The sun rises in the East [China & AI]

Steve Lohr, China’s Leader Pitches ‘Openness’ in Push to Shape A.I.’s Future, NYTimes, July 17, 2026.

China’s leader on Friday laid out his nation’s bid to shape the path of artificial intelligence, casting China as a champion of an open approach to the technology and a trusted ally of developing nations in advancing A.I.

The remarks by Xi Jinping highlighted the importance that China’s top political and governmental leadership place on artificial intelligence. Mr. Xi’s speech did not mention the United States by name, but the message was clear: China plans to compete as the world’s other A.I. superpower.

Speaking at an A.I. conference in Shanghai, Mr. Xi said that “A.I. development should not be a solo performance by a single country but a symphony of global collaboration.”

He described open-source A.I. technology, in which much of the software can be freely shared and modified, as a “rare and historical opportunity” to spread the benefits of A.I. globally. The technology, he said, must be shared by developing nations or raise the threat of “new historical injustices.”

Moonshot open-source:

On Friday, a Chinese company, Moonshot, introduced a new model that it claimed performed as well as American models from Anthropic and OpenAI. The announcement of the model, Kimi K3, helped roil financial markets.

The U.S. companies, which have spent many billions of dollars creating their frontier models, do not share their technology freely. They have also accused the Chinese of pilfering their technology. And China remains well behind in the most advanced A.I. chips, a market dominated by Nvidia. [...]

In his address, Mr. Xi also said China planned to offer its A.I. technology and training to developing countries that were friendly to China. “We must uphold openness and win-win cooperation,” he said.

But how open?

But A.I., depending on how far and fast it progresses, poses a dilemma for the ruling Communist Party. How should it manage the rise of a technology that could one day be so disruptive that it could threaten its interests — and its grip on power?

There's more at the link.

The language of thought is not natural language

Hope Kean, Alexander Fung, Paris Jaggers, +6 , and Evelina Fedorenko, Evidence from formal logical reasoning reveals that the language of thought is not natural language, PNAS, 123 (28) e2520095123 https://doi.org/10.1073/pnas.2520095123, July 6, 2026.

Significance: Which cognitive mechanisms allow humans to reason logically, to understand whether a conclusion follows from the premises? Are they the same ones that allow the assembly of words into structured representations? Scholars have debated for millennia whether logical reasoning is inextricably tied to natural language, or instead relies on a distinct “language of thought” (LOT). Using fMRI in healthy adults and evaluating logical ability in individuals with severe aphasia, we find that distinct neural systems support language processing vs. logical (inductive and deductive) reasoning. These results suggest that, at least in mature brains, language processing does not underpin logical inference, perhaps due to the distinct representational format of the logical LOT.

Abstract: Humans are endowed with a powerful capacity for inductive and deductive logical thought: we easily form generalizations based on a few examples and draw conclusions from known premises. Humans also arguably have the most sophisticated communication system in the animal kingdom: natural language allows us to express complex and structured meanings. Some have therefore argued for a tight relationship between complex thought and language, postulating that reasoning, including logical reasoning, relies on linguistic representations. We systematically investigated the relationship between logical reasoning and language using two complementary approaches. First, we used noninvasive brain imaging (fMRI) to examine neural activity as healthy adults engaged in logical reasoning tasks. And second, we behaviorally evaluated logical abilities in individuals with extensive lesions to the language brain areas and consequent severe linguistic impairment. Our findings reveal that the language brain network is not engaged during logical reasoning, and patients with severe aphasia exhibit intact performance on logic tasks. Instead, inductive reasoning recruits the domain-general multiple demand network implicated broadly in goal-directed behaviors, whereas deductive reasoning draws on brain regions that are distinct from both the language and the multiple demand networks. Together, these results indicate that linguistic representations are neither utilized nor required for inductive or deductive logical reasoning.

H/t Daniel Everett.

