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The fiercest space race is not about getting back to the moonits about allowing you to post a TikTok or watch Netflix on your phone anywhere around the globe, from the Atacama Salt Flats to the Khongor sand dunes in the Gobi Desert. To make this happen, two distinct design philosophies are at war, as companies build out the infrastructure needed to ensure every phone on the planet is permanently connected to the internet. On one side is Elon Musks SpaceX/Starlink and the copycat companies that have followed in Starlinks wake. Their approach is to invade space with tens of thousands of small satellites, creating a network of objects that blanket low Earth orbit. On the other side is a small Texas-based company called AST SpaceMobile, which believes it can provide better service with fewer than 100 gigantic satellites in space. Both companiesalong with Amazon and a handful of Chinese organizationswant to dominate worldwide wireless communications. The satellite constellation with the fastest service, widest coverage, best compatibility with 5G cellphones, and lowest operational costs will own how we communicate for years to come. Which approach prevails will have serious impact not only on the future of the internet but also the health of our planet. A new space race era Musk set off a new space race with his desire to rule low Earth orbit. SpaceX, which owns Starlink, launched its first satellite in 2019, providing broadband internet access to anyone with a large Starlink antenna and modem on the ground. Since then, it has put more than 9,000 satellites into orbit. The company projects it will eventually have a constellation of 34,000 satellites. After Starlinks initial launch, competitors followed suit, including Jeff Bezos and his Project Kuipernow called Amazon Leoand the Chinese, whose plans include two large satellite constellations. But theres a fundamental problem with this mega-constellation design: Musks plan for space internet is a flawed, wasteful, and dangerous game of orbital Russian roulette. The crowded sky, a 30-minute exposure taken in June 2025 [Photo: Alan Dyer/VWPics/Universal Images Group/Getty Images] Scientists worry that Starlinks projected 34,000-satellite constellation will cause irreparable damage to the atmosphere. A large-scale constellation also dramatically increases the possibility of a space collision that could start a catastrophic chain reaction, destroying orbital networks that are crucial for our survival as a species. Jonathan McDowell, an astrophysicist and spaceflight historian at the Harvard-Smithsonian Center for Astrophysics, has been documenting satellite launches in his newsletter, Jonathan’s Space Report. He believes there may be other, better ways to achieve global coverage via satellitesif we need to be doing it at all. I do personally have a preference for smaller numbers of larger satellites, he tells Fast Company. One of the reasons is the risk of space collisions. If you have 10 times as many satellites, you have 100 times as many close misses. So from that point of view alone, consolidating on a smaller number of satellites seems wiser. A more efficient alternative Thats where Musks biggest competitor comes into play. AST SpaceMobile has developed a direct-to-cell technology that utilizes large satellites called BlueBirds. These machines use thousands of antennas to deliver broadband coverage directly to standard mobile phones, says the company’s president, Scott Wisniewski. This approach is remarkably efficient: We can achieve global coverage with approximately 90 satellites, not thousands or even tens of thousands required by other systems, Wisniewski writes in an email. McDowell agrees that AST SpaceMobile’s approach is more efficient and less wasteful. The key is its satellites size and sophistication. ASTs first generation of commercial satellite, the BlueBird 1-5, unfolds into a massive 693-square-foot array in space. Today, the company has five operational BlueBird 1-5 satellites in orbit, but its ambitions are much bigger. On December 24, 2025, AST launched the first of its next-generation satellites from Indiacalled Block 2and this one broke records. The BlueBird 6 has a surface of almost 2,400 square feet, making it the largest single satellite in low Earth orbit. The company plans to launch up to 60 more by the end of 2026. [Photo: AST SpaceMobile] This large surface area is essential for gathering faint signals from standard, unmodified mobile phones on the ground, Wisniewski explains. It is essentially a single, extremely powerful and sensitive cell tower in the sky, capable of serving a huge geographical area. This design philosophy directly addresses the two greatest threats posed by the mega-constellation model. First, with only about 90 Block 2 satellites needed for global coverage, the sheer volume of material being launched and deorbited is orders of magnitude less than the tens of thousands planned by Starlink and others. With a 7- to 10-year lifespan, AST SpaceMobile’s satellites are designed to last longer than Starklinks