AI investment has a ways to go to rival other American industrial revolutions
Just how much are we spending on AI?
Compared to other massive infrastructure projects, AI is the sixth largest in US history, so far.
World War II dwarfs everything else at 37.8% of GDP. World War I consumed 12.3%. The New Deal peaked at 7.7%. Railroads during the Gilded Age reached 6.0%.
AI infrastructure today sits at 1.6%, just above the telecom bubble’s 1.2% & well below the major historical mobilizations.
Companies like Microsoft, Google, & Meta are investing $140B, $92B, & $71B respectivelyin data centers & GPUs. OpenAI plans to spend $295B in 2030 alone.
If we assume OpenAI represents 30% of the market, total AI infrastructure spending would reach $983B annually by 2030, or 2.8% of GDP.
To match the railroad era’s 6% of GDP, AI spending would need to reach $2.1T per year by 2030 (6% of projected $35.4T GDP), a 320% increase from today’s $500B. That would require Google, Meta, OpenAI, & Microsoft each investing $500-700B per year, a 5-7x increase from today’s levels.
And that should give you a sense of how much we were spending on railroads 150 years ago!
tomtunguz.com/llm-impact-gdp…
Ben Thompson is a fraud, trying to be clever comparing the AI bubble to the railroads, instead of 90s internet, bc no one alive can refute it.
Just how much are we spending on AI?
Compared to other massive infrastructure projects, AI is the sixth largest in US history, so far.
World War II dwarfs everything else at 37.8% of GDP. World War I consumed 12.3%. The New Deal peaked at 7.7%. Railroads during the Gilded Age reached 6.0%.
AI infrastructure today sits at 1.6%, just above the telecom bubble’s 1.2% & well below the major historical mobilizations.
Companies like Microsoft, Google, & Meta are investing $140B, $92B, & $71B respectivelyin data centers & GPUs. OpenAI plans to spend $295B in 2030 alone.
If we assume OpenAI represents 30% of the market, total AI infrastructure spending would reach $983B annually by 2030, or 2.8% of GDP.
To match the railroad era’s 6% of GDP, AI spending would need to reach $2.1T per year by 2030 (6% of projected $35.4T GDP), a 320% increase from today’s $500B. That would require Google, Meta, OpenAI, & Microsoft each investing $500-700B per year, a 5-7x increase from today’s levels.
And that should give you a sense of how much we were spending on railroads 150 years ago!
tomtunguz.com/llm-impact-gdp…
Really interesting charts and details given current sentiment in markets around AI spend roi and circular money flow.
Just how much are we spending on AI?
Compared to other massive infrastructure projects, AI is the sixth largest in US history, so far.
World War II dwarfs everything else at 37.8% of GDP. World War I consumed 12.3%. The New Deal peaked at 7.7%. Railroads during the Gilded Age reached 6.0%.
AI infrastructure today sits at 1.6%, just above the telecom bubble’s 1.2% & well below the major historical mobilizations.
Companies like Microsoft, Google, & Meta are investing $140B, $92B, & $71B respectivelyin data centers & GPUs. OpenAI plans to spend $295B in 2030 alone.
If we assume OpenAI represents 30% of the market, total AI infrastructure spending would reach $983B annually by 2030, or 2.8% of GDP.
To match the railroad era’s 6% of GDP, AI spending would need to reach $2.1T per year by 2030 (6% of projected $35.4T GDP), a 320% increase from today’s $500B. That would require Google, Meta, OpenAI, & Microsoft each investing $500-700B per year, a 5-7x increase from today’s levels.
And that should give you a sense of how much we were spending on railroads 150 years ago!
tomtunguz.com/llm-impact-gdp…
The railroads were a big deal.
It’s important to remember AI is still just at 1.6%, just above the telecom bubble.
We are moving into very consequential times. Let’s go!
Just how much are we spending on AI?
Compared to other massive infrastructure projects, AI is the sixth largest in US history, so far.
World War II dwarfs everything else at 37.8% of GDP. World War I consumed 12.3%. The New Deal peaked at 7.7%. Railroads during the Gilded Age reached 6.0%.
AI infrastructure today sits at 1.6%, just above the telecom bubble’s 1.2% & well below the major historical mobilizations.
Companies like Microsoft, Google, & Meta are investing $140B, $92B, & $71B respectivelyin data centers & GPUs. OpenAI plans to spend $295B in 2030 alone.
If we assume OpenAI represents 30% of the market, total AI infrastructure spending would reach $983B annually by 2030, or 2.8% of GDP.
To match the railroad era’s 6% of GDP, AI spending would need to reach $2.1T per year by 2030 (6% of projected $35.4T GDP), a 320% increase from today’s $500B. That would require Google, Meta, OpenAI, & Microsoft each investing $500-700B per year, a 5-7x increase from today’s levels.
And that should give you a sense of how much we were spending on railroads 150 years ago!
tomtunguz.com/llm-impact-gdp…