Comment by dkural

Comment by dkural 17 hours ago

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[ This comment I'm making is USA centric. ]. I agree with the idea of making our society better and more equitable - reducing homelessness, hunger, poverty, especially for our children. However, I think redirecting this to AI datacenter spending is a red-herring, here's why I think this: As a society we give a significant portion of our surplus to government. We then vote on what the government should spend this on. AI datacenter spending is massive, but if you add it all up, it doesn't cover half of a years worth of government spending. We need to change our politics to redirect taxation and spending to achieve a better society. Having a private healthcare system that spends twice the amount for the poorest results in the developed world is a policy choice. Spending more than the rest of the world combined on the military is a policy choice. Not increasing minimum wage so at least everyone with a full time job can afford a home is a policy job (google "working homelessness). VC is a teeny tiny part of the economy. All of tech is only about 6% of the global economy.

limagnolia 15 hours ago

You can increase min wage all you want, if there aren't enough homes in an area for everyone who works full time in that area to have one, you will still have folks who work full time who don't have one. In fact, increasing min wage too much will exacerbate the problem by making it more expensive to build more (and maintain those that exist). Though at some point, it will fix the problem too, because everyone will move and then there will be plenty of homes for anyone who wants one.

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  • dkural 15 hours ago

    I agree with you 100%! Any additional surplus will be extracted as rents, when housing is restricted. I am for passing laws that make it much easier for people to obtain permits to build housing where there is demand. Too much of residential zoning is single-family housing. Texas does a better job at not restricting housing than California, for example. Many towns vote blue, talk to talk, but do not walk the walk.

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jkubicek 17 hours ago

> AI datacenter spending is massive, but if you add it all up, it doesn't cover half of a years worth of government spending.

I didn't check your math here, but if that's true, AI datacenter spending is a few orders of magnitude larger than I assumed. "massive" doesn't even begin to describe it

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  • atmavatar 16 hours ago

    The US federal budget in 2024 had outlays of 6.8 trillion dollars [1].

    nVidia's current market cap (nearly all AI investment) is currently 4.4 trillion dollars [2][3].

    While that's hardly an exact or exhaustive accounting of AI spending, I believe it does demonstrate that AI investment is clearly in the same order of magnitude as government spending, and it wouldn't surprise me if it's actually surpassed government spending for a full year, let alone half of one.

    1. https://www.cbo.gov/publication/61181

    2. https://www.google.com/finance/quote/NVDA:NASDAQ

    3. https://www.cnbc.com/2025/09/30/nvidias-market-cap-tops-4poi...

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    • diziet 14 hours ago

      > NVIDIA's total annual revenue for its fiscal year 2025 (ended January 26, 2025) was $130.5 billion

      It is clearly not in the same order of magnitude

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  • dkural 15 hours ago

    Global datacenter spending across all categories (ML + everything else) is roughly 0.9 - 1.2 trillion dollars for the last three years combined, I was initially going to go for "quarter of the federal budget", but picked something I thought was more conservative to account for announced spending and 2025 etc. I pick 2022 onward for the LLM wave. In reality, solely ML driven, actual realized-to-date spending is probably about 5% of the federal budget. The big announcements will spread out over the next several years in build-out. Nonetheless, it's large enough to drive GDP growth a meaningful amount. Not large enough that redirecting it elsewhere will solve our societal problems.

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kipchak 15 hours ago

>We need to change our politics to redirect taxation and spending to achieve a better society.

Unfortunately, I'm not sure there's much on the pie chart to redirect percentage wise. About 60% goes to non-discretionary programs like Social Security and Medicaid, and 13% is interest expense. While "non-discretionary" programs can potentially be cut, doing so is politically toxic and arguably counter to the goal of a better society.

Of the remaining discretionary portion half is programs like veterans benefits, transportation, education, income security and health (in order of size), and half military.

FY2025 spending in total was 3% over FY2024, with interest expense, social security and medicare having made up most of the increase ($249 billion)[1], and likely will for the foreseeable future[2] in part due to how many baby boomers are entering retirement years.

Assuming you cut military spending in half you'd free up only about 6% of federal spending. Moving the needle more than this requires either cutting programs and benefits, improving efficiency of existing spend (like for healthcare) or raising more revenue via taxes or inflation. All of this is potentially possible, but the path of least resistance is probably inflation.

[1] https://bipartisanpolicy.org/report/deficit-tracker/

[2] https://www.crfb.org/blogs/interest-social-security-and-heal...

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  • dkural 14 hours ago

    I agree with all of what you're saying.

    I think the biggest lever is completely overhauling healthcare. The USA is very inefficient, and for subpar outcomes. In practice, the federal government already pays for the neediest of patients - the elderly, the at-risk children, the poor, and veterans. Whereas insurance rakes in profits from the healthiest working age people. Given aging, and the impossibility of growing faster than the GDP forever, we'll have to deal with this sooner or later. Drug spending, often the boogeyman, is less than 7% of the overall healthcare budget.

    There is massive waste in our military spending due to the pork-barrel nature of many contracts. That'd be second big bucket I'd reform.

    I think you're also right that inflation will ultimately take care of the budget deficit. The trick is to avoid hyperinflation and punitive interest rates that usually come along for the ride.

    I would also encourage migration of highly skilled workers to help pay for an aging population of boomers. Let's increase our taxpayer base!

    I am for higher rates of taxation on capital gains over $1.5M or so, that'll also help avoid a stock market bubble to some extent. One can close various loopholes while at it.

    I am mostly arguing for policy changes to redistribute more equitably. I would make the "charity" status of college commensurate with the amount of financial aid given to students and the absolute cost of tuition for example., for example. I am against student loan forgiveness for various reasons - it's out of topic for this thread but happy to expand if interested.

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