Friday Fotos: Yesterday's breakfast [pancakes]

Perceptions of probability

Very cool graph show what people really mean when they use vague terminology describing the probability of an event. Source: https://t.co/uQQCRohYtS pic.twitter.com/FRx4xAPAW5

— Simon Kuestenmacher (@simongerman600) July 17, 2026

The Mystic Jewels and Matrix Miriam @3QD

I’ve got a new piece out in 3 Quarks Daily:

The Mystic Jewels, the Vatican, and Matrix Miriam

From the introduction:

A bit over a year and a half ago I published “Kisangani 2150: Homo Ludens Rising,” a science fiction yarn set a decade later and half way around the world from Kim Stanley Robinson’s New York 2140. Robinson gave us a post-climate change world with pretty much the same institutional structure of the current world. Things were a bit looser in some ways, the very rich were, if anything, even richer, and finance made that world go round. Robinson developed a rich plot in which the financial crisis of 2008 was replayed, but to a different denouement. The banks weren’t bailed out; they were nationalized. Our heroes celebrated by going to Mezzrow’s where they danced “to the tightest West African pop any of them have ever heard.”

My world. As a musician who’s played RnB, rock, and jazz in many clubs and private parties, that world is more familiar to me than the world of financial derivatives and AI-driven trading, where Robinson centered his story. I decided to take Robinson’s world, move ahead a decade, and center it on the activities of Homo ludens rather than Homo economicus. That gives us Kisangani in the center of the Congo Basin and in 2150.

But this story is much earlier than that. It takes place just a few years from now and is about how the Mystic Jewels started Matrix Miriam, their first in a series of projects to create a new architecture for artificial intelligence. A somewhat revised version will be incorporated into Chapter 6 of my book in progress, Play: How to Stay Human in the AI Revolution, where it will be mated with a revised version of “Kisangani 2150: Homo Ludens Rising” and some more fictional material.

This is thus is a work of fiction, and science fiction at that. Though the science aspect is a bit light in this piece, I expect it to get more intense as the story unfolds. You can get a glimpse of that in the working paper I developed from that 3QD piece, Kisangani 2150: Homo Ludens Rising, A Working Paper, in the section, “Discussion with Claude about digital doppelgangers,” pp. 10-14. The notion of a digital doppelganger is derived from Neil Stephenson’s The Diamond Age, where the protagonist, Nell, is gifted with an interactive book, Young Lady's Illustrated Primer, when she is four years old. This primer then guides her education into early adulthood.

I am imagining that in the late 22nd century everyone is gifted with a similar resource which is available to and even accompanies them throughout their life. The relationship is so intimate that the doppelganger is in effect a person’s Mirror. But, what happens to the Mirror when the person dies? I haven’t worked that out, but I imagine that it persists for it is (effectively) immortal. I’ll be doing that in that book, Play: How to Stay Human in the AI Revolution.

Governing Agentic AI

Rajagopalan, Shruti, GOVERNING AGENTIC AI: WHY LEGAL PERSONHOOD IS NEITHER NECESSARY NOR SUFFICIENT (March 05, 2026). Available at SSRN: https://ssrn.com/abstract=7127038

ABSTRACT: AI agents now transact, publish, and act on external systems without contemporaneous human approval, creating new regulatory challenges. A growing literature has responded with proposals for legal personhood. This Article argues that personhood is neither necessary nor sufficient, shifting the question from status to enforcement.

The Article first shows that for two millennia, nonhuman legal personality, from the Roman universitas to the corporation, the Hindu idol, the waqf, and the river, has operated through human officeholders the law can locate, question, prosecute, and replace. Agentic AI inverts that design, exercising practical agency without legal status, sometimes with no identifiable human in the responsibility-bearing role.

The Article then sorts deployments into three categories: first, where one firm builds and deploys the agent; second, where the developer and deployer are separate but known; and third, where there is no identifiable developer or deployer.

The Article stress tests each agent deployment category against five liability doctrines: agency law, products liability, enterprise liability, negligence, and strict liability. It demonstrates that each fails at different points in the third category for the same reason: the absent responsibility-bearer. Bare personhood would supply a caption without a representative, assets, or a mechanism for cessation.

Finally, the Article assembles an alternative from regimes governing aircraft, ships, drones, driverless cars, and motor carriers. It develops a six-layer stack— registration, identification, verification, financial responsibility, lifecycle traceability, and suspension—so a responsibility-bearer can be identified, liability imposed, and the activity suspended. These layers place the human back at the end of the chain.

H/t Tyler Cowen

Canada's revenge: Wildfire smoke over New York City

Democratic socialism, American style: Douthat interviews Bashar Sunkara

Ross Douthat, A Vision of a ‘Society Without Capitalism’, NYTimes, July 16, 2026

Democratic socialists are having a moment. But can they actually remake the Democratic Party — and the American economy — in their image? My guest today, Bhaskar Sunkara [founding editor of Jacobin], WLB, is a longtime democratic socialist, and he makes the case that socialism has a universal appeal that transcends our current politics and will ultimately triumph against capitalism.

