Artificial Intelligence Then and Now
From engines of logic to engines of [FORUM NAUGHTY WORD]?
by Thomas Haigh, University of Wisconsin
appears in “Communications of the ACM”, February 2025
https://dl.acm.org/doi/10.1145/3708554
We read among others:
ChatGPT took AI hype to a new level. In June 2024 Nvidia, producer of the graphics processors on which most AI models run, achieved the highest market valuation of any company in the world. As I write, its valuation fluctuates around those of Microsoft, Apple, and Google whose share prices were also inflated into multi-trillion dollar territory by investor enthusiasm for AI. As companies across a wide range of industries started to talk up their investments in AI during earnings calls with investors, analysts have called this AI frenzy the driving force behind a major global stock market rally.
Few if any companies have yet demonstrated major cost savings from the deployment of generative AI. In tests, language models like ChatGPT have so far proven themselves as productivity aids mostly by integrating predictive text into programming environments, as computer code is far more structured than natural language.
The immediate applications opened up by driving down the cost of bespoke [FORUM NAUGHTY WORD] generation are real but not particularly hopeful centering mostly of student plagiarism, personalized propaganda, misinformation, clickbait, search engine spam, scams, and fake news. For example, websites are now generating fake obituaries of accident victims to earn tiny amounts of advertising revenue from visitors.
Will generative technologies ultimately displace workers? Perhaps, but there’s nothing unusual about technology eliminating jobs. The work most people did in 1800 or 1900 has long since been automated. Computers have been replacing white-collar workers for decades. What’s different this time around is that the machines seem to be coming for the jobs of people who earn their livings writing columns, expressing opinions, or appearing on television. They are understandably more shocked by the prospect of their own jobs vanishing than those of boot makers, bank tellers, or file clerks.
The investment boom is driven not by proven savings [note by me: yes, we have had a money-printing tsunami never seen in history which explains the stockmarket valuations] or actual productivity growth but by faith that we can achieve AGI by building bigger and better language models, feeding them ever larger quantities of training data and running then in ever more powerful server farms. Investor enthusiasm for generative AI continues to grow even as slightly earlier waves of AI-branded technology collapse. Voice-powered assistants were supposed to transform our lives and make fortunes for companies that harvested our data and used it to sell us things, a model dubbed surveillance capitalism by its critics. Amazon lost tens of billions of dollars on its Alexa devices, before firing thousands of workers and paring them back to basic functions. Truly autonomous cars have been promised, most notably by Elon Musk, for many years but remain elusive despite massive investment.
Even if generative AI technology ultimately lives up to the hype, investors will surely be disappointed. History suggests that investors in the hottest areas always are. Railroads transformed the U.S. in the second half of the 1800s, but overexcited European investors drove massive overbuilding. J.P. Morgan built his fortune by consolidating the struggling industry on the cheap during the 1880s. Investors of the 1990s were not wrong about the Internet being a big deal but they still bid up stocks beyond all reason [note by me: also due to free money from the presses, aka. the Clinton-Greenspan bubble]. In March 2000, Cisco briefly became the world’s most valuable company, as investors bet on its domination of the market for networking equipment. Today, Cisco no longer appears in the top 50 despite higher sales and bigger profits.
