AT THE end of January, $1 trillion was wiped off the value of America’s leading high-tech companies – the so called ‘Magnificent Seven’ – following the announcement that a tiny Chinese artificial intelligence (AI) company DeepSeek had developed a powerful AI model that outperformed all that US tech companies had produced and at a fraction of the cost.
Worse still for the likes of Meta and Google, DeepSeek released its computer code for the model as free downloads.
The long held belief in the absolute supremacy of American capitalism in AI and all technological advances has been shattered not just by DeepSeek but by the massive advancements being made by China which have overtaken anything developed in the US.
On Sunday, the Observer newspaper in an editorial pointed out that Chinese electric vehicle carmaker BYD last week unveiled new charging technology that it claims is capable of charging an electric car in just five minutes, the time it takes to fill a car with petrol.
BYD has overtaken Elon Musk’s Tesla to become the world’s largest electric vehicle manufacturer, and this new breakthrough in battery charging technology could be about to ‘bury’ Tesla.
The Observer also commented that BYD did it ‘on the cheap’ reportedly getting subsidies from the Chinese government worth about a quarter of the $15 billion that Musk’s Tesla got from the US authorities.
Musk and his fellow multi-billionaires are happy to take a chainsaw to the jobs of hundreds of thousands of workers employed by the federal state while insisting this same ‘bloated’ state carries on lavishing billions on their own companies to produce technologies that have been completely superseded by China at a fraction of the cost.
On Sunday, the Telegraph newspaper published an article that highlighted the impact that this massive increase in the rate of China’s innovations has on US companies.
The article, by Matthew Lynn headed ‘The West is losing the tech race and Musk knows it’, addresses the question of why ‘the libertarian, free market Elon Musk has not spoken out against Donald Trump’s tariffs on imports into the US’.
The answer, he writes, ‘is staring us all in the face. Tesla is being beaten hands down, and it needs the protection from better Chinese products’, pointedly, Lynn continues, ‘and so do many of the West’s other industrial giants.’
The answer for Musk and his fellow corporate bosses is to hope that president Trump’s trade war on US capitalism’s rivals across the world will provide them with some protection from being swamped by superior and cheaper products. Lynn says without the protection of tariffs and quotas many US and European companies will not survive.
But any survival will be very short lived, Lynn writes, because behind the protective tariff wall, instead of turbo charging innovation, the chief executives of these capitalist giants ‘will simply bank the easy sales, and generous profits they can make behind a tariff wall, bank some massive bonuses, and let their competitiveness slide even further.’
While the major capitalist corporations are banking on hiding under Trump’s protectionist regime, US imperialism has another solution to its crisis through a war to crush a Chinese economy that, despite the distortions of the Stalinist bureaucratic leadership, is proving vastly superior to bankrupt capitalism.
Last Friday, the leading US newspapers carried the story that Musk had been invited to attend a top secret meeting to be briefed by the Pentagon on plans for a war with China. Trump and Musk both vehemently denied that he had been invited to this meeting.
The world economic crisis has created the conditions where capitalism is rapidly moving towards another world war in a desperate bid for survival, a war that holds the prospect of nuclear weapons being used.
In its death agony capitalism is on the brink of destroying humanity.
Only the working class have the power to put an end to capitalism and the threat of world war by taking mass action to bring down their capitalist governments and seizing power going forward to socialism.
This requires the building of parties of the International Committee of the Fourth International in every country to provide the revolutionary leadership necessary for the victory of the World Socialist Revolution.
