{"id":308530,"date":"2025-12-01T12:00:16","date_gmt":"2025-12-01T12:00:16","guid":{"rendered":"https:\/\/www.transcend.org\/tms\/?p=308530"},"modified":"2025-11-27T05:34:09","modified_gmt":"2025-11-27T05:34:09","slug":"capitalism-and-the-cloud","status":"publish","type":"post","link":"https:\/\/www.transcend.org\/tms\/2025\/12\/capitalism-and-the-cloud\/","title":{"rendered":"Capitalism and the Cloud"},"content":{"rendered":"

The Dangers and Costs of the AI Bubble<\/em><\/p><\/blockquote>\n

24 Nov 2025 – <\/em>A giant, hydra-headed specter is haunting the UK. In part, this phantom is visible, knowable. But we can\u2019t easily discern its form or understand its impact.<\/p>\n

In the past, one could arrive in a British town or city and immediately encounter physical, working monuments to public infrastructure based on the socialisation of risks and needs. We\u2019re talking about visible things like schools, post offices, electricity stations, railway terminals, and telephone exchanges.<\/p>\n

Today, visitors confront \u2013 or don\u2019t \u2013 much ghostlier visages: about 500<\/a> barely-seen data centres, or \u2018clouds\u2019. Readers may not know the site of their nearest existing or future \u2018cloud\u2019, but its destructive power is tremendous, matched only by a desire to keep you at a distance.<\/p>\n

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\"\"<\/a><\/p>\n

Data centres are active or underway in much of the country, many in the south-east corridor, that polite way of saying \u2018London\u2019 and its environs<\/a>. Big business needs to be near the centre of politics, corporations, and the City, data \u2018must\u2019 travel fast, and three-quarters<\/a> of the nation\u2019s artificial intelligence firms are in this corridor.<\/p>\n

Last year, companies spent \u00a31.75 billion on building \u2018clouds\u2019 in Britain. Expenditure<\/a> on new centres is estimated to be \u00a310 billion a year by 2029. Most of this new investment comes not because of increased demand for email, video, journalism, education, sports, or so-called social media. It\u2019s due to Meta, Google, Amazon, and Microsoft being drunk on AI.<\/p>\n

All four have willing sales reps. Their chief UK manservant, Keir Starmer has undertaken to \u2018inject AI into the veins of this enterprising nation.\u2019<\/a> The glorious-leader-who-brooks-no-dissent and his merry band of Whitehall pranksters are confident the technology \u2018will deliver a decade of national renewal\u2019.<\/p>\n

Starmer and his kind, hegemons of governments, universities, corporations, and religions, guarantee a new world. So ghostwriters for his friend in the White House promise that<\/a>: \u2018Winning the AI race will usher in a new golden age of human flourishing, economic competitiveness, and national security for the American people. An industrial revolution, an information revolution, and a renaissance\u2014all at once.\u2019<\/p>\n

These people aren\u2019t sharing the reality with us. It\u2019s not pretty, and it\u2019s not something one would wish injected into one\u2019s veins, enterprisingly or otherwise.<\/p>\n

Our focus here isn\u2019t on the suicides associated with ChatGPT<\/a>, nor the risks of AI acting against humans<\/a>, the systematic disinformation demonstrated in election campaign after election campaign across fifty countries<\/a>, or what the Financial Times <\/em>(!) terms \u2018America\u2019s AI Colonialism<\/a>\u2019.<\/p>\n

The AI bubble<\/strong><\/p>\n

We\u2019ll concentrate on two themes. The first is the current stock-market boom, based on the construction of data centres to service AI.<\/p>\n

Time after time, surges of irrational investment in new communications technologies have produced economic chaos<\/a>. Today\u2019s implications are broader, deeper, and more dire. Amazon, Google<\/a>, Meta, and Microsoft dedicated $350 billion to building \u2018clouds\u2019 this year, with $400 billion scheduled for 2026<\/a>. The rush is on<\/a>, driven by a fear of missing out. Techbro FOMO may be preventing US recession<\/a>, but the Bank of England<\/a> discerns similarities with \u2018the peak of the dot com bubble,\u2019 aggravated by the trillions soon to be borrowed.<\/p>\n

It\u2019s likely that costs will spiral and the technology grow \u2018obsolete far quicker than anticipated<\/a>, requiring new investment that decreases returns for its owner\u2014or forces them to sell at a discount.\u2019 Subsequent stock-market catastrophes will probably ruin small-to medium-sized participants while huge platforms sup on the remains<\/a>.<\/p>\n

Forget for a moment the obvious problem of capitalist over-production. Assuming the hysteria \u2018self-corrects\u2019, what is the evidence for AI doing what the manservant and his mandarins promise?<\/p>\n

Nobel laureate Daron Acemoglu<\/a> finds little support for claims of dramatic economic growth through AI. He predicts its stimulus to productivity over the next decade may reach a towering 0.53%, accompanied by worsening wage inequality. Geoffrey Hinton<\/a>, who won his Nobel Prize for machine learning, says the new technology \u2018will make some people much richer and most people poorer.\u2019<\/p>\n

Data centres employ few people<\/a> once their construction is complete. Filipino and Colombian<\/a> workers enter AI data for US corporations<\/a> for $1.50 an hour. Mid-level US office staff devote 15% of their time<\/a> to correcting mistakes AI makes every day. Is that the future for Starmer\u2019s \u2018enterprising nation?\u2019<\/p>\n

