☕️ CHIP OF THE WEST ☙ Saturday, May 31, 2025 ☙ C&C NEWS 🦠

Deep AI dive on the gap between milspec AI and chatbot toys; AI arms race (or more?); Tolkien, Trump SCOTUS wins, rainbow flag erasure, and WaPo baffled by Trump victory; lots more.

Good morning, C&C, it’s Saturday! Welcome to the Weekend Edition, which today coincides with May’s conclusion. Summer is officially here. In today’s roundup: Another deep AI dive, as we witness growing daylight between milspec AI and the hallucinating chatbots that we get; a historical perspective on the growing AI arms race —or is it more than an arms race— including timely Tolkein callbacks; another state joins the alphabet pushback and literally erases rainbow flags; more wins for Trump at Supreme Court, this time related to deportations; and Washington Post becomes confused over landmark Trump policy victory.

🌍 WORLD NEWS AND COMMENTARY 🌍

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The phrase “AI safety” is becoming a very strategically flexible term of art. This week, SlashGear ran a suggestive story headlined, “Fury: America's New Superweapon Is A True Technological Marvel.” That much was absolutely true.

Anduril Technologies, the startup behind Fury, is no legacy military contractor like Raytheon or Boeing. The company, which launched like a rocket in 2017, was founded by Palmer Luckey, the teenaged wunderkind who designed the Oculus Rift VR headset. He was born in 1992! In other words, he’s now just 32 years old, and was 24 when he started the company.

Revenge of the Nerds, with a kill switch.

Anduril, which just turned seven, is already valued at $36 billion—just below industry legend Raytheon’s valuation. The young company enjoys unusually close ties with U.S. military leadership, and skips past traditional defense procurement red tape under special programs like Defense Innovation Unit (DIU) and SOFWERX.

In its brief corporate life, Anduril has delivered advanced miltech solutions and secured generous production contracts, particularly for its flagship product, a key bit of software called Lattice OS. The company describes it as “an AI-powered operating system designed to orchestrate autonomous defense systems across land, sea, air, and even cyberspace.”

The operative word is “autonomous.” Lattice isn’t for manually flying drones using a joystick and a VR headset. It’s for issuing goal-oriented commands— like those you would issue to human soldiers. Commands like, monitor this valley, engage anything crossing this perimeter, neutralize radar emitters in zone Alpha, or destroy the Eiffel Tower.

There’s no pilot. There’s just Bob, back at the base, making suggestions.

The article described Fury, Anduril’s latest hardware prototype, a pre-production proof-of-concept. It’s similar to how Tesla both writes its self-driving software and also builds the cars that use it. Except that military-grade AI is obviously far beyond chatbots, self-driving Teslas, or whatever else we experience from consumer-level AI tech.

The SlashGear article introduced Fury as a 20-foot-long autonomous fighter jet —not a drone— capable of climbing to 50,000 feet, hitting Mach 0.95, and sustaining +9 Gs. Designed for air-to-air combat; it’s made to fly and fight by itself.

“Fury,” the article explained, “is a high-performance, multi-mission group 5 autonomous air vehicle (AAV).”

We could pause here to wallow in the well-worn moral murk — the classic handwringing over whether autonomous killing machines are morally ambiguous or whether “AI safety” still applies once your autonomous AI jet is pulling 9 Gs and launching air-to-air missiles. But set that ethical quagmire aside.

🚀 My question for today is much simpler: how stupid do they think we are? The answer is, pretty stupid, apparently.

Apparently, it is only minor news to the defense industry —ignored by corporate media— that military AI can be trusted to navigate a $30 million fighter jet in three-dimensional space under combat conditions, but they are also telling us that they can’t figure out how to get your chatbot to open the browser by itself and renew your driver’s license.

It makes less than no sense.

I’m a lawyer, not an AI engineer with a Q-clearance, so obviously I don’t know. But for Heaven’s sake, I can read. If AI can fly jets at supersonic speeds and battle it out in dogfights with other AI fighters, then the technology accessible to the military is light years beyond suggesting a polite way to decline an invitation to your kindergartner’s classmate’s bar mitzvah.

It makes me wonder: Was last week’s breathless “disclosure” of an AI-turned pharma whistleblower real? Or was that just a psyop, designed to convince us that consumer AI tech should be locked down and hobbled for safety? In actual truth, are they intentionally dribbling AI out slowly, to keep our enemies behind the eight ball and maybe to protect our economy from being disrupted too quickly?

