Not a chance. Were it just the tariffs, the recession would be quite small. The tariffs might even be cancelled if the SCOTUS remembers to do it's job.

But it's not just the tariffs.

The US economy is currently being kept afloat by AI R&D and infrastructure spending. It's stock market kept alive by 7 companies who are all neck deep in AI hype.

This not only disguises the malaise in the rest of the US economy, it's a bubble. Everyone knows it. Nvidia's the only one making any money and even they are now relying on vendor financing and other such red flags. Even one who believes that the technology of AI is here to stay, has to face the reality that it's not a golden goose of infinite dollar bills.

We're looking at something that's going to be at least as bad as the Dotcom crash. 'At least' because while the bubble is of only comparable size, other conditions are much worse.

Trump is trying to seize the fed. Big Tech is tearing the copper wiring out of it's own walls to keep AI going a little longer, and their plans for cutting costs is to dramatically increase H1Bs and outsourcing. (One wonders if there might be a non-economic reason behind this, given it's one specific country they're seeking to hire from >.>)

And underneath it all: A timebomb. Much, much, much more of consumer spending in 2025 is from pensioners than it was in 2000. When the stock market eats a 50% loss and stay there for a decade, those pensions will be cut dramatically. This drives down consumer spending, in turn driving down the stock market, a vicious cycle.

The problem is that the Trump Administration is plainly incompetent in handling these matters. There wouldn't be this shitshow of sudden haltings in postal services to the US if they'd done the normal thing of announcing the changes with an appropriate lead time for businesses to adjust, rather than suddenly implementing it alongside the constant ping-ponging between yes-tariffs and no-tariffs.

The EU has 450M (+80M for UK & similar non-eu countries that are likely to follow the EU on such regulations) population to the US' 350M.

The moment the likes of Google, or Meta, or Microsoft, or whomever else leave the EU, they immediately create a market gap. A market gap that will then in short order be filled with a European company that, because of the population sizes, has a notable comparative advantage to the US tech company.

+ As much as HN's readership loathes to admit it, regulations like this are "Good, Actually". Google's monopolist practices are bad for both advertisers and services showing ads. Any would-be competitor that arises from Google leaving the market would, by virtue of being forced by law to not be so shitty, be the better option. (And yes, this does also apply to pretty much all of the other big tech regulations as well.)

Like, c'mon. "Monopolies bad" is capitalism 101. Even the US' regulators thought Google was going too far.

Europeans are much poorer on average though, so actual revenue figures are rather the inverse of these population figures (they actually skew much more to the US than that, but anyhow).

Some people are so poor that all they have is money.

Many pennies together add up.

My hot take is that if they want to leave, then they can fuck right off. If you think your desires, profits, or business practices extend beyond democracy, then I don't need your business. Private enterprise should support and assist democracy, not the other way around (there's obviously some leeway there, but by and large).

A lot of it is a because the US brands are more recognizable and cheaper (due to dumping) and grow faster (due to the USA's VC glut).

IIRC a company like AirBNB was started in Europe, and was slowly growing, and couldn't get investment because "who would want this?" and then AirBNB was created, and then arrived in Europe, and they still couldn't get investment because "who wants a ripoff clone of AirBNB?"

The standard model for tech firms has been to run at enormous losses to push competition into bankruptcy or steal their users through subsidized service.

No European social media company could compete with e.g. Twitter, running at a loss for TWELVE years.

In more recent years, it's things like Uber. Subsidizing ride costs to crush existing taxi services & European taxi startups.

This is all, ostensibly, illegal under international law. You can't do it for cars or commodity goods. It's just not been enforced on the tech industry.

Some resources would definitely help me out here!

Also I think that I doubt how enforceable this is in tech industry as for the most part, they are selling a service and each service is different and thus have different price points and therefore the company should have the ability to decide prices technically.. so if they want to sell at a loss, theoretically nothing stops them from selling the service at a loss.

But I feel like the same logic applies to commodity goods. If two parties want to decide that they want to buy/sell at lower prices, why does the govt. interfere b/w them? Does this not impact their rights/freedom?

The actual legal mechanics are complicated; "Illegal under international law" here specifically entails "WTO agreements allow retaliation in response to dumping".

> and why I couldn't do it for cars or commodity goods.

Specifically, it's more enforced. Governments care about their conventional industry. The way this'd look is say, China providing state subsidy to certain industries in order to artificially lower the price of those goods, making them cheaper than US-based industry could produce, with the specific intent of driving US industry out of business.

Just googling "predatory pricing" and "dumping" will get you examples.

> Also I think that I doubt how enforceable this is in tech industry as for the most part, they are selling a service and each service is different and thus have different price points and therefore the company should have the ability to decide prices technically.

The problem for tech is this difficulty in assessing "real value" and the assumption that running at a loss for extended periods is "normal" for tech companies.

For a clear-cut example, consider Uber, who paid drivers more than they charged the passenger(s). This is obviously predatory. Uber has tricks like moving insurance/maintenance to the driver's wallet, but a taxi can't be cheaper than what they pay the driver.

> why does the govt. interfere b/w them? Does this not impact their rights/freedom?

It does impact their freedom, but the reason why the government intervenes is long-term health of the market.

Things like a 'firesale' because you're going out of business, or moving to a new warehouse, etc, are fine. A single store (even a big-box one) going out of business won't crush the entire market and it's only of short duration.

