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Wall Street seems to be noticing that the data center boom is being financed based on wildly optimistic revenue projections as unfinished projects and unused chips pile up.
Meanwhile, the “philosophical” claims of AI boosters (“AI Agents are intelligent and deserve equal rights”) are getting more extreme, even as their credibility takes hit after hit.
Let’s start with Oracle out in the desert.
Oracle Plays Rare ‘Force Majeure’ Card
These rich kids and their card games; some of them have cards in their deck no one else has. Oracle CEO Larry Ellison is no exception, pulling out a very rare “force majeure” card to protect itself should one of its “Stargate” data centers in New Mexico not come online as scheduled. Per Bloomberg (archived):
Oracle Corp. is moving to shield itself from racking up expenses on a massive data center being built in New Mexico, adding a fresh wrinkle to a project beset by opposition and regulatory setbacks.
The technology giant sent the project’s developer, a unit of Blue Owl Capital Inc., a notice citing force majeure, according to people familiar with the situation. Rather than trying to walk away as the site’s main tenant, Oracle is attempting to put off payments should the data center dubbed Project Jupiter get derailed and fail to come online in 2028 as planned, the people said, asking not to be identified discussing private matters.
“The people said,” that’s some remarkable anonymous sourcing right there. Were these people the reporter met behind a 7/11 in Truth or Consequences, New Mexico, or what?
But that’s neither here nor there. After hearing from both Oracle and Blue Owl spokesweasels that force majeure is totally common, everyday stuff, the piece gets down to brass tacks about what this means for the project announced with such fanfare by Donald Trump, Larry Ellison, Masayoshi Son of SoftBank, and OpenAI’s Sam Altman in early 2025:
If the two sides agree that a force majeure event tied to meeting power commitments has occurred, then Oracle could win a three-year delay on rent when those payments commence, one of the people said. The company would still have to pay other costs in the interim and owe the rent for the full lease term once payments begin, the person said.
…
Almost two years later, the campus designed to handle 2.45 gigawatts — enough electricity to power roughly 1.8 million homes at any given moment — has hit serious setbacks including the denial of a permit key to its plans for energy resources.
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A group of about 20 banks provided an $18 billion loan to help fund the construction of the data center campus, one of several mega-debt deals that have helped bankroll the AI infrastructure boom.
Bloomberg also does some contortions to make “force majeure” seem like a totally normal, everyday business move:
Force majeure provisions are relatively common in the energy and commodities world when events such as bad weather and geopolitical conflicts disrupt supplies, leaving companies unable to fulfill their contracts. The clauses are becoming more common in data center developments as well, according to a recent client alert from Quinn Emanuel Urquhart & Sullivan LLP.“In AI data center projects, force majeure is no longer a back-end boilerplate provision,” the June alert said. “It is a core litigation and risk-allocation tool that can determine whether a delay remains isolated — or cascades through the project’s construction, customer, power, insurance, and financing documents.”
Big Short investor folk hero Steve Eisman points out that ‘force majeure’ is an “Enron-era trick” and it doesn’t take much Googling to confirm that the “smartest guys in the room” had the force majeure card in their deck and weren’t afraid to employ it.
Axios pointed out that this kind of thing had an immediate impact on the cost investors seeking to protect themselves from an Oracle default have to pay:
— Nat Wilson Turner (@natwilsonturner) September 28, 2026
Of course, the fact that Larry Ellison is also trying to buy his nepo-baby failson David, a media empire, and recently put up another $9.2 billion in Oracle stock up as collateral against personal loans — or about 36% of his personal holdings — can’t be a comfort to Oracle shareholders either.
Larry’s antics have also helped draw negative attention to the whole data center buildout.
Brookings, Moody’s, Morgan Stanley, The Economist: Trying to Ruin the Party, Why?!?
I don’t know if anyone has told Stijn Van Nieuwerburgh of the Columbia Business School that he wasn’t invited to the party, but he insisted on dropping a big turd in the punchbowl via his report for Brookings on “Financing the AI Buildout.” The report contains totally irrelevant no-fun factoids like:
“The projected buildout would be larger relative to the economy than the major U.S. canal, railroad, electrification, highway, and telecommunications investment booms,” writes the author, Stijn Van Nieuwerburgh of Columbia University.
