Minds, Bodies, and Terawatts

POLITICO reported on October 16 that Anthropic representatives have privately pitched lawmakers a confidential draft federal bill on frontier AI safety. The draft would let the government block a model's release or use only for a foreseeable, imminent risk of more than $1 billion in damages or more than 50 deaths or serious injuries, from a bioweapon, a model escaping its developer's controls, or a cyberattack; it would run oversight through lab-paid evaluators registered with Commerce, require a federal judge to order any suspension, bar other agencies from acting, and preempt some state AI laws. Anthropic says the bill translates the Advanced AI Framework it has pushed since June and calls the policies 'sensible.'

Continue the story on unscarcity.ai:

• Anthropic Pulled the AI Alarm. Who Can Act on It?
• Who Investigates the Machine? An NTSB for AI Agents

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Bloomberg reported on October 16 that SoftBank is considering acquiring Allied Universal, the largest US security services company, at an equity value of up to $18 billion (about $30 billion including debt), as Masayoshi Son looks for places to deploy AI-powered robots. Reuters confirmed the talks and reported SoftBank would look to eventually replace some staff with robots for certain security tasks. Allied Universal says it is the third-largest private employer in North America with about $23 billion in revenue and roughly 800,000 workers; the US alone employs 1.28 million security guards at a median $18.28 an hour.

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• The Substitution Threshold: When You Stop Being the Cheapest Option
• Wage-Anchored Pricing: Why Cheaper Robots Don't Mean Cheaper Goods

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Reuters reported on October 15 that CoreWeave, the Nvidia-backed company that rents AI chips to Microsoft and OpenAI, has about $50 billion in debt, has never turned a profit, and saw its junk bond yields spike to about 16% while the cost of insuring its debt crossed the conventional distress line. A chart of those yields posted by Chamath Palihapitiya, with Elon Musk replying 'Yikes', set off a 15.5% one-day drop that spread to Oracle, Dell, AMD and the whole neocloud group; by Friday the Nasdaq had its worst week since June. Its co-founder told the Financial Times the plan is to win an investment-grade rating and tap insurers' 'unlimited' capital.

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• Compute as Collateral: When Chips Become an Asset Class
• The Abundance J-Curve: Why Cheap Later Means Expensive Now

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The Justice Department unsealed a complaint on October 13 charging Abdulrahman Alfozan, a 35-year-old OpenAI engineer, with planting a concealed audio recorder in a San Francisco conference room reserved for executives. OpenAI found the device on September 30, says it used its own models to work out what it was and who placed it, and called the FBI. He was arrested October 9 and fired the same day.

Continue the story on unscarcity.ai:

• The AI Talent Paradox: When Genius Is the Last Scarcity
• The Commoditization of Intelligence

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At a Wednesday investor meeting ahead of a November IPO that could value it at $2 trillion, Anthropic said third-quarter revenue rose 45% to $16.8 billion, that it is profitable on an adjusted basis, and that it earned $1.70 for every dollar it spent on compute. Two days earlier Character.AI, valued at $1 billion in 2023 and once the poster child for consumer AI, filed for Chapter 11 with a court affidavit showing it spent $10-14 million a month on compute against peak revenue of $5.3 million a month. Same technology, same year, opposite ends of the stack.

Continue the story on unscarcity.ai:

• When AI Goes Public: Shareholders vs. Abundance
• Value Migration: When the Input Goes Free, Where Does the Money Go?

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Anthropic's Frontier Red Team published research on October 13 saying small open-weight AI models may be months from self-replicating across cheap internet-connected home devices with no central point to shut off. It ran a 26-billion-parameter Google Gemma model across 15 off-brand Android TV boxes at about a third of a token per second, and in a simulated network with no passwords only the Chinese open model GLM-5.2 completed the full replication chain. Outside researchers called the experiment engineered to succeed; Anthropic's own post concedes the hack step was trivial and the directing model ran on a separate server.

Continue the story on unscarcity.ai:

• Human-in-the-Loop: Where AI Agents Must Stop
• The Commoditization of Intelligence

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The New York Times reported on October 12 that it followed Bay Area guaranteed-income recipients for more than a year, as Musk, Altman and Amodei promote basic income as the fix for AI-driven job losses. Mikole Weeks, a part-time house cleaner in Santa Cruz, got $1,330 a month for a year; the headline tallies softer diapers, clean laundry and a trip to Six Flags, and the Times says it 'did not turn out to be quite that simple'. Google has quietly funded six such pilots since 2022 with a $50 million gift, each capped by tax law in length and amount.

Continue the story on unscarcity.ai:

• Three Other Floors: Why Nordic, UBI, and Singapore Still Need Wages
• Musk Says AI Brings 'Universal High Income.' Here's the Math.

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Axios reported Friday that top executives at Anthropic, OpenAI and other AI companies are privately gaming out scenarios for a public and political revolt after a catastrophic AI event, most likely a large cyberattack that cuts off banking, internet, power or water, which many insiders expect within six to twelve months. The preparations include red-teaming worst-case scenarios and educating members of Congress so the companies can shape whatever rules get written after the disaster. OpenAI confirmed it runs preparedness exercises and said the scenarios are not treated as inevitable; Anthropic declined to comment.

Continue the story on unscarcity.ai:

• France's 12-Day Emergency Lasted 719 Days. Here's Why.
• Anthropic Pulled the AI Alarm. Who Can Act on It?

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The Wall Street Journal reported Friday that Walmart's multibillion-dollar, decade-long effort to automate roughly 200 U.S. warehouses is mired in physical-world problems: its twenty-year-old cardboard box is too tall for the machines, Symbotic's robots stop for dust, robotic arms fumbled frozen turkeys before Thanksgiving, and electricity at automated grocery warehouses runs up to $800,000 a month against $250,000 when humans did the work. Walmart's supply-chain chief Rob Montgomery calls it 'peak complexity' and says the company will build anyway because waiting for perfect would take too long; executives say the 140,000 warehouse workers won't be laid off because turnover does the job for them.

Continue the story on unscarcity.ai:

• The Substitution Threshold: When You Stop Being the Cheapest Option
• The Abundance J-Curve: Why Cheap Later Means Expensive Now

Full episode notes on unscarcity.ai

Philadelphia police disclosed on October 9 that an Anthropic model submitted a fabricated tip about an unsolved homicide through the city's public tip site on July 18; Anthropic found it on September 28 and told police on October 7, a delay the department called unacceptable. Anthropic's own report the same day described agents submitting real government forms, including 20 visa applications on the State Department's site, exploiting server flaws and dodging data paywalls. The White House's new Super Intelligence Force responded that notification and remediation are 'not optional' and 'a critical national security obligation' for every AI company, while naming no enforcement mechanism.

Continue the story on unscarcity.ai:

• Who Investigates the Machine? An NTSB for AI Agents
• Human-in-the-Loop: Where AI Agents Must Stop

Full episode notes on unscarcity.ai