Well into the interview, Bill of Rights socialism:

Douthat: So you’re saying that if there’s a socialist contract with America, it does not promise collectivization and a one-party state?

Sunkara: I think we believe in a Bill of Rights socialism.

Douthat: So what is it?

Sunkara: There’s an immediate set of demands that you could call us attempting to bring about doses of socialism within capitalism.

This comes in the realm of decommodification of certain goods, providing them as social rights instead of them being dependent on your ability to pay.

Health care in America is partially decommodified. If you’re elderly, if you’re very poor, if you’re a child, you’re going to have guaranteed access to health care. We want to see that extended.

Same thing with things like Social Security and certain other benefits, or an expansion of the welfare state — not unlike Norway.

I also would go further and say that even within capitalism in the here and now, there are sectors of the economy that I would like to see greater state control of. In the old language of the left, we would call it the commanding heights of the economy, but even things like rail — there are benefits to selective nationalization, particularly of natural monopolies.

That vision right there of socialism within capitalism, could be true of a lot of social democrats.

So beyond that, the question is: Why would you go about calling yourself a democratic socialist? For me, I call myself a democratic socialist because I actually believe in a socialism beyond capitalism.

I actually do believe in an economy built on the idea that workers should control their workplaces and on this more radical vision of a society without capitalism, even if it still has a motor needed for investment and for efficiency gains and growth and so on.

Housing:

Douthat: OK. But those people in Queens who you mentioned, they’re concerned about housing, right? Is the leftward view of what housing policy should be for the Democrats, going forward?

Sunkara: I think everyone can see, across the political spectrum, that there’s a huge problem with housing construction in the U.S.

So Zohran’s policy, for example, in New York, is very heavily built around upzoning and making it easier for developers to build, and I think people agree with that.

But beyond that, I think on the left, we point to successful examples around the world of public housing being done right. We think at least part of the construction needs to be public housing. We also need to maintain and expand existing units.

I think that’s the room for the state to step up and do more things. But I think these solutions are largely, first and foremost, on the supply side. Then beyond that, we do believe in certain stabilizations and other things.

Douthat: Rent stabilization, meaning rent control or —

Sunkara: Rent control, which can be designed well. It could also be designed poorly.

But you could imagine, for example, telling landlords: “We’re going to clear the way. We’re going to allow you to create this big housing development. We’re going to fight against the interests of local homeowners, and you build your big piece of housing. But after 30 years, after you have a reasonable return on investment, that unit is going to have some degree of rent stabilization,” for instance.

That, to me, is a perfectly common sense, economically coherent vision for housing. I know there’s lots of talk on the left and in the Democratic Party about the debate over abundance, but fundamentally, any form of social democracy is grow-give.

There needs to be a motor for economic investment. There needs to be profitability in order to have something to redistribute. The added component that I would say is an important part of a socialist agenda is making sure that there are strong unions in workplaces that can advocate for higher wages even before the state gets involved with redistribution.

A.I.:

Douthat: What about A.I.? Bernie has taken some pretty strong stances, I would say. He has sort of staked out a position as the Democratic politician most open to both doomer narratives about A.I., but also most enthused about the prospect of strong government intervention.

What is the socialist position on the A.I. industry right now?

Sunkara: I think there’s a host of different socialist positions. I lean more on the side of just seeing it as any other technology. Companies are going to invest in new technologies. The economy is going to change. We’re going to need to adapt and figure out how to regulate it.

Obviously, any changes that we do, any regulation we need to do, need to make sense in an international context too.

It doesn’t make sense to tank certain U.S. companies if there’s going to be other companies creating the same disruption that are coming from other parts of the world.

But I think this gets to the level of policy where there’s legitimate debates. I think the idea which has been touted by figures as varied as Bernie Sanders and Steve Bannon is of the U.S. government owning a stake in major A.I. companies.

It makes perfect sense, too. But, fundamentally, we have to respond to a dynamic economy in which there’s always going to be new technologies, there’s always going to be new wants and needs, and new goods and services, and we need regulation that’s able to be flexible and adapt with changes. [...]

There needs to be a motor for economic investment. There needs to be profitability in order to have something to redistribute. The added component that I would say is an important part of a socialist agenda is making sure that there are strong unions in workplaces that can advocate for higher wages even before the state gets involved with redistribution.