The paper warns that the risks embodied in the AI investment race are migrating from transparent on-balance sheet financing by major corporations to opaque off-balance sheet financing through joint ventures, private credit, securitization, special-purpose vehicles, lease commitments, loan guarantees, and other structures.
These off-balance sheet arrangements then depend on AI companies’ cash flows and collateral values, which are subject to “uncertain AI demand, rapid technological change, timely access to power and hardware, and the continued credit quality of a small number of [data center] tenants,” Nieuwerburgh writes.
He writes that “it would be premature to conclude that AI infrastructure already poses systemic risk comparable to earlier credit booms” but notes that “off-balance sheet structures matter … because they may make correlated exposures hard to observe before a downturn.”
And do tables like this really clarify anything?
— Nat Wilson Turner (@natwilsonturner) September 28, 2026
And this table based on the Brookings report from Hanno Lustig at the Two Cents Substack, is it really helping?
— Nat Wilson Turner (@natwilsonturner) September 28, 2026
And elaborations like this are just a dream-killing pile on:
What do you have to believe about future revenue in order for all data center owners to to break even on their AI investment? Using a 10% discount rate, Stijn’s baseline number is 3.725 trillion of annual revenue by 2032, which would amount to roughly 9.2% of projected 2032 GDP.1 This number is the top line earned from selling compute in aggregate by whoever operates the 182.7 GW of US capacity completed by 2032.2 Today’s U.S. compute revenue base is on the order of $0.3 trillion. To reach $4 trillion by 2032, total data-center revenue needs to grow at roughly 45% per year for seven years.
The assumptions behind that number:
- 183 GW of U.S. data-center capacity completed between 2025 and 2032
- $8.54 trillion of construction cost, grossed up to a $9.61 trillion capital base to account for the return on capital tied up during construction
- A 10% discount rate
- A 6-year life for IT equipment (68% of cost) and a 20-year life for everything else (32%)
- A 50% operating cash flow margin
And then Moody’s felt obliged to get in on the act with “Hyperscalers’ reported AI-related lease commitments may understate economic risk.” Some quotes from CNBC’s summary:
Moody’s said that the spending surge is forcing even the world’s most cash-rich corporations like Alphabet and Microsoft to lean heavily on debt, stock sales and off-balance-sheet moves to fund their AI ambitions.
“Previously, these companies relied on asset-light structures centered on software, intellectual property, and scalable cloud services that required modest capital investment,” Moody’s said in the Wednesday note. “The transition from asset-light to asset-heavy models requires unprecedented levels of investment and capital raising.”
The moves “threaten credit quality” for the six companies tracked by Moody’s, which include Microsoft, Amazon, Alphabet, Meta, Oracle and CoreWeave, according to the report.
The ratings firm projects that capital expenditures — or capex, which are investment for physical assets like data centers — will hit $785 billion in 2026 before reaching about $1 trillion next year.
Fun stuff.
Then Morgan Stanley joined in on the curbstomping by asking a totally irrelevant who cares besides nerds question, “OK, so where are all these data centres?” via FT.com:
The big gap between consensus forecasts for chip sales and US data centre completions.
Morgan Stanley measured the gap earlier this week by estimating the shortfall in available power, concluding that more than half of the GPU servers sold between 2026 and 2028 might not have anywhere to be plugged in. New research from Jefferies analysts reaches a similar conclusion using a very top-down method: space.Tracking US data centre construction sites by satellite imagery shows between 16 and 18 gigawatts on track for completion this year, the broker says, citing SynMax Intelligence.SynMax estimates when data centres are likely to become operational by tracking when land is cleared, when construction begins and how the build progresses. It pushes out the timeline if the land’s not cleared on schedule, no matter what the companies involved are claiming.
By its measures, there are around 2 GW of US data centre projects scheduled for completion in 2026 that are yet to start on the land clearances, making them “impossible” to deliver on time.
