A challenge of being part of the establishment in a dying empire is the need to ignore and explain away obvious signs of imperial decline and demonise rival empires. Inevitably, the shock delivered to purported American AI supremacy by Chinese start-up DeepSeek — which even Trump supporters hailed as a “Sputnik moment” — has had local vassals of the US in damage control.
National security consultants Strategic Analysis Australia (which advocates for a colossal increase in defence spending to fight China) demanded DeepSeek be banned in Australia. Discredited former public servant and anti-China hysteric Mike Pezzullo warned it “could give the People’s Liberation Army a significant combat edge, just as geopolitical tensions will see the probability of confrontation and even conflict rise over the next four to five years”. The Coalition’s chief China hawk James Paterson (Peter Dutton having, for electoral reasons, abandoned his Sinophobia) called for the government to “closely coordinate a response with our closest allies”.
All warn about the risk of information sharing (which is pretty funny for Pezzullo, given he lost his job for leaking sensitive government information), which raises an interesting question. With whom would you rather share information: companies run by people in thrall to and supporting a self-obsessed leader with imperialist ambitions who rejects the rule of law, targets enemies and demonises his opponents as enemies of the people, or with Chinese companies? Is your information safer with Mark Zuckerberg (Cambridge Analytica, anyone?), Reichsleiter Musk, and Trump donor and doomsday prepper Sam Altman?
Xi Jinping and the Chinese Communist Party may be brutal tyrants with contempt for the value of human life and the rule of law, not to mention a penchant for bullying China’s neighbours, but they’re a relatively stable global force with far smaller military spending than the US, and no track record of wantonly invading other countries like the Americans. (Where’s next? Greenland or Panama?) And despite the Sinophobic hysterics, Australians don’t seem to have a problem with using Chinese tech products — shares of BYD electric vehicles surged in Australia last year even as Tesla sales (driven by Elon Musk demonstrating what a dickhead he is) fell. Musk also makes large numbers of Teslas in China, doubtless to the chagrin of MAGAlanders.
Clearly the hysterics worry that Australians are prepared to buy Chinese tech products based on price and quality and aren’t turned off by their warnings of national security dangers and imminent war.
More worrying for the hysterics are the messages that the DeepSeek story has for the rest of the world. The trivial message is that American AI companies have no hope of launching their products in China. DeepSeek and its inevitable imitators will dominate that market from now on. More important is that America’s efforts — bipartisan in nature — to contain China on tech now look doomed to fail.
As we noted yesterday, China already dominates EVs — BYD is the biggest producer of electric vehicles in the world and there are a number of other Chinese manufacturers producing high-quality EVs as well — and solar photovoltaic, as well as being the leader in lithium-ion battery production. Its TikTok platform has proven so popular that Western governments have fallen back on banning it. Similar dominance in AI might prove beyond it, but can’t be ruled out if the likes of OpenAI can’t match the achievements of DeepSeek.
DeepSeek demonstrates to other major economies, like India, that US tech dominance is not guaranteed, and that it’s possible to develop a cheap, home-produced product, free of much of American tech influence (which under Trump means political and cultural pressures).
Above all, if any of the hype about AI is justified (and much of it will turn out to be misplaced — remember the hype about 3D printing?), one of the key impediments to its universal uptake — its cost and the massive call on natural resources it requires — has been massively reduced. And that’s good for everyone in a world in transition between two empires.
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