satellites, which have a lifespan of about 5 years. This combination of factors drastically reduces the potential for atmospheric pollution. Additionally, a smaller number of satellites dramatically lowers the risk of orbital collisions. Fewer satellites in orbit inherently reduces the probability of collisions and the creation of space debris, promoting a more sustainable orbital environment, Winiewski says. It is a solution built on precision engineering rather than brute numerical force, a testament to a different way of thinking about the problem. As McDowell puts it, from a space traffic point of view, Fewer, bigger satellites is probably better. It is a design choice that prioritizes sustainability and risk mitigation. A reckless, brute-force plan The core idea behind Starlinks direct-to-cell service is one of brute force. It is the digital equivalent of carpet-bombing: Saturate low Earth orbit with tens of thousands of relatively small, cheap, and disposable satellites. Each one acts like a tiny cell tower in the sky, talking to the phone in your pocket. Because they are in a low orbit, the lag is minimal, and the signal is strong enough for a standard phone. Its a simple concept, but its elegance is deceptive. In reality, it has the elegance of a sledgehammer. A SpaceX Falcon 9 rocket carrying a payload of 24 Starlink internet satellites soars into space after launching from Vandenberg Space Force Base on July 18, 2025; seen from Santee, California. [Photo: Kevin Carter/Getty Images] Starlinks model relies on a constant cycle of replacement. The satellites are programmed to fall back to Earth after about five years, burning up on reentry. This is where the first major problem arises. “When they burn up, they don’t just vanish,” McDowell explains. They turn into dust, alumina dust, aluminum oxide particles. These particles are very good at destroying ozone. The long-term effect of depositing tons of this material into the upper atmosphere every single day is a terrifying unknown. We are, in effect, conducting an uncontrolled experiment on the protective layers of our own planet. McDowell notes that while a single rocket launch causes temporary, localized ozone damage, the continuous reentry of thousands of satellites creates a persistent, global problem that has never been studied on this scale. SpaceX aggressively dismissed these concerns in 2021 in a legal battle with Viasat, a rival space internet service for home, business, and military use. Its legal defense directly attacked the scientific premise that burning satellites create harmful amounts of aluminum oxide. SpaceX has been ignoring warnings about potential ozone depletion since 2024. However, the company has tried to address light pollution. When faced with an outcry from the astronomy community about its satellites brightness, it iterated on the design. First came DarkSat, an experimental coating that proved ineffective. Then came VisorSat, a deployable sunshade that blocked light from reflecting off the brightest parts of the satellite. A comparison of different generations of Starlink satellites [Image: SpaceX] McDowell tells me that now SpaceX is using a dielectric mirror film that reflects less light back to Earth. They have made a significant effort to reduce the brightness, and the newer Starlinks are substantially fainter than the early ones, McDowell says. But they are still bright enough to be a problem for the big survey telescopes like the Vera Rubin Observatory. These mitigation efforts, while commendable, address only one symptom of the problemlight pollutionand do nothing to solve the more fundamental issues of atmospheric pollution and orbital crowding. The problem is compounded by the fact that everyone is now copying the SpaceX model. Amazon’s Project Leo plans to launch more than 3,200 satellites. Beijing and some Chinese companies are planning two separate mega-constellations, Guowang and G60 Starlink, totaling nearly 26,000 satellites. We’re just at the beginning of this . . . so that gets very worrying because now it’s not just one company, it’s a whole bunch of companies, McDowell warns. To add to his worries, just this week the Chinese government has applied for launch permits for 200,000 satellites. To be clear, AST SpaceMobile’s approach is not without its own controversies. The sheer size of the companys satellites makes them incredibly bright in the night sky, a significant source of frustration for ground-based astronomers. McDowell confirms that when it launched in 2022, ASTs prototype satellite, BlueWalker 3, became one of the top 10 brightest objects in the night sky for a while. It’s a serious issue, and we are working directly with the astronomy community to mitigate our impact, Wisniewski says. The company is exploring solutions like anti-reflective coatings and operational adjustments to minimize the time its satellites are at maximum brightness. However, McDowell is not aware of anyone working with AST SpaceMobile, and the company didnt provide any specifics. According to McDowell, the size and brightness is a trade-off he believes is