Ford, Imitative AI and the Failure of Capitalism

ChatGPT 5.0 was released a couple of days ago and it is bordering on being a flop. People are complaining about the loss of previous models and it still has, inevitably the same kind of lies and mistakes that are endemic to all imitative AI systems. Altman promised a PhD in your pocket, and delivered a PhD that cannot draw maps or spell blueberry. It is a sign, I think, of the failures of capitalism.

Climate change is real, and it is harming real people every day. It has the potential to radically reduce the number of people on the planet, livable areas on the planet, and the quality of life for people on the planet. The solutions are not hard, even if they are not entirely complete. For example, a Chinese firm, with the complete backing of their government, has produced inexpensive, fast charging electric cars that are generally considered superior to Teslas. Ford has seen this and now has a plan to produce comparable cars — reimagining its entire EV production process to build better, cheaper cars and trucks.

This work is social beneficial and financially important to the company (even if the US lags behind in climate change regulations, the rest of the world’s major markets do not. If you want to be a car manufacturer of any size, you need to play in the EV space). Compare to imitative AI — limited social functionality, no clear path to profitability, and damaging to the environment. And yet, imitative AI is the tech that governments are pressing, and investors are throwing money at. Why?

Part of this partly driven by the fact that we are driven by the kind of people who hate workers. Imitative AI promises to be able to fire massive amounts of people and to allow firms to be run by a few underpaid people editing the work of the systems. Now, none of that is true, mind you, but for a certain kind of person, it is an attractive proposition. I think, however, that this is mostly an indicator of how capitalism has failed.

Investors no longer value long term profitability. They judge firms on the social media scale: a firm must be able to pay of a thousand times or more its investment or it is to be sold for scrap. Only growth matters, because only supersized growth can create the kinds of payoffs they need to justify the amount of money they throw at immature and even ridiculous firms. The problem, of course, is that there are not always virgin markets to grow exponentially into. Ed Zitron calls this the rot economy, and that is a pretty good description. The push for crypto, NFTs, the Metaverse (remember that?) all stem from the inability to just build businesses in mature markets. Modern investor capitalism doesn’t work under those conditions, so they are desperate to recreate the hyper growth and new markets of the early internet era. Their problem, and ours, is that such markets likely no longer exist.

Ford is doing what a well-run company should do — investing in the future and doing so in a way that respects all its stakeholders, not just the shareholders. Imitative AI, on the other hand, has declared war on any one not an investor and is flailing around looking for any exit ramp before the bubble bursts. It is telling that Ford is not the darling of Wall Street and governments and imitative is.