In podcast after podcast and conference after conference, they keep warning us about the coming threat of artificial general intelligence — the moment AI becomes smarter than people — while also insisting, over and over, that we’re still years away from that troubling milestone. But isn’t it odd that they only ever talk about consumer AI — chatbots, homework helpers, and virtual therapists — and never speculate about the AI already flying autonomous military aircraft, managing battlefield logistics, or directing drone swarms at the speed of thought?

For the last year — maybe longer — we haven’t seen meaningful progress in consumer chatbot intelligence. Instead, we’ve been dazzled by a parade of low-stakes novelties: talking image generators, dancing avatars, and viral clips of AI-generated cats telling dad jokes in Morgan Freeman’s voice.

It’s not that AI has stopped evolving —clearly not— it’s that we’re being shown the circus, not the control room.

🚀 Once you begin wondering what AI level we are really at, recent history begins to make a lot more sense. Aside from the Proxy War in Ukraine, the next-most terrifying conflict was the escalation over the Strait of Taiwan. Starting around 2021, China and the U.S. faced off with naval fleets to fight over the one island where most AI chips are made.

For two years straight, all Nancy Pelosi could talk about was semiconductors. “Chips this, chips that, squaaawk” and she kept flying her broomstick into Taipei like it was spring break for congressional war hawks. CNBC, 2022:

Now, in 2025, President Trump has just declared a new Manhattan Project — not for bombs, but to supercharge our national energy grid and fuel the computing demands of massive new AI data centers.

Make no mistake. The real arms race is no longer nuclear. The real arms race is artificial intelligence. I doubt anyone would bother arguing the point.

🚀 Once you realize that AI is the new arms race, recent history stops looking confusing — and starts looking obvious. The Ukraine war dominated headlines. But the real geopolitical near-miss was the 2022 standoff over Taiwan — the one triggered by Nancy Pelosi’s surprise visit to the island. Officially, she was there to support democracy. But every journalist with a press badge knew the real story: the day-drinking day-trader was there to protect the global supply of AI chips.

The chipmaker Pelosi invited war with China to visit was Taiwan Semiconductor (TSMC)— the quiet fabrication engine behind NVIDIA’s GPUs, Apple’s SoCs, and nearly every serious AI training run on Earth.

Congress was already acting. The 2022 CHIPS Act prioritized onshoring domestic chip development with $52 billion in federal funds— and since he took office, President Trump has expanded and accelerated the CHIPS initiative, declaring a national security emergency, allowing faster permitting and easier zoning, and using tariffs to force domestic sourcing of defense-related chips.

It’s working. Taiwan’s TSMC is now building a massive $165+ billion fabrication complex in Phoenix, Arizona. It’s scheduled to come online in phases between 2026–2028. Axios, this month:

Intel, long dormant, is also staging a major chipmaking comeback with new U.S. fabs in Ohio and Arizona — thanks mostly to Trump’s industrial pressure campaign.

🚀 None of this is particularly any secret. As far back as 2018, defense rags were accurately predicting current events. In April, 2018 —just after Palmer Luckey founded Anduril— DefenseOne ran this prophetic story:

The prescient analysis, written by defense strategist Elsa B. Kania, warned that the world was already locked into an AI arms race — not just between the U.S. and China, but including Russia, India, Israel, even non-state actors like ISIS, who were using commercial drones to deliver battlefield intelligence.

Back then, the military’s Project Maven had just launched. The Pentagon’s Joint Artificial Intelligence Center (JAIC) didn’t exist yet. ChatGPT wasn’t even a glimmer in the public’s eye.

Kania called it “more than” an arms race because — unlike nuclear missiles — AI isn’t a discrete, singular weapon system. It’s a general-purpose technology, like electricity, or the steam engine, capable of transforming every aspect of military power: cybersecurity, battlefield decision-making, electronic warfare, logistics, surveillance, and strategic planning.

In other words, AI doesn’t just change what militaries do — it changes how they think. And that means traditional “arms race” metaphors break apart. Kania argued that framing the AI revolution purely in “weapons race” terms missed the bigger picture— that AI will become the nervous system of every future military, not just its weapons lab.