Meanwhile, despite $30-40 billion of business investment in GenAI, 95%<\/a> of organisations report zero improved business performance. Pharmaceutical companies have been in the vanguard, and their decade of vast AI expenditure has produced virtually nothing<\/a>. The Economist<\/em> notes<\/a> that \u2018faith in great God-like language models is waning,\u2019 its advances \u2018akin to boring phone upgrades.\u2019 Watch for an economic disaster coming to a \u2018cloud\u2019 near you.<\/p>\n

Ecological disaster<\/strong><\/p>\n

Our second focus is on AI\u2019s environmental impact, due to the gigantic number of data centres \u2018needed\u2019 to make it happen. Unlike the working monuments mentioned above, many are inconspicuous; some nestled in areas zoned for office life, others located in the countryside or small cities. The newest are huge, and private.<\/p>\n

The term \u2018cloud\u2019 artfully obscures the fact that data centres are buildings. By associating them with natural precipitation, it diverts attention from their use of resources.<\/p>\n

For these all-too concrete, all-too corporate places are hungry for power, thirsty for water, and set to dominate global ecology. Two years ago, \u2018clouds\u2019 consumed the same amount of energy as Britain<\/a>. The International Energy Agency<\/a> predicts that within a decade they will require as much as India. In addition, the techbros\u2019 data-centre fetish draws water from some of the driest areas of the world<\/a> to cool their \u2018clouds\u2019. Google\u2019s used six trillion gallons of water in 2024, a third of Turkey\u2019s drinking supply<\/a>.<\/p>\n

At an individual level, each ChatGPT request we make consumes ten times the energy of a conventional Google query<\/a>. A brief conversation with GPT-3<\/a>, or a hundred words sent via email, relies on 500 millilitres of water to cool data centres.<\/p>\n

Watch for an environmental disaster emanating from a \u2018cloud\u2019 near you.<\/p>\n

There is some responsible journalistic coverage<\/a> of these issues, such as the financial press warning of collapse and the Guardian<\/em> reporting that a huge new centre in Lincolnshire<\/a> \u2018could cause more greenhouse gas emissions than five international airports\u2019.<\/p>\n

And there is popular resistance internationally, for example Spain\u2019s Tu Nube Seca Mi R\u00edo<\/a> [Your Cloud is Draining My River Dry] and the Movimiento Socio Ambiental Comunitario Por el Agua y el Territorio<\/a> (the Socio-Environmental Community Movement for Water and Land) in Chile. These movements organise demonstrations, talks, media interventions, and policy critiques, insisting on scientific and community evaluation of data centres\u2019 ecosocial impact.<\/p>\n

Global Action Plan<\/a> calls for serious discussion of saving the planet versus dutifully obeying the men of Silicon Valley. Greenpeace<\/a> laments that \u2018our climate and our lungs will pay the price\u2019 of the bubble. Foxglove<\/a> launches a legal challenge against \u2018cloud\u2019 construction. Mild-mannered groups such as CPRE\u2014The Countryside Charity<\/a> note with some alarm that Labour is quietly excluding basic environmental norms from construction approvals. And protests have begun against what activists call \u2018clanker,\u2019<\/a> troping a Star Wars<\/em> gaming term for droid robot soldiers.<\/p>\n

Such actions can counter AI\u2019s deleterious impact, not just on our emotions, elections, and jobs, though they are crucial, but the very survival of our planet.<\/p>\n

It\u2019s a formidable task: the techbros have spent\u00a0 $100 million on superficially-independent coin-operated organisations<\/a> to oppose regulation of data centres and copyright obstacles to AI.<\/p>\n

All that said, none of the above matters if you subscribe to the White House\u2019s AI plan<\/a>, Removing Barriers to American Leadership in Artificial Intelligence<\/em>.<\/p>\n

It rejects \u2018radical climate dogma,\u2019 favouring a path to \u2018victory\u2019 that refuses \u2018references to misinformation, diversity, equity, inclusion and climate change.\u2019 Donald J Trump has called for censorship of any \u2018woke Marxist lunacy\u2019<\/a> lurking within AI.<\/p>\n

The UK government\u2019s consultants <\/a>guarantee energy savings from the technology and its AI Energy Council will \u2018make sure supply can meet demand, alongside \u00a3104bn in water infrastructure investment<\/a>.\u2019 Amazon, Microsoft, Google, and government entities dominate the membership<\/a>. There\u2019s no scholarly, worker, or activist participation.<\/p>\n

So that\u2019s all fine, then. Sit back, relax, and let Keir Starmer open your veins.<\/p>\n

This won\u2019t hurt a bit. The giant unseen spectre will take care of your every need.<\/p>\n

Or we resist.<\/p>\n

_____________________________________________________<\/p>\n

\"\"<\/a>Joan Pedro-Cara\u00f1ana is Associate Professor at Computense University of Madrid and a member of the Latin Union of Political Economy of Information, Communication and Culture (ULEPICC).<\/em><\/p>\n

 <\/p>\n

Toby Miller is Distinguished Professor, Instituto Tecnol\u00f3gico de Monterey, Mexico.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

The Dangers and Costs of the AI Bubble<\/p>\n","protected":false},"author":4,"featured_media":217932,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3078],"tags":[1733,232],"class_list":["post-308530","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-artificial-intelligence-ai","tag-artificial-intelligence-ai","tag-capitalism"],"_links":{"self":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/308530","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/comments?post=308530"}],"version-history":[{"count":2,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/308530\/revisions"}],"predecessor-version":[{"id":308535,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/posts\/308530\/revisions\/308535"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media\/217932"}],"wp:attachment":[{"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/media?parent=308530"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/categories?post=308530"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.transcend.org\/tms\/wp-json\/wp\/v2\/tags?post=308530"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}