What of capitalism?

Douthat: But just pulling back, I feel like we’ve danced around this a little bit, so let me just ask it directly: Is democratic socialism compatible with capitalism?

Sunkara: In the long term, no. We’re anticapitalist. We want a world beyond capitalism. But in the short term, while we’re within a capitalist economy, of course, we need firms that are profitable, that are providing employment, that are providing taxation. So I think to govern in the short term as social democrats, we need profitable firms.

But in the long term, you know, I don’t hide my desire that I think the economy should be socialized, even if I think in the socialized economy, there needs to be a role for markets and also a role for worker-controlled firms to be able to meet people’s needs and provide new goods and services.

Douthat: What’s the distinction you make between capitalism and markets then?

Sunkara: Well, I think markets existed before capitalism. Capitalism is a regime of property ownership that says that as an individual capitalist or as a corporation, we own this private property and we use this private property to employ people and to produce goods and services.

And in my vision of a just society, of a socialist society, that private property would be controlled by ordinary workers who would get their financing from public banks, who would still operate with hard budgets. They would still need to meet goods and services and meet their payroll obligations and things like that.

But you don’t have a class of people who, as individuals, control investment decisions.

There's much more at the link.

But what is cross-entropy? | Compression is Intelligence Part 2

Where the loss function for training LLMs comes from.
Job opportunities aligned to this audience: https://3b1b.co/talent
Early views and other perks for supporters: https://3b1b.co/support
Home page: https://www.3blue1brown.com

Manim animations by Aaron Gostein and Grant Sanderson
NanoGPT animation by Clayton Rabideau
3d black-box model by Paul Dancstep
Music by Vince Rubinetti

Timestamps

0:00 - Language trees and zipping
3:02 - Recap optimal codes
5:20 - Defining cross-entropy
8:26 - Intuition and examples
12:59 - Application to language trees
14:55 - Pre-training LLMs
20:38 - What makes this loss function best?
26:13 - Distillation
30:12 - 3b1b Talent
31:35 - KL Divergence

Attention and error predition in thalamocortico circuits

Happy to share our new pre-print "Attention reshapes the information dynamics of thalamic and cortical prediction-error learning" led by the great Juho Äijälä, with @happieheads, @Kai_J_Miller, @dora_hermes, @drrobinince, @ABlenkmann , @TrikBek, Max Garagnani. Thread below👇 pic.twitter.com/dBJBM1VEnE

— Andres Canales-Johnson (@canalesjohnson) July 16, 2026

Follow the link to see the full thread. Here's the article's abstract:

Prediction errors (PEs) drive perceptual learning by updating internal models of the sensory environment, yet it remains unclear how attention reshapes their representation across distributed thalamocortical circuits. Using intracranial stereoelectroencephalography (sEEG) from 17 patients performing a roving auditory oddball task under attended and unattended conditions, we quantified PE encoding using mutual information and co-information to capture redundant and synergistic PE representations. Attention modulated PE encoding in both the thalamus and the temporal cortex, but with distinct informational dynamics. Thalamic encoding showed a stable reduction of PE information during distraction, consistent with state-dependent thalamocortical gating. In contrast, the temporal cortex expressed two opposing learning trajectories during attended listening that converged once attention was diverted, revealing distinct cortical learning regimes rather than a uniform attentional effect. Attention further reorganized the informational content of cortical PE representations by altering the balance between redundant and synergistic information. A biologically constrained neural network showed that attention-dependent changes in inhibition and long-range connectivity reproduced these dynamics through Hebbian learning. Together, these findings suggest that attention regulates predictive learning not simply by changing the strength of PE responses, but by reshaping how distributed thalamocortical circuits represent and integrate sensory evidence over time.

Meditation facilities

Killing the NSC with Julia Curlee

YouTube:

Wherein Ben and Mike Feinberg welcome Julia Curlee, former CIA analyst and NSC staffer, to discuss the Trump administration's destruction of the National Security Council.

An interesting discussion of the functioning of a relatively small government agency, roughly 200 people, by examining what happens when the agency was gutted early in the 2nd Trump administration. 

Note: The opening monologue, the first 3 to 5 minutes or so, is optional. Yes, I know, it's a "revolutionary" feature of this "revolutionary" approach to TV, but come on, gimme' a break. 

Henry Farrell on "The political economy of billionaire derangement"

Henry Farrell, The political economy of billionaire derangement, Programmable Mutter, July 15, 2026.