I can’t emphasize this enough: years before ChatGPT suggested possible recipes for the three overripe vegetables left in the fridge, the military was accurately forecasting the future arms race (more than). Which means that, in 2018, they must have already enjoyed enough operational AI capability to know where we were headed.

Perhaps a better question is: why did they let us have ChatGPT at all? Whatever the reason, OpenAI did not create the AI revolution. It was a relatively late player.

🚀 Tech bro Palmer Luckey named his billion-dollar startup Anduril and it wasn’t an accident. The name refers to J.R.R. Tolkien’s The Lord of the Rings and it carries a heavy thematic payload.

In Lord of the Rings canon, Andúril means “Flame of the West,” which was the reforged sword of Elendil, later wielded by Aragorn, the rightful king of Gondor. Andúril was reforged from the shards of Narsil, another legendary sword that sliced the One Ring from Sauron’s hand.

In short, Andúril was a weapon, a weapon of ancient power, reforged in modern hands to reclaim rightful dominion.

“Anduril” wasn’t just branding. It was mission signaling. Naming the company Anduril signaled mythic ambition, restoration of lost power, and righteous moral framing. It’s a civilizational project. Palmer sees himself as rebuilding America’s lost military edge— like Aragorn returning to reclaim his throne. And it suggests Palmer’s team sees itself as the good guys, wielding dangerous power to combat evil.

🚀 What does it all mean? It means that we regular folks aren’t witnessing the rise of AI. We’re witnessing its containment.

For the past year, the public discussion has been fixated on the wrong question. Talking heads fret over whether ChatGPT might say something offensive, or whether Midjourney might draw the wrong number of fingers. We are told that AI isn't quite ready — it's potentially dangerous, often unpredictable, hallucinates too much, and is a bit too quirky for real work. They claim we're years away from so-called artificial general intelligence, and that “alignment” must come first.

Meanwhile, military-grade AI is flying 9G fighter jets.

This is not any kind of conspiracy theory. None of this is secret. The defense journals were writing about the AI revolution back in 2018, and even earlier, well before consumer AI hit the scene. Along with his venture capital partners, Palmer Luckey invested billions in writing an AI operating system — in 2017!

Back then, defense analyst Elsa Kania warned not that we were entering an AI arms race — she said we were already in one. She accurately labeled it "more than" an arms race that would reshape every dimension of military, economic, and political power. And that is just what is happening.

Anduril Industries, founded in 2017 by a 24-year-old Palmer Luckey, wasn’t predicting the future — he was building out the present. The firm’s software platform, Lattice OS, isn’t a helpful chatbot. It’s a battlefield operating system for managing fully autonomous weapons across land, sea, air, and space. The new aircraft, Fury, is a fully autonomous fighter jet. Not merely a prototype — it’s a fully functional, AI-based weapons system.

Don’t misunderstand: I am not complaining about consumer AI’s throttling, not really. It seems logical on many levels. For one thing, the economy needs time to absorb what’s coming. And I also get that we don’t need China stealing weapons-grade AI from Microsoft Word’s Copilot.

But it is aggravating that the AI conversation itself has been nerfed and dumbed down, with the enthusiastic participation of useless corporate media that consistently obscures the true issues, and instead runs ridiculously superficial articles mocking small AI mistakes in MAHA reports. The AI that flies 9G fighter jets doesn’t make those kinds of easy errors. Just the versions that we get.

And if we can’t honestly debate AI, how can we participate in deciding who weilds Andúril?

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On Thursday, Pink News ran an unintentionally encouraging story headlined, “Montana bans Pride flags in schools and government buildings.”

Called “Big Sky” for a good reason, Montana is a fiercely independent state. There’s no sales tax, it allows permitless open carry, and only about ten years ago did they finally cancel a law permitting duels between consenting adults. But it’s less conservative and much more libertarian leaning. For instance, you can legally get high if a doctor okays it.

Given the state’s strong libertarian streak, this week it was somewhat surprising that Montana’s Governor Greg Gianforte (R) signed a terrific new law banning Pride flags from public schools (and all government property). The law was constitutional, and not a prohibited First Amendment violation, because it restricts any flags that “represent a political party, race, sexual orientation, gender, or political ideology.”

Lots of folks complained. They think the Big Sky is falling. But it’s not completely clear to me how removing rainbow flags from classrooms literally erases gay people. I mean, I get that the new rules might erase rainbow flags, but the gay people are literally still there. We don’t need to know. TMI.

