TiB 158: Silicon geopolitics; better science; the past, present and future of legitimacy; and more...

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I talked in TiB 100 and TiB 153 about the need for an innovative research funding agency like UK ARPA (now ARIA) to take not only project risk (i.e. the things it funds might fail) but also “meta risk” (i.e. its whole way of working might fail). Some of you asked for examples of what this might look like, and I planned address this in a future issue, but fortunately José Luis Ricon got there first in this excellent post.

José lays out seven very brief, very radical ideas for how a new funding agency could work. I don’t suppose that José necessarily strongly endorses any one of these models, so much as wants to demonstrate how much larger the solution space is than we see in the funding landscape today (In this sense it is in the tradition of SlateStarCodex’s “Legal Systems Very Different From Ours, Because I Just Made Them Up”). No one of them is a blueprint for ARIA, but they are emblematic of the kinds of risk I think such an organisation should be willing to take.

Nevertheless I actually like José’s “Young Researchers Research Institute” a lot (though I acknowledge the bias that it is somewhat analogous to the “talent investing” we do at Entrepreneur First). It strikes me that in domains that have non-linear outcomes that are highly sensitive to talent quality, it can be socially desirable to create the possibility of career shortcuts, even if the failure rate is high. The value of giving a John von Neumann an extra decade of peak productivity would justify kissing a lot of frogs (In fact, how much would you pay for a million John von Neumanns?)

This week two of the most interesting thinkers of the internet era, Vitalik Buterin (co-founder of Ethereum) and Tanner Greer (much discussed in TiB), posted new essays on the topic of legitimacy. They’re very different, but worth reading in parallel.

Greer’s essay, “On Laws and Gods”, is a whirlwind tour across millennia and continents that looks at the question, where have people believed that legitimate authority comes from? Riffing on - and arguing with - Hannah Arendt, Greer shows that the historical and global norm has been “authority from the absolute” - e.g. authority from God, natural law or “self-evident truths”. The exceptions, such as ancient Athens, are notable partly for their rarity. Towards the end of the essay Greer makes a particularly important point:

As I’ve argued before, the defining characteristic of the internet age is scale. So where can legitimacy come from today, in a globalised world with dwindling faith in absolutes? One popular trope in the crypto world is that Bitcoin and its brethren are backed by (absolute) mathematics, unlike fiat currency backed by fickle politics. This is not the line Buterin takes, though. His excellent essay highlights that even blockchain-based ecosystems rely on a social contract to confer legitimacy. Without legitimacy, even math(s) can be “undone” - there are no quick fixes. As Greer concludes:

The geopolitics of the semiconductor industry is probably the most interesting tech story in the world right now and, relative to media coverage, perhaps the most interesting story full stop (see previous coverage). Global demand for semiconductors from private, public and national security customers is rocketing, but the supply of foundries that can make them is fixed in the short run, which creates a huge shortage. Moreover, the biggest and most advanced fabs are physically located in the world’s most fraught geopolitical hotspot, Taiwan. Ben Thompson had a superb write up last year:

As a result, “semiconductor independence” is high on the agenda for the EU, China, the US and others. This is the important context for Intel’s big (and well received) announcement last week that it will build a semi-independent foundry business with a focus on creating manufacturing capacity outside Asia (though Europe may be left behind again).

This is a relatively challenging topic to follow, though mainstream media coverage is improving (The Economist has been excellent - see here and here). In addition to the essential Stratechery, I highly recommend subscribing to at least the free version of Mule’s investment-focused semiconductor newsletter (see here and here for excellent free posts) and Bharath Ramsundar’s amazing Substack that goes deep but accessibly into the technology. The industry is only growing in importance and its spillover effects are everywhere; it’s well worth spending time on.

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Until next week,

Matt Clifford