The Engineer's Veil

Bette member David M points out how unbelievably convenient the AI tech bubble is for the global rise of autocracy; claiming this is probably not a coincidence.

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Author’s note: Bette member David M has a background in science and technology. He writes periodic guest op-eds for Bette Dangerous.—hsc

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The Engineer’s Veil

By David M

It is hard to envisage a more apocalyptic scenario for the American economy than Trump’s second term.

Let’s touch on a few examples.

Expelling Labor

In California — by far the largest domestic producer of non-cereals — the workforce necessary for the 2025 harvest has been arrested or frightened off. Crops rotted in the fields. The economic damage was so devastating that Trump had to introduce a $12 billion farmer assistance program to prevent a flood of bankruptcies. If Americans thought their food prices were too high before, now items that don’t come in a cereal box will have to be imported.

It is vital to note that that farmer assistance program provided loans, not relief. Those farmers may not be bankrupt this year, but they were already in debt. Those laborers won’t be back, and those crops won’t be harvested next year either. Expect a rash of Chapter 7 filings.

But irony’s not dead. I recall in August of 2024 seeing endless pro-Trump billboards along the I-5. The people who paid for those billboards are right now in tears planning how they’re going to explain to their children how their inheritance turned from 10,000 acres of the best agricultural land in the world to a rusty pickup truck.

Farmers of the Central Valley have set a new high watermark for voting against their own self interest.

Denying Supply and Demand

Trump also loves to weigh in on commodity prices. He’s hardly the first president to do that, but it does not inspire confidence in the business community who have generally been steeped in the gospel of supply and demand. Most recently a friend gave me the run down on Trump’s post-Venezuela promise of $50 barrels of oil. My friend pointed out that maintaining a steady supply of oil requires enormous amounts of capital, and nobody is going to be investing in oil extraction infrastructure at that price.

Fostering Inflation

Throughout the often bounteous years of the Pax Americana the world enjoyed relative economic stability largely due to the actions of the US federal reserve. The Fed has certainly seen a great deal of criticism over the years for being tightfisted with the money supply while the typical American worker was struggling to land a job. Certainly that is the accusation parroted by endless politicians looking to deflect the blame for inevitable hard times. But nobody ever suggested we commit economic suicide by handing control over interest rates to politicians.

However, with Fed chair Jerome Powell facing a federal subpoena and Lisa Cook embroiled in investigations and lawsuits it is hard to imagine that the Fed’s much vaunted independence will survive this administration. And without a staid hand controlling interest rates the American worker can expect to see plentiful digits on their paychecks, but very few potatoes in their shopping cart.

Tariff Mania

As I recall, the rational for Trump’s vengeful tariff regime was to restore the American manufacturing sector. No sign of that happening. With the close of 2025 we see that job growth in the US was very nearly zero, the lowest non-recession result in decades. Hard to imagine that the domestic manufacturing sector is burgeoning without the creation of any new jobs. Has there been a quiet revolution in automation this past year? It looks like the populist fantasy of boundless employment remains just that.

Aside from the unprecedented monetization of the American presidency, the primary result of those tariffs has been a staggering bodyblow to America’s cut of world trade — not an enviable position in a highly globalized world where capital flows across borders in a heartbeat.

The Looming Spector of Default

Now that Trump has doubled down on his conviction that Greenland should be a US territory, the Europeans, who hold a considerable share of America’s $38.4 trillion debt, are talking about divesting. What happens if American can’t find another lender?

No big deal, that simply leads to rise in interest rates. Except, wait... isn’t there a critical interest rate? The critical rate is the interest rate at which the entirety of America’s budget goes to paying nothing but the interest on its debt. Economists estimate that rate to be about 5 or 6%. Instead of America comfortably servicing its debt, with a little left over for roads and sewers and the world’s largest military, above the critical rate there’s no money left for anything else. Unless, of course, America were to default.

Currently, still enjoying a remnant of the world’s trust, America pays about 3.4%. Does it seem impossible that threatening to invade Greenland might encourage the Europeans to choose to shed American debt in retaliation, and in a world very short of alternative trillionaire lenders, that rates might rise a mere 2%? Suddenly our farmers’ bankruptcies seem merely tragic.

Apocalypse Invisible

All my life, I’ve marveled at the skittishness and cowardice of investors. I was always told you should buy low if you want to make money. Yet consistently we see a flood of divestiture every time the market sneezes and I’ve enjoyed the occasional bout of luxury doubling down at such opportunities. But now? There’s never been a scenario providing such scarce grounds for optimism. So how is it that these same investors are so ebullient in the face of the current onslaught of bad news?

The answer is that they are drunk with the promise of AI riches. Nobody can envisage seeking shelter while there’s still gold showering down from the sky. In every fundamental the market is staggeringly weak: consumer confidence, inflation, trade volume, political stability, profit projections, energy supplies, etc. Investors should be fleeing, and they probably are. But we can’t see any of this because it is obscured by an massive bubble in AI related startups.

The Engineer

If you were going to engineer a global economic apocalypse on the scale that we are observing, and you wanted the plan to proceed undiscovered, you would make sure to provide a veil so that as the fundamentals dissolved it wasn’t immediately reflected in index prices. A tech bubble would be an ideal solution.

In fact, nobody is trying to engineer a global economic apocalypse. It is simply an unfortunate byproduct of the global rise of autocracy. There’s no disputing that autocracy is on the rise, and that the market is enjoying a bubble, which is a lovely coincidence, but is it just serendipity? Or did someone engineer this transition from a world dominated by freedom loving democracies to one dominated by fascists?

I don’t believe for second that Donald Trump is a fool, but he is no engineer. Our fascism implementation engineer would certainly have been aware that investors are skittish folk and economic signals like the ones we are seeing would lead directly to panic, a devastating recession, and potentially global popular revolt. That result is inevitable. The trick would have been to forestall the recession long enough that fascism would already be well entrenched and draconian counter-measures would be de rigour. Recent events in Minneapolis demonstrate that this may already have been achieved.

The AI bubble is that perfect veil. It should come as no surprise that the CEOs of OpenAI (ChatGPT) and xAI (Grok) are as fascist as they come. Somebody timed this crucial phase of the rise of autocracy to coincide with this entirely predictable AI bubble. And you wonder why we call it techno-fascism?

We should stop them.

David M for Bette Dangerous

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