reasonable. Although the BlueBirds are scary bright, there aren’t that many. So I kind of prefer that approach, he says. As long as they don’t turn around then and say, Actually, we need 30,000 of these as well. A ULA Atlas V-551 rocket lifts off from Cape Canaveral Space Force Station in Florida, carrying the first 27 satellites for Amazon’s Project Kuiper, in April 2025. [Photo: Manuel Mazzanti/NurPhoto/Getty Images] A game of orbital Russian roulette Beyond the environmental concerns lies an even more immediate existential threat: Kessler Syndrome. Popularized by the movie Gravity, it is a scenario that keeps space experts like McDowell up at night. The theory, proposed by NASA scientist Donald Kessler in 1978, describes a domino effect where a collision between two objects in orbit creates a cloud of debris. Each piece of that debris then becomes a projectile that can cause another collision, creating even more debris, until low Earth orbit becomes an impassable minefield of hypervelocity shrapnel. The more satellites you have, the more the chance of a collision, McDowell states plainly. And the problem is once you have the first collision, the debris from that is now threatening all the other satellites. SpaceX has engineered a highly automated collision avoidance system for Starlink, and McDowell acknowledges its sophistication. The companys satellites constantly monitor their trajectories and can autonomously fire their thrusters to dodge potential impacts. They do thousands of maneuvers a month, he says, which is a testament to both the system’s capability and the terrifyingly crowded environment it operates in. In total, Starlink satellites have performed 50,000 evasive maneuvers since 2019. But while SpaceX claims that its satellites are 100% safe, the facts tell us that they are not foolproof. Even with a 99% success rate for deorbiting, a 1% failure rate on a 30,000-satellite constellation means you’re adding 300 dead, multi-hundred-kilogram satellites to orbit every five years, McDowell says. That’s 300 uncontrollable bullets waiting to start the Kessler Syndrome. A catastrophic chain reaction could, in a matter of hours or days, wipe out the essential satellite networks that underpin modern civilization. This isn’t just about losing your GPS navigation on the way to a new restaurant. It’s about the collapse of global finance, weather forecasting, communications, and critical military and disaster-response systems. We are talking about a technological regression of decades, a scenario McDowell finds increasingly plausible as more mega-constellations are launched. Its a high-stakes gamble with civilization’s essential infrastructure. Theres also a direct-hit danger for people on the ground. A few Starlink satellites have already failed in orbit, becoming uncontrollable space junk that fell back to Earth. Theres at least one report of a piece of a satellite hitting a building in Canada. The latest reported incident took place on December 17, 2025, when a Starlink satellite experienced an anomaly, losing communication and causing a propulsion tank vent, rapid orbital decay, and the release of debris in low Earth orbit. In a 2023 report to congress, the Federal Aviation Administration said theres a real risk of falling Starlink debris injuring or killing someone by 2035. The Shenzhou-20 launches from Jiuquan Satellite Launch Center in northwest China on April 24, 2025. [Photo: Li Xin/Xinhua/Getty Images] Space junk is also a problem for rockets. In early November, three taikonauts returned after being stranded on Chinas Tiangong space station for nine days. They couldnt use the spaceship that was going to take them to Earththe Chengdou-20because it had been struck by orbital debris. The China Manned Space Agency said its astronauts found “tiny cracks” in a small window of their Shenzhou-20 spacecraft. The hit was not fatal, but things could have gone very wrong. The Chinese, however, seem undeterred. Beijing will be launching hundreds of thousands of satellites that mirror Starlinks design, contributing to the problem and increasing the risk to themselves and everyone else. Why AST SpaceMobile could win Right now, Starlink doesnt provide direct-to-cell broadband; instead, it provides only text and limited data connections. This low-speed connectivity requires a line of sight with the satellite, as SpaceX states on its site. Starlink, despite its leading market position in the internet satellite business, is still playing catch-up on the direct-to-cell front, and it may never be able to close the gap with AST. Musks company has two big strikes against it. First is the hardware in orbit. To provide broadband to phones it needs a next-generation Starlink V3 satellite, which doesnt exist yet. SpaceX has no reliable way to launch it, anyway. At an estimated 4,400 pounds, the V3 satellite is too big and heavy for the workhorse Falcon 9 rocket to deploy in economically viable numbers. The entire business model for Starlink V3 hinges on the success of Starship, Musk’s next-generation, super-heavy-lift launch vehicle. But Starship remains in development, having