Today Apple, Nvidia, Microsoft, Alphabet, Google and Amazon with a combined market cap of nearly $15 trillions are top five major companies (January, 2025) in hi-tech capitalism of USA. All these economic giants are information technology based and rely on cutting edge AI. A day after his swearing President Trump, last week, announced the Stargate, a $500 billion investment by private sector, an initiative to expand US AI infrastructure. This has been hailed as a major capital venture that would define future AI research with top end technical applications to rule the market in decades to come. It is therefore not surprising that President Donald Trump has called development of DeepSeek a “wake-up call.” DeepSeek appeared on the world stage at a time when USA wants to bully the world , especially China with chip and trade sanctions to acertain its declining economic and political dominance.
However, all of a sudden DeepSeek, a Chinese AI model announced a few days later. This unexpected sudden entry shook the ruling US artificial intelligence technology giants so much that it triggered a selloff in Nvidia and other US IT majors, sending Nasdaq tumble a 3 per cent (nearly $1.3 trillions) overnight. In a word DeepSeek has shaken the high-tech US capitalism at its very core. Rather a serious blow to capitalism in its unethical use of science for high profits search but not for public good.
DeepSeek, developed as an open-source large language model (LLM), and even matches the performance of popular GPT-4o. The neural net based deep learning model outperforms it’s competitors with AI platform’s architecture and robust high-quality parameter processing performance, superior in areas like mathematics and high-end computing. High capability and superior performance of DeepSeek is achieved with lower-end technology and tiny investments much lower to budgets of US high tech giants. Recent US restrictions on the export to China of high-tech components, Nvidia’s H100 and H800 chips commonly used in AI. Using less data, less computing power, superior algorithms and a fraction of the cost. China could succeeded to build DeepSeek with lower end Hi-tech chips by employing robust algorithms and outperforming its competitors OpenAI, Microsoft, Google, and others with much lower investments.
Released, as an open-source AI, DeepSeek matches or outperforms U.S. models like ChatGPT 40, but costs 97% less to operate, and can be downloaded and used freely by anyone in public domain.
Serious Challenge to American capitalism:
Today American capitalism stands on the foundation of Hi-tech. Without Hi-tech there will almost no growth in stock markets at all. With shifting of traditional sectors like automobile, chemicals, pharmaceuticals to China, India, Vietnam and others US economy is based on arms industry, Hi-tech electronic chips, Petroleum and information technology. As noted in the beginning of this article five big information technology companies dominate the economy. Eenoramous wealth generated thus is concentrated amongst a tiny proportion of people in the US. These flagship industries are earning big profits and creating dozens of billionaires every month. Today President Trump is mobbed by some of these technical giants is no wonder. These companies are all about the concentration of power and represent today’s US capitalism.
The fact that Nasdaq and other American stock markets are booming is largely because of hype around AI. All the flagship firms and their products are based on advances in machine learning and Artificial Intelligence (AI) systems. Any competitor outside the system is a potential challenge to American capitalism.
In just 15 years, the global technological landscape has been transformed. Between 2003 and 2007, the United States led in 60 out of 64 key technologies. By 2022, this dominance had reversed, with China leading in 52 technologies- a dramatic shift in global technological supremacy. Hi-tech supremacy should not be the monopoly of yet another nation like China but should be a collective scientific effort by a group of southern nations such as BRICs.
American capitalism stands on two pillars. 1. Monopoly over modern Hi-tech, 2. Patenting the technology to protect and maintain this monopoly to dominate markets and scare away the competitors. DeepSeek has partially shattered these myths. Availability of AI tools cheaply or almost free in open source is totally a different approach to the market and threatens big profits so far earned by captains of American industry.
However, any breakthrough inventions like DeepSeek, ChatGPT, Solar panels, Drones, vaccines emitting either from Quantum electronics or Neural net based AI models or modern drug design or genome sequencing should primarily benefit both workers and consumers. Secondly, today U.S. tech companies and capitalism across the world is using monopoly on AI to monitor workers, lower wages, bust unions, or shift work to machines altogether, leading to cutbacks and layoffs. Ease and superior efficiency at work place should liberate workers, scientists, software programmers from long working hours, provide them higher wages and free time to spend quality time. Use of drones or hi-tech AI in war industry should be banned and should exclusively employed for human good and peace. Like electricity, internet or any basic utility, present day AI technology should be treated as part of commons and accessible to all without expecting big profits. Sensible use of science for peace and human progress can only achievable in socialism and its very unscientific to expect this to happen under capitalism.
Dr. Soma Marla, Principal Scientist, Bioinformatics & Genomics, (retd), Indian Council for Agricultural Research, New Delhi.