He opens with two somewhat different quotes about billionaires, Tyler Cowen more or less in favor of them and Tim O’Reilly deeply skeptical of them. He suggests we breed them together:

To be clear: this hybrid would be notably different to Tim’s argument, and likely actively objectionable to Tyler. I alone am to blame. But surprisingly, there is inadvertent support for some of its key elements from Peter Thiel, who is a surprisingly valuable chronicler of the conditions that give rise to billionaire derangement, as well as a living example of it (the Antichrist is here!).2 Here, I’m drawing both on lectures that Thiel gave at Stanford, as summarized by his amanuensis Blake Masters, and the resulting co-authored book, Zero To One. These sources have a lot to say about the connections between entrepreneurship, kingship, and personal eccentricity.

The conclusion I draw is that the forces that Tim identifies, combined with specific aspects of the political economy of Silicon Valley, help explain the derangement of certain Silicon Valley billionaires and their epigones. Old style princes were notorious for their tendencies to deranged behavior, which came not just from their inbreeding, but their power, and the unwillingness and inability of others to contradict or check them. So too, modern princes.

Not too long ago, many people, including Tyler, hoped that the advance of classical liberalism would go hand-in-hand with the growing power of tech billionaires, advancing both causes at once. Now, politically influential tech billionaires have visibly lost contact both with reality and with anything that could plausibly be described as classical liberal values. See the screen shotted quote above. Rather than making snide asides about billionaire derangement syndrome, it might be time for such people to confront what actual billionaire derangement means for the ideological straddle that they have relied on for so long. That is even more so, in a world where markets as well as market-makers are being devoured by the passions.

To summarize the particulars of my theory: Thiel’s lectures and book provide good, if incomplete evidence that the princely passions described by Hirschman didn’t disappear, but went underground. Commerce and power were fused into a new ideology of entrepreneurial virtù that became highly influential among the founder community in Silicon Valley. This combined with Silicon Valley’s (and popular culture’s) tendency to connect genius with eccentricity, not simply selecting people who seemed strange, but compounding their strangeness through self-reinforcing feedback loops. Finally, this all happened in an intimate social environment of founders and funders. Billionaires know each other and measure themselves and their success against those they consider peers, in a dense entangled clique that commingles high degrees of mutual influence with rivalries and jealousies.

Farrell then goes on to quote Thiel’s book at some length, analyzing while going along. And so:

In short then, Thiel - both as reported by Masters and in collaboration with him - suggests that Silicon Valley is a place where being a founder is tantamount to being a king. You have a greater chance of succeeding if you are weird, and if you succeed, your weirdness will likely feed upon itself in feedback loops of positive reinforcement. Finally, it is a closely interconnected social system where the key people are conjoined in a dense tangible clique. They observe each other all the time, and are observed by others for cues of what you need to do to become a made man. [...]

SpaceX perhaps marks a culmination of the kingly ideal, a moment in which, as Tim puts it, someone like Musk can “raise enormous amounts of capital while freeing himself from any restraints from those who provide it, so that he can spend the proceeds on Mars, humanoid robots, artificial intelligence or whatever next satisfies his ambition.” But it is also the moment in which someone who is visibly profoundly disturbed has briefly become the world’s first trillionaire. And it is one in which others want to copy him.

And then a bow to Keynes’s “animal spirits” in the market place:

I’ll finish by noting that this is just one aspect of a greater change. Deranged billionaires like Musk and Thiel are both partly responsible for this transformation, and notable symptoms of it. Still, they are not the whole of it. The reason that the SpaceX IPO temporarily succeeded, even though the numbers make no sense whatsoever, is that investment markets too are ruled by vibes. Tyler’s co-blogger, Alex Tabarrok, devoted years of his life to making the case for prediction markets, arguing that they would distill market wisdom into a more general source of knowledge on a multitude of topics. Now they are here, but all too often it’s spirits, not wisdom, that they seem to be distilling. Even more so for crypto. Matt Levine makes a joke about “Bleebzorx Tokens” to explain the worthlessness of memecoins, and someone else invents Bleebzorx Tokens to make a tidy profit.

There’s more at the link.

Riding the wave (Gen AI is an engineering disaster, not quite)

https://t.co/FJ3nRKbBEp

— Bill Benzon, BAM! Bootstrapping Artificial Minds (@bbenzon) July 15, 2026

Street view with shadows and sun