»In almost every enterprise, government has provided business with opportunities for private gain at public expense. Government nurtures private capital accumulation through a process of subsidies, supports, and deficit spending and an increasingly inequitable tax system. From ranchers to resort owners, from brokers to bankers, from auto makers to missile makers[, from high-tech venture capitalists to technofeudalists], there prevails a welfare for the rich of such magnitude as to make us marvel at the corporate leaders audacity in preaching the virtues of self-reliance whenever lesser forms of public assistance threaten to reach hands other than their own.« — Michael Parenti

Massive data centers utilised to train and deploy »Artificial Intelligence« (AI) models used for inference and generative AI tasks require substantial capital investment motivated by the potential to act as a considerable source of profit. To illustrate just how much capital is at stake, »The Stargate Project« — ¹ a joint venture created by OpenAI, SoftBank, Oracle, and the investment firm MGX, ^{2 3} officially announced by Donald J. Trump in a White House press conference on January 21. 2025 — serves as a contemporary example. Stargate LLC — the legal entity backing the »Stargate Project« — plans on investing up to $500 billion in AI infrastructure in the United States by 2029, beginning to deploy $100 billion immediately. Because of its large scale, the Stargate program has been compared to the Manhattan Project, a gargantuan research and development program led by the US, undertaken during World War II to produce the first nuclear weapons.^{4 5 6 7} More recently, U.S. big tech’s AI capital efforts to expand its data center infrastructure ownership — underwritten by massive public subsidies — turn out to exceed »the railroad expansion of the 1850s, the Apollo space program that put astronauts on the moon in the 1960s and the decadeslong build-out of the U.S. interstate highway system that ended in the 1970s.« ⁸

Across the Atlantic, the »European approach to AI«, triggered by the announcement of the U.S. »Stargate Project«, aims »to mobilise a total of €200 billion in AI investments« under the “InvestAI initiative” “spearheaded [by US] venture capital firm General Catalyst. The »InvestAI« initiative has drawn pledges of €150 billion of private investment so far, from the likes of Airbus, ASML, Siemens, Infineon, Philips, Mistral and Volkswagen,” topped up by €50 billion bankrolled by the EU, including €20 billion for AI “gigafactories.” ⁹ A “sense of urgency” to invest in AI is promoted ad-nauseam by the president of the EU commission, Ursula von der Leyen, solemnly declaring Europe as »a continent that puts AI first« in front of business leaders. Venture capital is attracted via measures aimed to “adjust regulatory risk premiums”, ¹⁰ tax credits and exemptions, infrastructure investments in the form of directly financing the building of data-centres, and straight up subsidies via development funds and grants “which do not have to be repaid by companies.” The price tag for “technological freedom” will be measured in GPUs, and “access to computing power will be as essential as coal was in the 19th century,” according to analysts. ¹⁰ Environmental implications of AI, in particular its carbon footprint and water consumption, are typically brushed aside as “difficult to pin down, let alone mitigate.” ¹¹

The risk of “becoming [too] technologically dependent on the US and China” is commonly cited by EU officials to justify massive public spending to bring about “an inevitable economic transformation” towards a projected future where “AI and large language models (LLMs) will become ubiquitous in all sectors,” ranging from industry, services, healthcare, finance, and education. While the “technological dependence on the US” is “replaced” by a financial dependence on its venture capital corporations (i.e., General Catalyst is headquartered in the U.S.), it is the “ubiquitous” and universal nature of the potential applicability of AI that explains the capital spending frenzy, as such »disruptions« are the source of considerable profits. Compared to other highly profitable industries such as the defence and pharmaceutical industries, AI doesn’t require complex geopolitical machinations and investments to maintain the spectre of official enemies for the former; nor does it require artificially caused global health emergencies (i.e., pandemics) and the »[treatment of] medical care not as a human right but as a market-determined profit-driven service,« ¹² for the latter. The high-tech AI industry doesn’t depend on, yet caters to, all of the above and many more segments of industry, education, and governance in its promise as a key disruptive technology, if only a large enough segment of the population can be driven into its dependence.

