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AI capex is so big that it's affecting economic statistics

(paulkedrosky.com)
338 points throw0101c | 5 comments | 18 Jul 25 19:59 UTC | HN request time: 0.899s | source
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jonas21 ◴[18 Jul 25 21:09 UTC] No.44609857[source]▶
I don't know... 1.2% of GDP just doesn't seem that extreme to me. Certainly nowhere near "eating the economy" level compared to other transformative technologies or programs like:

- Apollo program: 4%

- Railroads: 6% (mentioned by the author)

- Covid stimulus: 27%

- WW2 defense: 40%

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raincole ◴[18 Jul 25 21:18 UTC] No.44609942[source]▶
Yeah that's my first reaction to. 1.2% doesn't sound much. It's just people making headlines out of thin air. If it lists the water and energy consumption I might be more concerned.

Slightly off-topic, but ~9% of GDP is generated by "financial services" in the US. Personally I think it's a more alarming data point.

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giantg2 ◴[19 Jul 25 01:00 UTC] No.44611558[source]▶
Why is 9% for financial services bad? This should cover fees/interest from everything like loans, transactions, mortgages, advice, investing, etc. It doesn't seem that surprising to me that the systems that are the backbone for all the money operations that power the rest of the economy make up about 10%.
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dontlaugh ◴[19 Jul 25 02:43 UTC] No.44612103[source]▶
9% is very inefficient.
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wavemode ◴[19 Jul 25 03:16 UTC] No.44612265[source]▶
"Inefficient" implies the money is being burned or something. It's flowing into the pockets of people who work in the financial services industry, who then spend it on other things. The economy isn't zero-sum.

And the industry itself greases the wheels of other industries. In other words without financial services like lending and payment processing there would be less spending and investment overall, so other industries would shrink along with it.

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1. dontlaugh ◴[19 Jul 25 03:24 UTC] No.44612320[source]▶
That’s a lot of money for “greasing”. Nearly 10% on any kind of overhead is generally considered a lot.

Central planning is drastically more efficient, for example. It’s why large companies use it internally.

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2. hatefulmoron ◴[19 Jul 25 03:40 UTC] No.44612383[source]▶
Is there any evidence that central planning on a much larger scale is drastically more efficient? We're talking about a whole country, after all. I take your point that companies themselves are usually centrally planned internally, but centrally planned economies haven't fared so well.
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3. 9rx ◴[19 Jul 25 07:47 UTC] No.44613435[source]▶
> Is there any evidence that central planning on a much larger scale is drastically more efficient?

If it were, why do we have more than one company?

> I take your point that companies themselves are usually centrally planned internally

Well, sort of. It is true that companies exist solely for the reason of exploiting efficiencies in central planning. If central planning was always inefficient, companies wouldn't exist! But, as I alluded to earlier, no company has found central planning to be efficient in all cases. Not even the largest company in the world centrally plans everything. Not even close.

As with most things in life, a bit of balance will serve you well.

4. bluGill ◴[19 Jul 25 11:09 UTC] No.44614461[source]▶
Large companies are all decentralized. The ceo will set broad direction but they always leave details to the lower levels. Those lower levels often do things that are against the needs of a different division. Companies are reorganizing for efficiency all the time.
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5. 9rx ◴[19 Jul 25 14:52 UTC] No.44615943[source]▶
> Large companies are all decentralized. The ceo will set broad direction but they always leave details to the lower levels.

Typically, central planning does not imply micromanagement. The "broad direction" you speak of is the central planning.

> Companies are reorganizing for efficiency all the time.

But, of course, companies wouldn't exist if markets were perfectly efficient. The sole reason for companies is to exploit the efficiencies of central planning. But, of course, just as if markets were perfectly efficient there would be no companies, if central planning was perfectly efficient there would only be one company, so... Like always, there are tradeoffs that we have to find balance in.