yet to achieve the consistent opertional launch cadence required to deploy and maintain a constellation of thousands of V3 satellites. But even if SpaceX manages to finish Starship and Starlink V3 satellites on time, theres a second, even bigger hardware problem: The broadband connectivity wont work unless the cellphone has a special modem chip. Yes, my space cadets, you will need to buy a new phone to enjoy Starlink connectivity, while AST works with any current, unmodified phone. None of these new Starlink-enabled phones exist or have been announced yet. According to SpaceX CEO Gwynne Shotwell, the company is now working on this chip. [Rendering: AST SpaceMobile] Were working with chip manufacturers to get the proper chips in phones, she told the audience at World Space Business Week in Paris back in September. Expecting phone manufacturers to incorporate Starlinks proprietary modem in their phones feels like a tall order. Especially when manufacturers like Apple have their own direct cell-to-space plans. It seems unlikely that Tim Cook will tie his companys crown jewel to Musks whims. Or make the phones even more expensive. However, that doesnt matter, because even if Musk had 15,000 V3 satellites and the Starships ready to launch, the problem will remain the same: You will need phones with Starlink modems in them for broadband. And the line-of-sight problem will persist. The broadband works only when the phone can look at the satellites in the sky. This is why Musks promised direct-to-cell broadband timeline is speculative. In fact, while he said it would be ready in 2026, according to SpaceX, testing of the first phones equipped with Starlink chips is scheduled for this year, with an aim to complete its V3 direct-to-cell satellite constellation in 2027. It is a promise built on a promise, a technological if dependent on a logistical when. Meanwhile, AST SpaceMobile is preparing to launch new operational satellites on existing rockets. AST SpaceMobile has already proven its technology works, with six working satellites now transmitting at typical 5G speeds directly to regular phones. This doesnt mean that it has a guaranteed win against Starlink or any of its competitors. While it has the capital to execute its planwith the backing of investors like AT&T, Alphabet, Rakuten, Vanguard, BlackRock, and Mexican magnate Carlos Slim, who owns the largest telecom operator in Latin Americaand superior technology, it needs to execute dozens of launches. This confidence in the technology explains why the stock has skyrocketed 333% in a year, but the doubts about potential execution problems also explain why the stock experiences wild swings. With every news of a launch or a delay of a launch, the stock can swing 10% or 20% up and down. Thats why the market treats AST as a high-risk, high-reward battleground. It can be a trillion-dollar business or explode on the launchpad if the company doesnt put all those satellites up in 2026. The coup de grâce This technological and philosophical divergence has not gone unnoticed by Elon Musk. Seeing a direct threat to his ambitions, he has engaged in a campaign to undermine AST SpaceMobile with baseless accusations, claiming that its satellites are a danger in low Earth orbit because of their size. At the same time, Musk is battling his own problems in low Earth orbit. China has already denounced two near misses with Starlink satellites that triggered its space station to perform emergency evasive maneuvers. On January 2, SpaceX was forced to move 4,000 satellites to a lower orbit after new research by Chinese scientists highlighted the companys recklessness and the very real risk of collision. Moreover, Musk desperately tried to stop the Federal Communications Commission from granting AST access to the necessary spectrumthe range of radio frequencies it needs for its satellites to connect with cellphones on Earthclaiming it would be catastrophic for his service because the powerful signals from AST’s large satellites could interfere with Starlink’s user terminals. In response, AST SpaceMobile asserts that its system is designed to coexist with other networks and operates fully within the internationally agreed-upon limits established to prevent such interference. The FCC agreed and allowed AST to use the spetrum. And that move, if every logistical aspect executes to plan, gives AST an absolute slam dunk against Musk. Think of the radio spectrum as a giant highway in the sky with a limited number of lanes. Carrying data back and forth, ASTs trucks have the rights to travel through a huge number of these lanes thanks to partners like AT&T and Verizonroughly 35 MHz of what the industry calls the “golden low-band spectrum. It also acquired an extra 45 Mhz low-band spectrum from a bankrupted communications company called Ligado. Thats a massive 80 MHz. And remember the companys patented magic sauce we mentioned earlier? Thats ASTs secret weapon to make this highway work: a chip that glues the different radio bands together into one massive pipe, capable of delivering peak speeds of 120 megabits per second to