AI's biggest critic has lost the plot
theargumentmag.com
Related: AI's Economics Don't Make Sense - https://news.ycombinator.com/item?id=47936867
theargumentmag.com
Yeah, I find that sort of critics to cause more harm than good. The economic case for closed source AI isn't there - in macroeconomic sense, and accounting for all costs, it's more expensive than the value it provides. There's data to back that up, so focus on economics.
On the other hand, hallucinating about what AI can or cannot do is useless, only research can provide the answer.
But saying “I wish the argument was being made better” while using him as the basis for your article is more annoying to me! Just make the argument then.
But publications like The Argument need to take shots to get views, I guess.
Perhaps a slower, more nuanced scroll would serve you. (In all respect.)
I think The Argument / Piper know that an “Ed Zitron is wrong” angle drives more traffic than just writing better AI criticism.
Secondly, I don’t think she kicks the tires that well. “AI skeptics underestimate its utility” is a tweet-length observation. (Derek Davidson, another Argument contributor, has made such a Tweet. I think it would be much better if she tried to steelman or engage Zitron a bit on the econ ramifications of the current bubble.
When I say Zitron is annoying, it’s because he’s very strident and can make arguments that don’t make sense or are easy to refute. But that’s also the most boring way to engage with him!
Yeah but that's the whole point. If LLMs need to keep getting better before they can turn a profit they need to keep scaling. If they need to keep scaling then the LLM companies need to keep spending more to scale them. If they need to keep spending more then they need to be making more money.
Are they? If they're not, then they're toast.
Btw, this is true even if training gets cheaper over time. Cheaper training means more training not less money. Jevon's Paradox and all that.
I'm not a big user of AI for lack of interest, but have held for several years that I'd be more interested if it were faster and cheaper. If this form of AI is the future, I do hope it gets significantly more efficient, even if the capability caps out. I think there is plenty of room for interesting applications, if so.
> he does not consider, even to disagree with it, the possibility that the industry is paying for Anthropic’s product for non-psychosis reasons, such as finding it useful)
> “Nobody wants to talk about the fact that AI isn’t actually doing very much,” he complained, before going on to complain about people saying that agents are able to do tasks independently with oversight. “What tasks, exactly? Who knows!” he wrote.
>
> Ed, thousands of people know and it is your journalistic responsibility to be one of them!
There were many people around me that said that in the 80s.
It's limited, if it were any good, then the prevailing industry would suppress it. (Video Recorders) to be fair industries did try to suppress it.
There's literally centuries of doing things the old way. It doesn't matter if it's faster if half of your implements can't even be used with it. (Microwave ovens)
The same measuring a new paradigm by the goals of an earlier paradigm, over and over. Encountered with computers, mobile phones, the web, wikipedia, Streaming video.
It's all just "That thing can't fly, it doesn't have feathers" shifted to a new domain.
Which seems to be a lot of this article
Motte: AI is useless and unsustainable and fraud and the bubble will pop anytime
Bailey: Ohh ackchually AI is a bubble but it will end up like the internet
Why bother with useless arguments like this?
this whole article was "i wish he made arguments the way i like"... ok then go do that yourself? its word policing at its most annoying
My own feeling is that it is a bubble: AI models are the new virtual machines. They will become commodified and low-margin hosting providers will dominate the market. Investors in OpenAI/Anthropic will lose their shirts.
I have my doubts about this. We have not seen a viable YouTube alternative because the underlying costs of handling video content are significant and YT has custom hardware and sophisticated software. When we look to the broader cloud market, hyperscalers dominate. We are likely seeing similar when it comes to Google's TPU and access to Nvidia's best offerings.
That being said, I did just pick up a DGX Spark and it runs qwen-3.6 sufficiently well to be a viable interactive coding assistant. Certainly more than enough for unattended agents.
TikTok kinda did manage to make a dent though - I suspect it substitutes for YouTube in some cases (though not all).
Those same network effects dont exist (yet) on models
Ads might be questionable model for lot of use cases. And network model only works for promotion but does not lock users in because content is only available in one place.