Corporate media ignored the story, which is why I had to go to Pink News, but I thought you’d appreciate knowing.

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Yesterday, the New York Times ran another terrific story headlined, “Supreme Court Allows Trump Administration to End Biden-Era Migrant Program for Now.”

CLIP: Fox News reports another Supreme Court win for President Trump (0:43).

Yesterday, the Supreme Court issued an unsigned 7-2 order allowing the Trump Administration to revoke Biden’s designation of over half a million illegal immigrants as protected refugees under “humanitarian parole.” The case will continue (assuming the plaintiffs persist), but the Administration can continue deporting unlicensed non-citizens in the meantime.

Justices Jackson and Sotomayor —but not, curiously, Justice Kagan— were predictably outraged. In a scathing, hyperbolic dissent, the two ladies furiously wrote that the majority’s order would create “the devastating consequences of allowing the government to precipitously upend the lives and livelihoods of nearly half a million noncitizens while their legal claims are pending.”

It would be great if they could ship back the entire half million precipitously, but sadly, I doubt it can happen that fast.

This was Trump’s second immigration win this week. SCOTUS also allowed the Administration to revoke a different Biden program called “Temporary Protected Status,” which affected another crowd of around 350,000 more poorly vetted non-citizens.

Karen Tumlin, founder of the Justice Action Center, an immigrant advocacy NGO, was furious. “The Supreme Court has effectively greenlit deportation orders for an estimated half a million people, the largest such de-legalization in the modern era,” Karen said without any exaggeration. Karen.

But conservative legal commentator Jonathan Turley called the week a “considerable win for the Trump Administration.”

In ruling on both cases, the Supreme Court didn’t enunciate its reasoning. Still, it seems to agree with the simple logic that, if Biden could legally dish out temporary protected status, then President Trump can end that same temporary protection. That straightforward logic might appear obvious, but judges in lower courts found more complicated ideas to be more persuasive.

All week, corporate media packed its pages with heart-rending “human interest” stories about sympathetic illegals getting deported. You’ve seen them. But the nuance the virtue signaling reporters always miss is: who should be blamed for this human tragedy? President Trump, who is legally giving them free flights back to their home countries? Or is it more accurate to blame the vegetative president who tricked these poor people into coming here in the first place?

Anyway, the system is working. Don’t throw in the judicial towel yet.

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Unexpectedly! Yesterday, the Washington Post ran a farcical story headlined, “The mysterious drop in fentanyl seizures on the U.S.-Mexico border.” It’s a mystery! The sub-headline piled on the hilarity: “The reasons behind the decrease of fentanyl seizures in the U.S. and along the Mexico-U.S. border are complex.” It’s complicated! It’s so mysterious and complex.

The article never reminded readers that, on his first day in office, President Trump immediately declared a national state of emergency over fentanyl. Nor did it mention the weeks of Trump’s very public arguments with Mexican President Claudia Scheinbaum, Canada’s Justin Trudeau, and China’s President Xi about the drug, and about the President’s demands for those leaders to do more to stop trafficking.

According to Customs and Border Protection data, the U.S. government’s average monthly seizures of fentanyl at the Mexican border have dropped by more than half— from about 1,700 pounds in 2024 to 746 pounds this year. WaPo admitted that, under Trump, enforcement has skyrocketed. But, it asked, if there’s more enforcement, why aren’t there also more seizures?

The complaint carries a certain childlike logic. It reminds me of how, in the 80’s and 90’s, corporate media used to loudly complain about all the incarcerations of offenders, given that crime rates had fallen so low. Why, they wondered, were we so hell-bent on locking people up, if there was hardly any crime?

To this day, they’ve never managed to put those two things together. Oh, sometimes they get this close, and then they get distracted by a dementia patient eating an ice-cream cone.

As far as the Washington Post was concerned, it’s almost like the last four fentanyl-fighting months never happened. Maybe it’s virus-induced amnesia? Fulminant narcolepsy? Either way, the paper diligently assembled a long and overly complicated litany of other possibilities, including theories like inter-cartel drug wars, precursor supply chain problems, and my personal favorite, possible lagging effectiveness of leftover Biden policies.

You have to hand it to them for their tenacity and creativity. Anything but admit Trump is winning again.

Have a wonderful weekend! We shall meet again, right here on Monday morning, as we power into June.

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