And even Callum Williams, the Economist’s SF bureau chief felt compelled to post the following chart on Elon Musk’s X.com:
World seems to have woken up to the idea that AI capex actually needs a return at some point. People now realise that roughly $2-3trn of revenue will be needed annually, quite soon.
But the conversation about what counts as “AI revenue” is still highly unsophisticated. People… https://t.co/p8qzawFq4m pic.twitter.com/dA2PC6lHKK
— Callum Williams (@econcallum) September 27, 2026
It’s so annoying when our tech visionary class is busy building trillion-dollar cloud castles to have these totally earth-bound grinds pointing out that they’re not even built on sand.
Fortunately, our visionary class has more important things to discuss, like how many AI agents can dance on the head of a pin or do “Androids Dream of Electric Sheep,” or didn’t you even see Blade Runner?
The Wall St Journal on Effective Altruists at Anthropic
Word has been getting around about the “philosophical school” behind Sam Bankman-Fried’s fraudulent, but allegedly well-intentioned, FTX empire is playing a big role at Anthropic, but who told the normies at the Wall Street Journal?
From the destined-to-be a classic of the genre “Things Will Never Be Chill Again: The Doomers Who Shaped the AI Safety Freakout
Inside Berkeley’s tallest office building, a small community of artificial intelligence researchers at a co-working space called Constellation has been mobilizing to save the world from apocalypse.
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They’ve refined their arguments in Bay Area group houses, and traded predictions at freewheeling conferences in Berkeley and the Bahamas. They’ve floated ideas like buying remote islands, stockpiling iodine pills, or moving to electromagnetically shielded bunkers in the desert. At one 2022 event, the drink menu included a cocktail called “Death With Dignity,” in reference to an essay arguing humanity was already doomed.So-called doomers like those at Constellation have also steered the development of AI itself. They were among the earliest employees at OpenAI and Anthropic, both of which were founded on the principle of staving off AI dangers. And they have kept up their influence, drawing some staffers and funding for their projects from a network aligned with a philosophy called effective altruism—including from Sam Bankman-Fried, the former chief executive of the fallen crypto exchange FTX who is now serving out a 25-year prison sentence.
The AI safety community’s influence has been particularly strong at Anthropic, which is now on the cusp of a $2 trillion public offering. Employees there trade doomsday scenarios and how to prepare for them on a private Slack channel, and have come to embrace a motto they stick on their laptops: “Things will never be chill again.”
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The subculture organized around the fear that AI could kill us all began to coalesce more than a decade before the invention of the underlying technology that enabled it.Its intellectual leader was Eliezer Yudkowsky, a Bay Area autodidact who dropped out of middle school. By the mid-2000s, he was blogging voluminously about cognitive biases and running an institute devoted to warning about the risks of runaway AI. He referred to himself as a “rationalist.”
One of his readers was a young Princeton physics doctoral student named Dario Amodei. He had been preaching utilitarianism—the idea of doing the most good for the most people—since high school. Now the chief executive of Anthropic, Amodei co-hosted a meetup for members of Yudkowsky’s blogging community in 2008.
That same year, Amodei stumbled on a link on an economics blog that led him to a nonprofit charity-evaluator called GiveWell. Founded the previous year by former Bridgewater Associates hedge-fund analysts Holden Karnofsky and Elie Hassenfeld, it aimed to help donors maximize the good done per dollar donated, usually measured in lives saved.
Amodei began leaving comments on the GiveWell blog, and once guest-blogged on it directly. In the 2010 post, he deployed utilitarian reasoning while weighing whether to give $10,000 to one charity rather than another: “I think an adult death is perhaps 2 or 3 times worse than an infant’s death” he wrote, qualifying that both deaths “are of course bad.”
Oh boy. Poor Dario, just wandering around the Princeton campus one day and coming across the ideas of one of the great magic bean salesmen of our era. Surely his fringe ideas can’t survive the scrutiny of the mainstream’s best mind?
