DeepIrony

China innovates as America burns

Credit to Tawni Marshall on BlueSky

So, uh, you may have heard that the entire AI economy has collapsed?

I kid! Overstatement! But, as you probably know, a Chinese startup company called DeepSeek recently released a large-language model AI that by multiple measures appears to be as powerful as the most advanced versions of ChatGPT, but operates at a fraction of the latter’s cost. This has made many a venture capitalist and equity investor in AI-related technologies go, “huh, maybe the idea that we need to build a $500 billion ‘Stargate’ and re-activate Three Mile Island in order to fuel this technology with an as-yet unproven business model is not going to pay off.” Stocks were sold, prices went down.

Around these parts I generally avoid writing “hot takes” about the latest AI-related stories that are in the news—therein lies madness. Likewise, I’ve mostly tried to steer clear of writing about the business side of AI, since that’s not my lane. True, I broke that rule a few weeks ago when a thread I posted to BlueSky about OpenAI and its founder/CEO giving me Enron-esque vibes went viral (leading to this essay), but let’s just call that the exception that proves the rule.

All of which is to say, I don’t know what yesterday’s events portend for the companies that are pushing AI into our lives as furiously fast as they can, and I recommend maintaining a skeptical posture toward anyone making confident predictions right now. What’s more, I further regret to inform you I’m as-yet unable to comment on the capabilities of DeepSeek’s so-called “reasoning” model itself—I tried to sign up to use it yesterday and couldn’t. No hot model takes here, sorry.

What I do feel semi-qualified to opine on, however, is education, and in particular, how China’s education policy contrasts to the policy of national intellectual suicide that’s taking place in the United States at the moment.

Let’s start with China. As some but perhaps not all Cognitive Resonance readers may know, I previously led an education nonprofit organization dedicated to improving schools of education in the US, the programs within universities that prepare people to be classroom teachers. In the decade of doing that, I worked with hundreds of deans and faculty as institutions of higher education that range from some of our most prestigious to some of our most obscure.

Through that work, several years ago I noticed something interesting happening—a non-trivial number of academic leaders that I worked with had “side hustles” consulting in China. By that I mean that they were being paid to come over and help Chinese institutions of higher education improve. It became very clear to me through conversations I had with these academics that China, as a matter of national policy, was and is trying to emulate the American university system, which—for all its many flaws —has been the envy of the world.

Yesterday felt like the moment where the fruits of China’s investment in its education system became visible for all to see. Indeed, as as DeepSeek’s CEO Liang Wenfeng explains in this interview (worth reading in its entirety), the company has largely if not exclusivly hired young, newly minted PhDs from Chinese universities:

Interviewer: Jack Clark, former policy director at OpenAI and co-founder of Anthropic, said that DeepSeek hired “inscrutable wizards.” What kind of people are behind DeepSeek V2?

Liang Wenfeng: There are no wizards. We are mostly fresh graduates from top universities, PhD candidates in their fourth or fifth year, and some young people who graduated just a few years ago.

Interviewe: Many LLM companies are obsessed with recruiting talents from overseas, and it’s often said that the top 50 talents in this field might not even be working for Chinese companies. Where are your team members from?

Liang Wenfeng: The team behind the V2 model doesn’t include anyone returning to China from overseas — they are all local. The top 50 experts might not be in China, but perhaps we can train such talents ourselves.

There are no wizards. If we for a moment (and just for a moment) indulge in econometric thinking about education, the investments do not bear immediate dividends—the yield is long-term. DeepSeek is hiring PhDs from Chinese universities because it can. Along similar lines, I popped back over to X yesterday to assess the freakout vibes and found this, which is just too perfectly on point:

Credit to PITTI DATA (?) for pic; book is The Coming Wave: Technology, Power, and the Twenty-First Century's Greatest Dilemma by Mustafa Suleyman and Michael Bhaskar

The point about AI defeating champion Go players leading to China’s “Sputnik moment” is interesting, but it’s the non-red-boxed paragraph on the second page I want you to pinch to zoom on. Here’s the punchline: China is surging “across the spectrum of fundamental technologies, investing in an epic scale, a burgeoning intellectual property behemoth.” As someone who spends a non-trivial amount of his time reading AI research papers, trust me, the volume being produced by Chinese scholars is impossible to miss.

All of which leads me to the DeepIrony of the present moment (sorry). At the very same time that we see Chinese innovation arising from the investments they’ve made in their education system, the Trump Administration is waging outright war on the American system of research and development. Federal grant funding to universities has been “paused.” So too has the work of the National Science Foundation and the National Institute of Health. Departments and events related to addressing America’s history of white supremacy have been cancelled. Plans are in motion to take control of university accreditation to make it explicitly ideological.

Put simply, various right-wing apparatchiks at the federal and state level, having correctly seen that American universities are the last remaining bastions of power that they’ve yet to co-opt, now aim to radically reshape—and in the end, destroy—the role that these institutions play in American society.

When Brexit happened, I remember reading the comment of some European diplomat describing it as an “extraordinary self-blockade.” Well, the American government is now trying to self-sabotage our intellectual institutions—a civil war, but for knowledge. My only hope, if it can even be called that, is the ensuing damage will be temporary, and that four years of this Administration will prove insufficient to make the policy of Ignorance as Strength take root.

But the trendlines are not good.