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We all know the famous saying by now; the United States innovates; China duplicates and the European Union regulates. This is of course somewhat of a simplified way of looking at things, but the ensuing AI cold war might prove this saying to be not only true, but to have huge economical and politically disastrous consequences for Europe.
Enter tech bros
The AI cold war has already begun in a sense. In the wake of the immensely popular AI work tools, such as Open AI’s ChatGPT, the world witnessed something of a new technological evolution. With the use of AI, suddenly everything from making grocery lists to writing essays (however ill-advised!) became much easier and accessible for consumers. AI thus became all the rage, and now, most big tech companies are trying to ensure their place in the ever more expanding and innovative AI market.
What you also see is the emergence of the so called “tech bros”, a somewhat non flattering collocative for the innovators, engineers and entrepreneurs who are spearheading AI evolution. The tech bros are unique in a sense that they tend to be more right-wing libertarian than previous wave of tech geeks, who have more commonly leaned to the left, which the discourse moderation on social media that has favoured certain perspectives above others bears witness to.
At the same time, the European Union has made its own contribution to the AI boom, and as always, the answer was more regulations and more restrictions. The so-called Artificial Intelligence Act from 2024 aims to regulate the usage of AI depending on a 4-level scale of risk and harm. This might not sound bad, it might even sound good that the EU is in its own way protecting its citizens from potential abuses that governments are capable of with the power of AI.
A deep crash
The shock waves created by the introduction of the chinese company Deep Seek cannot be underestimated. For starters, On Monday 27th of January, Nvidia’s stock price fell by 17 percent after DeepSeek, a Chinese AI company, announced a significant breakthrough in AI efficiency. The drop equated to a loss of approximately $589 billion in market value.
This shows us mainly two things. First and foremost, that whoever leads the AI race will dominate the market and tech in every sense of the word. But also, how deeply entrenched the West is in the economic war with China.
During his first week as president, Donald J Trump announced the Stargate project at the White House alongside Softbank CEO Masayoshi Son, OpenAI’s Sam Altman and Oracle co-founder Larry Ellison. This initiative stands in stark contrast to both the Biden administration’s as well as the EU’s attempt to regulate AI companies.
Instead, Trump is seemingly more tolerant of the tech bros, providing the fact that they deliver on the promises of improving the economy and national security. If successful, the USA might be able to fully harness the power of AI and usher in a new era of “re-industrializing” the United States.
This is good and all for the United States, but what does this mean for the European Union? It might be too soon to tell, but Trump has already strongly indicated that tariffs against the EU might be on the negotiation table if the EU continues to restrict the AI companies. Apart from the obvious economic toll it would put on the EU, it would also mean that the EU will miss out on participating in the new AI cold war. It should be noted that the EU has plans on developing its own AI, called “Open Euro”.
Could this Open Euro compete with the bold and brash American AI initiatives? Perhaps, but if the current trend of EU stagnation, lack of imagination, and to top it off, restrictions on AI continues, it is safe to say the EU will not only fall behind, but fall completely out of relevance as a power player.
What we are seeing is a new space race, or you could even call it a new cold war. It is very hard to tell which superpower is leading the AI race, but one thing is clear – it is not the EU.
Ursula von der Leyen might have the “compass”, but Trump has the ship, and it is not stopping any time soon.