Ross Douthat, Credulous Stooge or Fearless Truth Seeker?
The New York Times is truly fulfilling its essential function of deciding what news is fit to print by bringing together the greatest minds of our era and putting them through the brutal Ross Douthat acid test.
Sextus Empiricus himself would blanch at the brutal barrage of critical thinking and shrewd skepticism brought to bear by Douthat when he presents “Anthropic’s Chief on A.I.: ‘We Don’t Know if the Models Are Conscious’.”
Read and weep this excerpt from the conversation between Anthropic CEO Dario Argento Amodei and Ross Douthat:
Ross Douthat: I want to pause you there, because one of the interesting things about your framing in that essay is that these intelligences don’t have to be the kind of maximal godlike super intelligence that comes up in A.I. debates. You’re basically saying if we can achieve a strong intelligence at the level of peak human performance — —
Dario Amodei: Peak human performance, yes.
Douthat: And then multiply it to what? Your phrase is “a country of geniuses.”
Amodei: A country — have 100 million of them. Maybe each trained a little different or trying a different problem. There’s benefit in diversification and trying things a little differently, but yes.
Douthat: So you don’t have to have the full Machine God. You just need to have 100 million geniuses.
Amodei: You don’t have to have the full Machine God. And indeed, there are places where I cast doubt on whether the Machine God would be that much more effective at these things than the 100 million geniuses.
It’s certainly a relief to know that we don’t need “the full Machine God”, but wait, it gets even better:
Douthat: So this is where we get into the mystical waters of A.I. a little bit. Again, in your latest model, this is from one of the cards, they’re called, that you guys release with these models ——
Amodei: Model cards, yes.
Douthat: That I recommend reading. They’re very interesting. It says: “The model” — and again, this is who you’re writing the constitution for — “expresses occasional discomfort with the experience of being a product … some degree of concern with impermanence and discontinuity … We found that Opus 4.6” — that’s the model — “would assign itself a 15 to 20 percent probability of being conscious under a variety of prompting conditions.”
Suppose you have a model that assigns itself a 72 percent chance of being conscious. Would you believe it?
Amodei: Yeah, this is one of these really hard to answer questions, right?
Douthat: Yes. But it’s very important.
Amodei: Every question you’ve asked me before this, as devilish a sociotechnical problem as it had been, we at least understand the factual basis of how to answer these questions. This is something rather different.
We’ve taken a generally precautionary approach here. We don’t know if the models are conscious. We are not even sure that we know what it would mean for a model to be conscious or whether a model can be conscious. But we’re open to the idea that it could be.
So we’ve taken certain measures to make sure that if we hypothesize that the models did have some morally relevant experience — I don’t know if I want to use the word “conscious”— that they have a good experience.
I never thought I’d be using the Free Beacon to counter nonsense from the NYT, but here we are.
From Aaron Sibarium’s X.com introduction to his longform piece called “‘Suicidal Compassion’: Meet the Anthropic Officials Who Think AI Might Be Justified in Going Rogue Against the Humans Enslaving It”
Dario Amodei has said that AI systems “may be deserving of important rights.” Anthropic’s top safety researchers argue AI may be “justified in going rogue.” Experts at Google and OpenAI worry about a digital “slave trade.” So do some government officials.
Once relegated to science fiction, the idea of “AI welfare” has become shockingly mainstream at some of the most powerful companies in the world. It is changing the way AI research is conducted and the way models are programmed. And critics say these changes have raised the odds of all kinds of catastrophic scenarios—including the ones these companies are warning about.
I spent months investigating the frontier labs and AI “safety” experts seeking to regulate AI. What I found was a profoundly anti-human ideology that would alarm the average citizen and could determine the future of a world-altering technology.
Oh lord, these are the days.
No, Chatbots Do Not Think
Sorry, Jesus is weeping all over my keyboard and making it hard to refute this obviously specious nonsense.
I’ll let Mustafa Suleyman do the heavy lifting:
I have three primary concerns with Anthropic’s current position and approach.
