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May 7, 2019

Axios Future

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Any stories we should be chasing? Hit reply to this email or message me at steve@axios.com. Kaveh Waddell is at kaveh@axios.com and Erica Pandey at erica@axios.com.

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1 big thing: Avoiding the AI weapons race

Illustration: Sarah Grillo/Axios

Today's great powers are sliding toward a new arms race, this time on the battleground of lethal computer code, but experts say that rushing to develop autonomous weapons — which can be erratic and easily stolen — will make violent conflict more likely and yield no winners.

Kaveh writes: The countries leading in artificial intelligence research (U.S., China, Russia, U.K., France, Israel and South Korea) are all developing weapons that hand off increasing portions of the killing process to computers.

In a new report coming out tomorrow and reported first by Axios, PAX, a Dutch nonprofit, describes "clear signs of the start of an AI arms race."

  • "Automated turrets" guard South Korea's border, choosing targets autonomously but requiring a human go-ahead before they fire, says PAX, which lobbies companies not to make lethal AI.
  • China sells stealth drones advertised to be capable of autonomous airstrikes.
  • Israel uses autonomous drones to patrol its border with Gaza.

Unlike nuclear weapons, which can be guarded in bunkers and require deep expertise to manufacture, autonomous weapons are not easily locked away. "Once you develop them, these weapons will proliferate widely," Daan Kayser, the PAX report's lead author, tells Axios. "They'll also be used against you."

The reflex to treat AI as an arms race is creating a self-fulfilling prophecy, Paul Scharre, an autonomous weapons expert at the Center for a New American Security, warns in Foreign Affairs. In a security dilemma that resembles the Cold War, as countries build up their defenses, the world becomes more dangerous.

  • "There are strong institutional incentives within national security bureaucracies to stay ahead of others," Scharre tells Axios. But chasing breakneck speed can push aside essential research into AI safety and cybersecurity.
  • That could result in AI weapons that aren't thoroughly tested, make inexplicable decisions in the heat of the moment, or interact in unforeseen ways with other systems. "Some of the most powerful [AI] methods are quite alien to human intelligence," Scharre said.

But, but, but: The phrase "arms race" conjures images of the Cuban Missile Crisis, while a bigger conflict is likely to play out on the economic battlefield, says Amy Webb, an NYU professor and founder of the Future Today Institute.

  • "When we talk about an arms race, we tend to think about the wars that have already been fought," Webb tells Axios. "We're never talking about the wars of the future."
  • Autonomous weapons are one small slice of next-generation conflict, she says. The greater threat: a Chinese economy made hyper-efficient by AI and backed by allied emerging economies that could "cripple" U.S. markets.

What's next: The U.S., unlike most countries, has a clear-cut policy against using weapons that target and kill people without any human input.

  • But it has blocked attempts at the United Nations to establish a global ban on fully automated weapons and continues to develop increasingly autonomous fighting machines that still ask for a soldier's go-ahead before shooting.
  • Later this year, a group of outside advisers called the Defense Innovation Board will recommend a set of ethical "AI principles" to the Pentagon.
2. A wrinkle in the trade war

Xi Jinping, in Beijing, April 30. Photo: Andrea Verdelli/Getty

For Beijing, this is not 2018: After a year of unwinding problematic debt and leaning in to its transformation to a service economy, China is enjoying a manufacturing and economic rebound.

Axios markets editor Dion Rabouin writes: While the Trump administration amps up its trade rhetoric, China, unlike its more sickly condition last year, is suddenly more important to global economic health than the U.S.

  • It's the top trading partner to more countries and, with emerging markets driving 60% of global GDP expansion, is the engine powering the world's growth.

Driving the news: Chinese shares closed up today after yesterday's plunge following new threats from the U.S. It shows that investors perhaps aren't quite ready to declare China's economy DOA despite the shouting from the White House.

The bottom line: The world needs China.

  • The eurozone looks to be recovering, but it is still projecting just 1.1% growth this year. Italy just came out of recession, Sweden and Germany narrowly avoided one in 2018, and Britain is a hard Brexit away from possible economic catastrophe.
  • South America's largest economies — Brazil, Colombia and Mexico in North America — have seen some improvement in manufacturing data but are treading water, with Argentina lurching toward another economic crisis.
  • Africa's 2 largest economies, South Africa and Nigeria, are sputtering, and Australia is fighting to avoid its first recession in almost 30 years.

Go deeper: The trade war isn't breaking China's economy

3. Today's surprising stat: Vacant houses

Vacant houses in Newburgh, New York. Photo: Don Emmert/AFP/Getty

Japan's aging trend is swelling the number of vacant houses in the country: There were 3.47 million vacant private homes in Japan last year, up 9.1% since 2013. That's 5.5% of the total number of houses, according to Tomohiro Ebuchi and Shohei Nomoto of Nikkei.

That's a lot, but the surge of housing vacancies — for varying reasons — is a global trend.

In the U.S.:

  • The number of vacant homes that seemingly nobody wants to rent, sell or move into rose to 5.8 million in 2016, up 56% from 2005, according to a report by Alan Mallach of the Lincoln Institute of Land Policy. The number soared in the financial crash, and is still high.

In China:

  • As with almost everything economic, China's numbers are quite large by comparison (China only has numbers for total housing including apartments) — 22% of the country's urban stock of apartments and houses are empty, equaling some 50 million homes and apartments, according to a November piece in Bloomberg. For reference, one report, discussing blight in large U.S. cities, calls anything above 20% "hypervacancy."
4. Worthy of your time

Sumatran orangutan, Suaq Balimbing, Indonesia. Photo: Chaideer Mahyuddin/AFP/Getty

What Americans want delivered: Pizza (Andrew Chen — a16z) (h/t Azeem Azhar)

1 million species at risk of extinction (Andrew Freedman — Axios)

We are eating more meat (The Economist)

Dementia-friendly cities (Sue Sveum — CityLab)

What happens to abandoned malls? (James Fallows — The Atlantic)

5. 1 fun thing: Two scenes from Queens

A 2016 Uber protest (left); the Citi building in Long Island City (right). Photos: Getty; Erica Pandey/Axios

Yesterday our top two stories chronicled the Amazon effect in Long Island City, Queens, and a wave of Uber and Lyft protests. These two stories have more in common than we thought.

Erica writes: An observant reader emailed to let us know that the photo we used in our ride-hailing story (see above) was taken in Long Island City as well. It's an image of a 2016 protest against low wages for Uber drivers outside the company's first NYC office, which was on Jackson Avenue in Queens.

Looks like Amazon was not the first tech titan to get interested in Long Island City.