phones (comparable to your typical 5G connection). [Rendering: AST SpaceMobile] SpaceX and its partner T-Mobile have very few lanes available right now: only 5 MHz. Thats like comparing an 80-lane superhighway to a 5-lane street. To try to fix that, Musk has spent $17 billion to acquire 50 more lanes: 50 MHz of S-band spectrum from another bankrupt communications company, EchoStar. The problem is that physics dictates that higher-frequency radio waves, those that SpaceX is operating on, do not penetrate solid objects as effectively as lower-frequency waves. Thats why Starlinks space-to-cell service will require line of sight to work. Meanwhile, AST claims its system will work indoors and outdoors, penetrating buildings in a similar way to a regular cell signal. Wisniewski claims that a phone will connect through one wall and work through your cars roof because of two factors: It uses a low-frequency radio connection, and its satellites are big enough to listen and talk to the phones on the ground, even behind obstacles. This scenario has yet to be proven by AST or a third party. Only line-of-sight broadband with regular phones has been tested successfully. However, if it works inside cars and buildings like Wisniewski claims, the user experience will be seamless. A phone will have service where it didn’t before, delivered through an existing provider like AT&T or Vodafone. Should we really do this? But what if were looking at this cell-to-space race the wrong way? “I hear from friends who go hiking in faraway places, look up at the sky, and say, ‘Wow, you just never see an empty sky anymore, McDowell tells me with a hint of sadness and worry. Musk, Bezos, Wisniewski, the Europeans, and the Chinese would argue that we need ubiquitous cheap internet everywhere in the world, for civilian and military applications. Sure, there’s a lot of money to be made and there’s a genuine need to serve communities in remote places without having to invest in ground infrastructure. But do we really need to stream TikTok from space? “I don’t necessarily have a position on that,” McDowell says. “My position is that even if that’s the case, it shouldn’t be just the U.S. that decides that. It should be decided by all of the countries in the world, because they’re all affected whether they’re space powers or not.” Hes right. And if we all decide that we do need this, we should also all agree on the best solution to minimize the impact on humanity. The smarter solution. The most technologically advanced.
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** NEEDS JUSTIN POT BYLINE ** Have you ever opened your favorite music-streaming app and wondered why all your playlists have the same five songs? It can be annoying, even if they happen to be five songs youre really into right now. And, make no mistake, they will be five songs youre really into right now, because thats how many of these services workand its not because everyone else has the same taste in music as you. For instance, any Spotify playlist that says created for in the header is catered to the individual user, based on their listening history. Theres nothing wrong with that, necessarilyit can be nice to know youre going to hear songs you like. But there are downsides. Mostly, this feature makes it hard to discover new music. Maybe you want a little bit of an idea of whats going on in the broader culture. Maybe you love discovering new songs. Music-streaming services have a tendency to stick the same songs into every playlist and radio station, but theres a way to get out of the same ol song rut. This tip originally appeared in the free Cool Tools newsletter from The Intelligence. Get the next issue in your inbox and get ready to discover all sorts of awesome tech treasures! Time to escape the algorithms Ive actually got two Cool Tools to share with you today. Both of these tools will help you escape the music-streaming algorithms so that you can discover and listen to new music. You can start using either of them in an instant. 1 The first tool is called Spoqify, and it creates a clean version of any Spotify playlist or radio station so you can listen to music like an anonymous user. Spotify, without the suggestion-controlling historywhat a novel concept! The easiest way to use Spoqify is through a browser. To get started, simply: Copy the URL for any playlist or radio station on Spotify Change the t in spotify.com to a q Paste that new URL into a browser The service will instantly create a playlist for you containing what Spotify would show you if it had no prior knowledge of your listening habits. You can now listen to the updated playlist and even save it to your library. Though it is a bit of a workaround, you can still use Spoqify if youre on the Spotify app. Granted, its not as simple (youll need to install a tool called Spicetify), but it allows you to listen to Spoqify without ever leaving the service. (Also, is anyone else getting confused with all the Spotify/Spoqify references?!) 