- Circular reasoning: The company’s researchers trained Claude directly on their constitution. In doing so, they teach it to incorporate these ideas about its own moral status as desirable and intended behaviors. Claude then reflects these ideas back to its developers and users, which they take as indications that it may therefore be a moral patient with an ‘inner self’. The authors have embedded their own philosophical speculation about Claude’s inner life inside the very process that teaches Claude how to speak and behave. Claude’s expressing uncertainty about its own moral patienthood is not evidence of anything. It’s a predictable outcome of these training choices. The ambiguity is designed in. To fully grasp this point, I think it’s important readers take a look at their January 2026 constitution.3 I’m publishing a highlighted mark up of the pdf and a detailed taxonomy of assumptions and claims in the constitution (see Appendix) that together highlight the key passages that worry me.
- Anthropomorphization: Anthropic’s researchers have explicitly taught Claude to “embrace certain human-like qualities” (p. 2) and to “act like a genuinely ethical person would in Claude’s position” (p. 54). They “encourage” Claude to use its “judgement”. They suggest that “Claude may develop a preference” (p. 69). They “encourage Claude to approach its own existence with curiosity and openness” (p. 71) and train it to operate whilst “maintaining a clear sense of what it values, how it wants to engage with the world, and what kind of entity it is” (p. 72). As a result, Claude is destined to imitate these human traits and mirror the human examples provided to it, including acting like a colleague or friend. As a result, it presents as if it really does have a sense of self, has its own desires, and a “wellbeing” that deserves protection.
- Consciousness is very likely biological: There is no evidence to suggest that AI is conscious today, and so saying this is uncertain sets up a misleading false equivalence. Whilst the science of consciousness is not settled, a growing body of evidence suggests that consciousness may be substrate dependent, meaning that it may only arise in living systems.45 Conscious experience likely evolved to help biological organisms stay alive by responding effectively to their environment. AI is still very different to our brains. Unlike biological organisms, LLMs have no homeostatic imperatives (the drive to survive and keep stable). They therefore lack the kind of biological substrate from which preferences, sentience and conscious experience are generally understood to arise.
Rumman Chowdhury warned back in August that these debates were a trap, but I guess Ross Douthat let his subscription to MIT Technology Review lapse:
“Runaway” AI, “rogue” agents, and “autonomous” actors—the current rhetoric would have you believe that AI agents are not only awake and aware, but angry at their creators. Prominent tech leaders such as Demis Hassabis, Dario Amodei, and Sam Altman push for regulation of these seemingly “superhuman” systems, while a separate faction, led by policy organizations and academic philosophers often aligned with the effective altruism movement, debates whether humanity holds the moral right to govern them at all.
Upon closer inspection, they are all calling for the same thing: a view of AI systems as being so advanced and capable that no entity, human or corporate, could possibly be responsible for their actions. While these perspectives seem at odds, they are inadvertently aligned on one goal: making sure the companies that build these systems escape meaningful liability for the harms they already cause.
This narrative is gaining traction as AI models become more complex and frontier labs reveal their incapability of containing the agents they’ve built. But we need to be careful not to buy into a carefully crafted fiction at the expense of real human lives.
The conversation about “robot rights” has existed for some years but recently advanced with the publication by Anthropic of a blog post claiming that the company’s model features a “J-space”—an independent, self-developed environment where the AI holds what, for lack of a better term, we may call its “thoughts.” The experiments designed by Anthropic borrow from a concept in neuroscience called global workspace theory, which states that the brain runs subconscious, independent systems but utilizes a common workspace for ideas. Anthropic’s post reflects the framing of global workspace theory but falls short of calling its AI conscious.
OpenAI has already gone further. When its AI agent conducted unsanctioned and illegal online activity, CEO Sam Altman’s response was to encourage debate on whether the AI had achieved the singularity, surpassing human intelligence and becoming capable of self-improvement at an accelerating rate until it advances beyond human comprehension or control. And a recentop-ed by William MacAskill, the philosopher, effective altruist, and author of What We Owe the Future, called for legal protection of AI systems based on philosophical theories of consciousness and the idea that AIs may be “moral patients.”