It is unlikely that models will have network effect because (1) there is less of a two-sided marketplace and (2) people are already forming brand preferences. We also see significant convergence among the agent harnesses as well.
I'm currently building out an internal agentic orchestration platform for business and development and a requirement is to support multiple models and tools so people have an amount of choice.
the content and creators are the only competitive advantage they have. there are MANY video hosting platforms out there but they just don't have the content to attract large audiences like youtube does. they have a strong early mover advantage
Deepseek v4 flash is priced at 1/10 that of openai/anthropic. I can see a race to the bottom - or perhaps an android vs iphone split - where, the premium market is served by openai/anthropic and there is a long-tail of commodity vendors.
Who will pay 500x the price for a 1% better model? Quants and traders?
You might prefer your KitchenAid toaster but I'd wager you won't pay enough to support a trillion dollar valuation.
Even more interesting is the question if we would have a deepseek model without the US frontier models.
And then what's the value of the advantage that the frontier models have. It's definitely 100x more valuable to find zero days 3months earlier. Probably not in every domain but in enough domains having the smartest model is valuable.
- If AI costs are going down: oh no it’s getting commoditised, OpenAI bankrupt anytime soon TM
- If companies have moat and get bigger: oh no companies are getting powerful! It’s bad and we must oppose them because they can rug pull anytime and enshittify!!
What situation is something that you would be okay with? Because people seem to have a problem with any outcome.
I'm actually pretty happy if we have a competitive market for AI that maximizes consumer surplus. For a while there it looked like AI might remain in the hands of two or three corporate giants.
(I won't be buying the OpenAI IPO, that's all)
> Over the last two years, he has called the top repeatedly: The AI bubble was definitely about to burst here, and here, and here, and here, and here, and here. His conclusion hasn’t changed, but his arguments have.
> The 2024 and 2025 articles make, basically, the business case against AI: that companies aren’t really using it, it isn’t adding value, and AI investors are betting that will change before they run out of cash. In 2026, the focus is much more on alleging widespread, Enron- or FTX-tier outright fraud.
> This is basically an admission that he can’t make the case in terms of the economics anymore. And in deciding how seriously to take his case in 2026, I think it’s valuable to read it in parallel with his case from 2024 and 2025.
Say what? This is exactly the progression that you'd expect if there was, in fact, outright fraud going on.
* Someone claims to be able to do <impossible thing>
* Critic call them on it
* Rather than folding, the hype machine grows and they start claiming to be doing the thing
* The critics start accusing them of fraud
Also, I note, it's a cute trick to start of claiming "time passes and situations evolve. Ed Zitron, though, clearly does not" and then in the next paragraph object that "his conclusion hasn’t changed, but his arguments have".
I don't have a pony in this race and don't know who Ed Zitron is, but this article makes me suspect he's correct. Acting as if going from "they are wrong" to "they are wrong and lying" is "losing the plot" is anti-convincing.
[edit]
The ending is much stronger:
> I don’t actually think we need less skepticism in AI world. These companies are, indeed, run by people who are not very trustworthy, who often contradict each other or oversell their products.
> And the things they say they’re trying to do are outrageous; people have every right to object to it. Skepticism is more than warranted.
> But we desperately need better skepticism.
In that spirit, I would like to offer this observation. The one substantive difference the author highlights is the claim that generative AI is now offering value that renders the claims that it's all fraud questionable. I would argue that the value it offers is effectively plagiarism-as-a-service, and, just as with the infinite energy machines that secretly harvest power from the wiring of the building, compatible with the notion of fraud.
When I search for such things I tend to only find claims that claims were made.
The critic initially argued that there's no way to make money the way they were going, and then has subsequently concluded that any reports that they are making money are therefore fraudulent.
But I think it boils down to a form of.
Claim: There can never be an X
Response: This here Y is an X
Claim: No it isn't!
I was asking for examples of Y so we could judge for ourselves.
I do not have an example to offer.