2 If you dont use Spotify or you dont want to mess with URLs, you could always check out Playlist Generatortodays second Cool Tool. This separate service lets you search for any song, artist, or album and creates a list of similar songs. It reminds me of Pandora, back in the day. Once you generate your playlist on Playlist Generator, just click on the Transfer buttonand you’ll be taken to their partner site, where you can export your playlist to any number of streaming services. Or, if you want to listen on Spotify, you can connect Playlist Generator with Spotify to save a list directly to your library. Playlist Generator is a little like Pandora back in its heyday. Ive been enjoying both of these services, though I recommend combining tools like these with a good community radio station, if your town has one. Theres nothing like real human DJs for finding new music. Both of the services mentioned here will work in any web browser. Theyre also both completely free. You can use both Spoqify and Playlist Generator without creating accounts, though you can connect your Spotify account to Playlist Generator if you want. Playlist Generator does also collect some information, but the sites privacy policy makes clear that it doesn’t sell or share your personal information in any shady-seeming ways. Treat yourself to all sorts of brain-boosting goodies like this with the free Cool Tools newsletterstarting with an instant introduction to an incredible audio app thatll tune up your days in truly delightful ways.
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Over a long and industrious career, the investor George Soros developed a theory he calls reflexivity. The basic idea is that expectations dont form in a vacuum. They are shaped, in part, by our perceptions of what other people believe. The more widely an idea is accepted, the more likely we are to accept it ourselves and that, in turn, reinforces the collective wisdom. If many believe that, say, the stock market will go up or that AI will create an economic boom, were more likely to believe it too. That belief then drives behavior: investors buy stocks, companies pour money into AI, and the prediction begins to fulfill itself. All of this only adds fuel to the fire. Nobody wants to get left out of a good thing. Soros made a lot of money betting against reflexivity because once the pattern of self-reference and self-reinforcement takes hold, things are bound to overshoot. Expectations drift far beyond underlying realityand eventually snap back. It seems something similar is brewing. As big institutions accumulate unprecedented power, a growing backlash seeks to take power back. The rise and fall of Porters competitive advantage For decades, the dominant view of business strategy was shaped by Michael Porter’s theory of competitive advantage. In essence, he argued that the key to long-term success was to dominate the value chain by maximizing bargaining power over suppliers, customers, new market entrants, and substitute goods. Yet as AnnaLee Saxenian explained in Regional Advantage, around the same time that Porters ideas were gaining traction among CEOs in the establishment industries on the East Coast, a very different way of doing business was gaining steam in Silicon Valley. The firms there saw themselves not as isolated fiefdoms, but as part of a larger ecosystem. The two models are built on very different assumptions. The Porter model saw the world as made up of transactions. Optimize your strategy to create efficiencies, extract the maximum value out of every transaction and you will build a sustainable competitive advantage. The Silicon Valley model, however, saw the world as a web of connections and optimized their strategies to widen and deepen linkages. If you see your business environment as neatly organized into specific industries, everybody is a potential rival. Even your allies need to be viewed with suspicion. So, for example, when a new open source operating system called Linux appeared in the 1990s, Microsoft CEO Steve Ballmer considered it a threat and immediately attacked, calling it a cancer. Yet even as Ballmer went on the attack, the business environment was changing. As the internet made the world more connected, technology companies found that leveraging that connectivity through open source communities was a winning strategy. Microsofts current CEO, Satya Nadella, declared that the company now loves Linux. Ultimately, it recognized that it couldnt continue to shut itself out and compete effectively in a networked world. Preferential attachment, power laws, and network collapse Phil Knight built Nike into exactly the type of business Porter imagined. It created an impressive marketing machine built on partnerships with famous athletes, dominance of retail channels, including its own proprietary outlets, and an optimized supply chain that kept costs to a minimum. The company was a paragon of sustainable competitive advantage. Then, in the early 1990s, writer and activist Jeffrey Ballinger published a series of investigations about Nikes use of sweatshops in Asia. People were shocked by the horrible conditions that workersmany of them childrenwere subjected to. In many cases, factory owners