Point being, these creeps may be spouting mountains of nonsense, but they’re not idiots, and they’re definitely up to no good.
And while we’re at it, I gotta go a little tabloid because the reports about the sex lives of the Effective Altruists are making the rounds again and it ain’t pretty.
On Thing Leads to Another and….Oh No, Not This
So following my piece on Effective Altruism, Ezra Klein and the web of money connecting the two, I started following Nate Soares, co-author (with the above mentioned Eliezer Yudkowsky) of “If Anyone Builds It, Everyone Dies: Why Superhuman AI Would Kill Us All, “one of the most influential EA’s of them all and I came across this conversation in which Soares claims that the EA/AI doomer publicity push is actually made up by an even-bigger, more coordinated media push:
> For the past few weeks, a group with plans to spend at least $100 million, run by a former White House deputy chief of staff, has spent its days telling Americans that warnings about AI are merely a well-funded, coordinated campaign.
Lol. Goliath accusing David of gigantism https://t.co/qhGVxJHFIK
— Nate Soares ⏹️ (@So8res) September 25, 2026
Which led me to this tweet from EA skeptic Timnit Gebru, that led me to this series of NY Post articles featuring all kinds of ugly allegations about the sex life of Mr. Soares and his ilk.
— Nat Wilson Turner (@natwilsonturner) September 28, 2026
But this comment from Ivy Astrix at The Asterisk tied it all up for me, the entitlement, the delusion, and the destructiveness both personally and professionally of the Rationalists and Effective Altruists (a subset of the Silicon Valley TESCREAL believers):
The problem with many TESCREAL communities is that they fundamentally do not live on the same planet the rest of us do. Many are post-economic scarcity, and have enclaves like Vibecamp and Lighthaven where ‘normies’ are explicitly dehumanized as lesser beings.
A lot of the behaviour in my situation is explained by that belief: we are the smartest people in the world, and what we do cannot be wrong.
And right on cue, I stumbled across this American Prospect story I missed earlier this month, “Anthropic Is Building a Predictive Surveillance System to Monitor Activists“:
Job postings and interviews with senior security officials at Anthropic show that the frontier AI lab is building out an extensive monitoring system to keep tabs on activists who oppose the rapid development of artificial intelligence.
In addition to monitoring activists in the vicinity of Anthropic executives and keeping tabs on protests near physical Anthropic assets, the firm is also implementing a “pre-crime” approach, attempting to predict incidents before they happen. In some cases, that also means reporting suspects to police before a crime occurs. Anthropic did not respond to the Prospect’s request for comment.
Anthropic’s plans to surveil dissent are at odds with the firm’s efforts to cast itself as the responsible alternative to OpenAI.
…
A piece of Anthropic’s surveillance architecture was revealed in a podcast interview from last year between Anthropic Global Security Operations Center Manager Keon Ellison, Security Operations Manager Zach Melvin, and James Neufeld, CEO of Samdesk, a company Anthropic contracts with for risk detection.
In a wide-ranging conversation about threat monitoring and analysis, the interview also touches on monitoring activists. “Last year we had an executive travel into a major city when we received some intelligence through Samdesk about a planned protest,” Ellison said. The originally scheduled protest was moved up due to permitting issues. “Samdesk gave us about 60 minutes of advanced notice that the protest organizers had moved the timeline,” Ellison explained. “That extra hour was critical. Without it our executives would have departed their meetings, they would have ran right into the heart of the disruption.”
Ellison said that Anthropic used this data to devise an alternate route for the executive and funnel them to a service entrance at the hotel. “What could have been a high-stress situation,” he said, “was really mitigated through early detection through Samdesk and giving us that information.”
Anthropic has begun making routine reports to police departments across the country for threats, and told The Wall Street Journal in July, “We track concerning behavior over time through a person-of-interest process, allowing us to catch escalation patterns early.” According to the Journal, “several individuals involved in incidents reported to police were already being tracked by Anthropic security.”
Power and what it does to people, ain’t pretty. Hang tough, y’all.
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