Another worrying aspect of the enforced “AI transformation” is its primary justification. For the most part it consists of vague platitudes of a better world in the distant future:

»All of us look forward to continuing to build and develop AI […] for the benefit of all humanity. We believe that this new step […] will enable creative people to figure out how to use AI to elevate humanity.« — OpenAI Statement released at the launch of the »Stargate Project«

This press statement by OpenAI is particularly cunning as it is using a circular argument, namely that AI is required to figure out how to use AI to “elevate humanity,” to justify astronomical AI spending. En passant, it is quite perverse and intellectually reckless to assert what something is for without first establishing what that something, namely AI, actually is, and second, what its purpose, namely to “elevate humanity,” entails. This level of “corporate bullshit [delivered in] a specific style of communication that uses confusing, abstract buzzwords in a functionally misleading way […] sounds impressive, but it is semantically empty” ¹³ and vacuous, yet sufficient to justify astonishing subsidies.

Nevertheless, “the excitement surrounding potential benefits of generative AI, from improving worker productivity to advancing scientific research, is hard to ignore” (emphasis mine) according to a MIT News article. ¹¹ It just fails to point out who is “excited” about the “potential benefits” of AI, as it is not the employees “at companies big and small” for whom “the boss has a message: use AI or your’re fired,” as the Wall Street Journal put it in an article observing that the new fear is not “being replaced by AI” but “being replaced by someone who knows AI.” ¹⁴ It is also argued that AI »infrastructure will secure American leadership in AI [and] create hundreds of thousands of American jobs.« However, a recent study by CNBC found that »a singular Microsoft data center in Illinois only created 20 permanent jobs, despite receiving $38 million in sales tax exemptions." In other words, »data centers do not need a large workforce and therefore have not contributed to significant job growth, have incredibly short life spans, and have been associated with cases of harmful air pollutants including nitrous oxides.« ¹⁵

Wall Street commonly refers to AI as a “disruptive” technology. ^{16 17} As such, the concentration of means required to train, engineer, and deploy AI models and the fact that these means are in the hands of the few who can afford large capital investments (total project costs for large AI data centre facilities exceed $2 billion), coupled with the need to valorize that investment and realize an ongoing profit by de-skilling employees, often highly educated ones (i.e., software engineers), divesting them of their tools and skills, transforming them into dependent consumers of a monopoly service, is a “rational” strategy towards the maximisation of profits, i.e., rational choices in a lunatic framework. Taking it one step further, a “conflict over technology” within the segment of information technology itself, could also be viewed as a conflict over class relations, an encapsulation of embryonic capitalism, ¹⁸ judging by mass layoffs ^{19 20 21} sold under the rubric of »embracing AI«, a phenomenal corporate propaganda construct.

In this context it is useful to recall that the high-tech sector is for the most part a capitalist (i.e., venture capitalist) system. What that means is that the investment, the engineering, the resources, the capital, the technology, all these things are used for the purpose of accumulating capital (i.e., profit). The goal of high-tech venture capitalism is not to create jobs. In fact, capitalists in the high-tech sector pride themselves that they will eliminate jobs, if they can (i.e., to improve »operating margins« and »foster growth«). Nor is the purpose of capitalism to build communities of users and customers. Capitalism will build or destroy real and virtual communities as investment opportunities dictate. Nor is it the purpose to create a better life and a better environment for the generations yet to come. Capitalism and high-tech corporations will use the environment as a septic tank, if it serves their profit purposes, and they won’t even help the generation that’s struggling with it right now, let alone the ones to come. Nor is the purpose of capitalism to create efficiency and avoid waste, because capitalism constantly pours its inefficiencies and diseconomies onto the public and into the public realm in the form of unemployment, injuries, unsafe products, pollution, and things of that sort. ²²

High-tech capitalism has no loyalty to nation or to flag or to democracy or, for that matter, to autocracy or to God or to atheism or to any of those isms or any of those things. It has no loyalty to family. There is no social force in human history to compare to capitalism when it comes to the destruction of traditional values. It is a remarkably rational system. That’s what it’s there for. It has no sentiment in it and in its imperatives. All things, all people, all commodities, all values are reduced to instrumental objects to serve this end purpose, which is to make money in order to invest it to make more money to invest it to make more money to invest it to make more money. The function is to accumulate capital. Accumulate, accumulate, accumulate, driving on endlessly. ²² It is not to make useful or user friendly software. It is not to make safe software. It’s to make money. If a high-tech venture capitalist can make awful yet cheap software that generates »AI slop«, that will make him more money, he will do it that way.

It is remarkable that the current AI “revolution” ²³ and its effect on society are hardly ever reviewed from this point of view, in particular as this analytical framework leads to a level of clarity and understanding that explains many of the apparent irrationalities and incoherencies permeating the high-tech industry.

Note

The analytical framework employed in this article has been influenced on talks and books by Michael Parenti, who recently passed away (January 24, 2026).