FROLITICKS

Satirical commentary on Canadian and American current political issues

Oct 31

When Will the High Tech Stock Market Surge Slow Down?

by bcurry

Here are a couple of interesting stats about American high tech companies.  Market concentration has never been greater than in past decades, as the one created by Artificial Intelligence (A.I.).  According to senior index analysts for S&P Dow Jones Indices, Nvidia alone, which makes A.I. chips, makes up more than 8 percent of the S&P 500.  Nvidia is now worth $5 trillion as it continues to consolidate power in A.I. boom.  Apple and Microsoft now top $4 trillion. Those companies combined with Meta, Amazon, Alphabet and Tesla make up more than a third of the entire index.  According to Harvard’s economic faculty, spending on data centers, which are filled with the Nvidia chips, accounted for 92 percent of the country’s gross domestic product (G.D.P.) growth in the first half of 2025.  Chip technology is a powerful technology that can be used to develop advanced weaponry and drive economic opportunity.  Companies like Microsoft and the software company Oracle are pouring hundreds of billions of dollars into building data centers for A.I.

Now the question becomes: “What is the high tech impact on main street versus wall street?”  Most analysts are concerned particularly about the impact of current and future A.I. investments on the labour market for example.  While the current situation continues to produce more millionaires and billionaires, there is already evidence that companies are looking at ways of reducing labour costs through A.I. and A.I. assisted robotics.  For example, it concerns me that Amazon has been aggressively looking to do more with less.  It also concerns me that Amazon recently announced that it was laying off 14,000 corporate employees partly due to its use of A.I.  It is further reported that Amazon spent more than $34 billion on capital expenditures in the third quarter of this year, in large part to set up data centers that power cloud computing and A.I.  It should be noted that the company’s sales totalled $180.2 billion from July through September of 2025, up 13 percent from the same time in 2024.  Profit was $21.2 billion, up a whopping 38 percent.  Furthermore, as an obvious future cost cutting initiative, the New York Times reported that Amazon’s automation team has ambitious goals to use robotics to avoid hiring more than half a million workers by 2033.

Apple’s iPhones are fuelling record sales and profit so far this year, despite raising prices on its latest iPhone and having largely avoided the A.I. arms race.  However, the company still accounts for about 6 percent of the S&P 500 index.  While Apple is not pouring billions of dollars into data centers, developing expensive A.I. systems or building its own chatbot, the company continues to collect payments from Google.  Apple also charges A.I. companies to reach iPhone customers.  Most importantly, instead of bringing its manufacturing home to the U.S., Apple shifted some production from China to India, Vietnam and Thailand.  Almost nothing is made in America, and an estimated 80 percent of iPhones are still made in China.

All said and done, some investors have questioned whether A.I. will actually increase productivity and sales.  This is the trillion dollar question given that the short-term returns have not been all that great in light of the billions of dollars of current investment capital.  Nevertheless, it’s clear that the stock markets are apparently very optimistic.  Only time will tell. 

In addition, there is still the expected negative impact on the labour market as evidenced by recently announced employee cutbacks by several high tech firms using A.I.  A.I., complemented by enhanced robotics, is seen as a tool that could replace people in many jobs, including those in white collar occupations. The jury is still out on this one.  Today, youth unemployment in North American is at its highest rate and recent college graduates in several fields, including in the computer sciences, are experiencing a great deal of difficulty in obtaining employment in their field of study.  Higher unemployment may be one of those areas on main street that would be the result of the potential direct impact of what’s happening on wall street.  Of course, the billionaires would argue otherwise.

Artificial Intelligence Artificial Intelligence Economy Labour Force US

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Feb 25

Trump Administration Halts Research Spending in the Health Field

by bcurry

As a recent article in the New York Times1 points out, by some measures, the U.S. produces more influential health-sciences research than the next 10 leading countries combined.  At risk are not only the tens of thousands of grants the National Institutes of Health (N.I.H) awards each year, but also American dominance of biomedical research.  The world’s leading medical labs can be found in the United States, and they rely heavily on grants from the N.I.H.  Billions of dollars are spent on research for diseases and health conditions such as cancer, Alzheimer’s, heart disease, brain injuries, child health, diabetes, H.I.V. infections and numerous other ailments.  The N.I.H notes that every dollar the agency spends on research generates more than two dollars in economic activity.  Why?  The results of medical research in the past have often led to the pharmaceutical industry developing drugs and vaccines for the treatment and prevention of diseases and health conditions, thereby fueling pharmaceutical advancements.  The result is also the fact that American companies will export many of the resulting drugs and vaccines to other countries, helping to grow the U.S. economy and positively lead to an American trade surplus.