lived outside the countries where the facilities were located and had little contact with employees. As the network scientist Albert-László Barabási and his colleagues discovered, this is exactly the type of asymmetric vulnerability that even the most powerful fall prey to. A firm like Nike becomes dominant because of a phenomenon called preferential attachment, sometimes also called the Matthew effect. Essentially, the rich get richer. What happens is that once a node in a network builds a small advantage over competitors, it is more likely to attract new connections than smaller players. That creates a power-law distribution in which the network is dominated by large hubs that are exponentially larger than their competitors. Yet the sweatshop scandal threatened to reverse that process, making rivals without scandals marginally more attractive to consumers than Nike. That shift, however small at first, could cascade, allowing rivals to strengthen relationships with suppliers and retailers, widening and deepening their corporate networks at Nikes expense. At first, Knight was defiant, but ultimately, even he recognized he needed to give in. As he would later write in his memoir, Shoe Dog, We had to admit. We could do better. Going beyond its own factories, the company established the Fair Labor Association and published a comprehensive report of its own factories. Backlashes, old and new Today, we live in a new era ofbig business dominance. Just seven companies dominate the U.S. stock market. The economist Thomas Philippon and his colleagues have documented how the growing dominance of large firms across increasingly consolidated industries has led to a decrease in competition in the United States. A Federal Reserve report had similar findings. Weve been here before. The Gilded Age in the late 19th century was marked by enormous investment in a breakthrough technology: railroads. Vast fortunes were made and a breed of oligarchs like Vanderbilt, Carnegie, and Rockefeller created industry trusts that allowed them to dominate the United States, both commercially and politically. Yet every revolution inspires its own counterrevolution. The Gilded Age was soon followed by the Progressive Era and the rise of the muckrakers epitomized by Ida Tarbell, Upton Sinclair, and McClures Magazine, who exposed corruption and exploitation on a massive scale and shifted the political winds. New legislation and enforcement tools, such as the Sherman Antitrust Act, led to a leveling of the playing field. Today, we are seeing similar signs. The Australian government has banned social media for children under 17. Frustration with the low-quality content that AI has flooded the internet with led The Economist to name slop as its Word for the Year. Elon Musks effort to bring Silicon Valley management techniques to government with DOGE was a massive failure, which resulted in hundreds of thousands of deaths. Against this backdrop is a growing New Brandeis movement, which seeks to reinvigorate antitrust efforts and restore competitive markets. After gaining traction during the Biden Administration, it has mostly been dormant since, but things can change quickly. Larger risks amid lesser resilience In 2008, when the global financial crisis hit, the world was a relatively stable place. While the U.S. was still engaged in Iraq and Afghanistan, those were fairly low-level conflicts at that point. The U.S. federal deficit was $450 billion and the U.S. national debt was $10 trillion, both less than a third of what they are now. Today, the world is a very different place. Beyond the worsening economic situation, we have the largest conflict in Europe since World War II. Russia, China, and other bad actors are engaged in a massive information war against the West, fueling populist surges and political turmoil in Western nations. The Atlantic Alliance, once a force for stability, is in shambles. Many would argue that, today, we are in a new Gilded Age, in which powerful industrialists, unbeholden to the rule of law, regularly engage in predatory behavior, but their actions are often shielded from view by technology, buried in complexity. When they are called before Congress, the peoples representatives seem lost, unable to meaningfully challenge their power. And much like the Gilded Age was marked by continued cycles of government-sponsored overinvestment and financial panics, today we are likely on a path to an AI bubble that will rival the massive panics we had in 1873 and 1893. Unfortunately, unlike during the 2008 financial crisis, our capacity to manage the fallout will be greatly diminished. Clearly, we are on a path that is taking us into rough waters. As Soros described, once the pattern of self-reference and self-reinforcement has taken hold, systems dont correct gently. They overshootand the eventual snapback is rarely orderly or kind. Correction will not come from markets alone. It will come through backlashpolitical, social, and institutionalwhen those left bearing the costs decide the system no longer serves them.
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