europe. We need a European team and Italian that carries forward its own model of social contract and economic growth that guarantees the balance between companies, government and citizens”.

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