Canadians and Americans have benefited from the medical research leading to pharmaceutical advancements.  Often, Canadian researchers will contribute to health-sciences research as was the case in the discovery of insulin years ago.  Today, there is on-going biomedical research at a number of Canada’s top universities.  Hopefully, researchers in both countries will continue to share in their findings.  The current U.S. administration’s handcuffing of its own scientists and holding back their important research will no doubt lead to serious consequences for advancements in the health field. 

The above mentioned New York Times article goes on to stipulate: “In response to all the uncertainty, universities are retrenching. The University of Pittsburgh froze Ph.D. admissions. Columbia University’s medical school paused hiring and spending. The Massachusetts Institute of Technology froze the hiring of non-faculty employees.”  In addition, some lab leaders indicated that they were making contingency plans to fire scientists, and that graduate students are being forced to search for new sources of funding.  I personally know of one young Canadian graduating from the University of Ottawa’s science faculty who a few years ago ended up in New York to participate in cancer research as part of a post-graduate program.

Much of biomedical research deals with not only areas related to treatments, but also areas related to the prevention of diseases, including those which particularly affect our aging population in both countries.  To hamper the work of such an important American institution as the National Institutes of Health is a major disservice to Americans and Canadians alike, and will have longer-term consequences.

1 “Paying for Science”: Benjamin Mueller, New York Times, February 25, 2025

Budget Canada Donald Trump Scientific Research US US.-Canada Relations

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Sep 25

How Will Countries Deal With Rising Issues Surrounding Artificial Intelligence?

by bcurry

More and more reports are surfacing based on how to deal with rising issues with respect to the evolution, if not revolution surrounding artificial intelligence (A.I.).  Alarmed by the power of A.I., Europe, the U.S., Canada and others are trying to respond — but the technology is evolving more rapidly than their policies.  As a result of an international safety summit held in November 2023 in the UK, the Bletchley Declaration was released by 29 countries attending the summit.  The declaration noted that: “Substantial risks may arise from potential intentional misuse or unintended issues of control relating to alignment with human intent.  These issues are in part because those capabilities are not fully understood and are therefore hard to predict.  We are especially concerned by such risks in domains such as cybersecurity and biotechnology, as well as where frontier A.I. systems may amplify risks such as disinformation.”  The summit also noted that the many risks arising from A.I. are inherently international in nature, and so are best addressed through international cooperation.  History suggests that this may be very difficult to achieve.

The examination of issues surrounding A.I. has been ongoing since the turn of this century.  Today, A.I. systems are already deployed across many domains of daily life including housing, employment, transport, education, health, accessibility, and justice.  Their use is likely to rapidly increase.  Everyone agrees that A.I. can have major benefits when employed in many sectors, helping humans to better deal with societal issues including those related to public services such as health and education, food security, in science, clean energy, biodiversity and the climate.

The most discussed A.I. issue is related to the potential loss of employment and displacement of existing jobs and their workers.  A 2016 study from the Organization for Economic Cooperation and Development estimateds that 9 percent of jobs would be completely displaced in the next two decades.  The authors noted that many more jobs will be transformed, if not eliminated.  Opposition over the use of A.I. has already surfaced in the entertainment industry, especially in the music and television/film sectors.  Last year, there was a major strike among American writers concerned over the use of A.I. in the industry, and many artists in the music business have also expressed similar concerns.  There apparently are no sectors where A.I. will not have a significant impact.  There are those supporters who argue that the technology simply represents another tool to assist workers in their daily work, and the displacement issues have been overrated and exaggerated.  I tend to disagree.

Governments however believe that, despite many unknowns, further investment in A.I. research and development is needed.  Like many new technologies, the approach will most likely involve incremental government legislation as the continuing use of A.I. unfolds.  This was the approach taken in response to past new technologies, including the arrival of the Internet and its accompanying new telecommunications and laser technologies.  Having personally seen the growth in the use of laser technologies in numerous sectors, I saw the introduction of regulations to address health and safety concerns for example.  Suddenly, laser technologies were employed in the health care sector, construction industry, semiconducting chip manufacturing, consumer electronics, information technology, science, law enforcement,  entertainment, and of course the military.  Fiber-optic communication using lasers is a key technology in modern communications, allowing services such as the Internet.  As the technology evolved, governments and standards associations in the U.S. and Canada introduced occupational health and safety requirements through regulation.  With each new development, regulations and standards were updated incrementally as required to protect those workers and consumers using laser technologies.

The general impression that one gets from reading recent reports on the impact of A.I. is that a similar incremental approach will be required in order to provide for the public’s protection and to deal with emerging issues.  This will be no easy task given the degree to which the private sector is advancing A.I. systems.  The fear is that there will be a lagging effect wherein governments will not be able to keep up with the projected rapid advances in A.I. and its uses.  This particular aspect is definitely the most important overall issue for societies today.

Artificial Intelligence

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