DEEPSEEK: THE AMBIGUITY OF DE-COMMODIFICATION

The paradox is that the de-commodification of AI programs, although a step out of capitalism as we knew it, ultimately strengthens the reign of our new feudal masters

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Communist countries until 1990 elevated the quantity of steel produced into the ultimate measure of progress—and this obsession was their downfall. Recall that the goal of the “Great Leap Forward” in China in the late 1950s—which ended in a mega-catastrophe with tens of millions dead from starvation—was to surpass the United Kingdom in steel production. In the years since ChatGPT’s debut, the world of artificial intelligence has been defined by a similar obsession: scale. Companies have raced to build ever-larger models, train on datasets of unimaginable size, and spend billions on the infrastructure required to sustain this rapid growth.

No wonder the launch of the new chatbot by China’s DeepSeek was perceived as a “wake-up call” for U.S. tech firms in the global race to dominate artificial intelligence. The emergence of DeepSeek, which has built its R1 model chatbot at a fraction of the cost of competitors such as OpenAI’s ChatGPT and Google’s Gemini, wiped $1 trillion in value from the leading U.S. tech index on January 27. Although values were later largely recuperated, the shock remained. The launch of DeepSeek’s R1 model was compared to a pivotal moment in the U.S.-USSR space race: it was characterized as AI’s “Sputnik moment,” referring to when the Soviet Union surpassed the U.S. by launching the first satellite into orbit.

Reactions from the U.S., as expected, are full of hypocrisy. On January 27, 2025, Trump commented on DeepSeek's ability to deliver comparable performance to existing AI models with far fewer resources, threatening the dominance of the U.S.-led AI boom: “That’s good because you don’t have to spend as much money. I view that as a positive, as an asset.” Joke of the year: Trump knows this is BAD for the U.S. Along similar lines, Sam Altman, CEO of OpenAI, said: “DeepSeek’s R1 is an impressive model, particularly around what they’re able to deliver for the price. We will obviously deliver much better models and also it’s legit invigorating to have a new competitor.” Why “obviously”? If it is so obvious, why then is there such panic in the U.S. about finishing second in the AI race?

A key point is rarely mentioned: DeepSeek's assistant and underlying code are publicly accessible and can be downloaded for free, which goes directly against Trump’s orientation. While Trump recognizes AI's importance, he approaches it in an old-fashioned “big is better” Communist way. He announced a $500 billion AI infrastructure investment in the U.S., involving three top tech firms that will create a new company called Stargate to grow artificial intelligence infrastructure domestically.