The problem is that dumping/predatory pricing is a strategy to maintain a monopoly. (Or in the cases of extensive investment funding, build one)

Again, consider something like Uber (but the same applies to any "rental"/gig-economy company). They sell rides below cost paid for by their huge pile of investment money, no other taxi company can compete. All the competing taxis go out of business. Uber can now raise the prices to obscene levels and cash in.

Whenever someone tries to start a new taxi company, it'll be small and local, so Uber just lowers their ride prices in that region again until they go out of business. And because they're small they don't have as much money as Uber so they'll go bankrupt first. Uber keeps the monopoly.

Such monopolies are long-term bad for the entire economy.

On an international level, it's China and steel again. China subsidizes their industry, industry in other countries can't compete and goes bankrupt, China can now raise their prices.

It's laughable that tarriffs and import taxes only apply to physical goods. If the EU had even an ounce of self-respect, the second the US came out with the tarriffs, they would've come out and said:

"We think this is a fantastic idea by Mr. Trump. Aligned with his views, we are instituting accompanying digital tarriffs to fix the digital trade defecit. We're sure he'll agree that the trade balance should be corrected in both the physical as well as digital worlds".

And that's why the US is so mad at the likes of Brazil - finally, after decades of getting rinsed, countries are starting to take (wholly insufficient) measures here and rightly instituting the equivalent of digital tarriffs.

(It's probably more about keeping up politicians' stock market investments though)

The real problem is that the US would leave Ukraine and Europe alone against Russia which has a real chance of turning into WW3. Most likely this isn’t discussed in the US media but feels like every week some notable politician or high-ranking military is warning that Russia will invade NATO after Ukraine. Trump knows our weakness and is squeezing hard.

The mood here in eastern Europe is very much that we’re talking when, not if, Russia attacks us.

VC funding (I think) drives on monopoly creation. Maybe that's why we were seeing a huge amount of VC funding in AI because they think that they want to monopolize "intelligence" this time so its the end goal as they are trying to monopolize the means towards creation...

I really want to learn how US got VC trapped. The whole economy's system issue arises from VC. Like, AI hype started from VC spending billions which then justified the absurd AI growth in things like magnificent 7 on stock market.

We really have these billionaires pulling quite deals which secretly shape the world to a much larger extent and they don't do it because of some evil reason but a plain old reason: money.

But the fact that all they care about money makes the companies inside VC justify doing evil things because morality isn't the end goal, helping isn't the end goal. Its money and more money and even more money. Guess what? Exploitation pays the most short term and these VC's prefer short term too.

VC and corruption seems to be the worst issues that I think really influence way way more of the world secretly and thus making "democracy" as one HN user pointed out on a different thread, a "copium for the masses"

This is plainly untrue if you're talking about tech beyond the mag-7 sized supergiants.

> Regulation may be good, but understand, actually, recognize, that it is also suffocating. People bragging that they have no weeds in their fields, when they have no fresh crops either....

And yet it is the tech giants in the US, oh so praised for their size, that are the "weeds" in many regards.

What good is Google when it's reliant on an advertising monopoly itself built entirely on monopolistic and fraudulent exploitation of the rest of the economy.

What good is Amazon when it's reliant on crushing all other retail and local manufacturing?

I give them money, and in return I get stuff that "all other retail" failed to provide.

That's good.

Amazon crushed all other retail in the first place and therefore, now all other retail can't provide some stuff and you buy them from amazon

That isn't good.

Man I am thinking of this as an ouroboros. Amazon got big because they crushed all other retail and they crush all other retail because they are big.

I think that the ouroboros that I am talking about should be known as the monoboros (get it? I am trying to have some fun by mixing monopoly and ouroboros, I hope you don't mind it)

Or just call this ouroboros a monpoly, man. it hurts me sometimes that you can't bring change in this world because of the way the world is right now and that bad things can happen in this world and its far far from perfect. I don't get how you guys or even anyone stays optimistic, I really wish to be a optimist logically but I can't come to that conclusion other than the fact that hey I run on emotions and bad emotions lead to bad things happening for me personally so I need to shut down bad emotions just so that they happen better for me. But that seems a little like running away from the truth. Should I feel okay running away from truth?

I dunno, I think it's easy to forget just how bad it used to be. I'll take "cheap junk" I can get off Amazon for a few bucks even today.

1) As much as JD Vance and his puppetmaster wishes they were the president, they are not. The tech fascism isn't happening, just regular kind. What you're seeing here with the "deregulation" is just a big fat scoop of plain corruption. Give Herr Führer a nice golden trinket and he deregulates your industry or tariffs your competitors.

2) While they are deregulating heavily, there's absolutely zero sense of "Small Government" going on. You need only look at the oppression of groups like LGBT people. There's no bigger government than controlling which toilets people use or inspecting the genitals of children if they want to participate in sports.

And outside of LGBT rights, just look at the whole situation around Israel. Literal secret police going around arresting people for non-violent protest and simple thoughtcrime.

They are not "illegal aliens".

You have to carry passport everywhere only in police states like USA or Russia.

I've lived and worked in countries in South America and Africa and if, as a foreigner, you are stopped (which happened randomly on roads and in cities) and don't have your papers, you could be deported. It was recommended by the US State department to carry a certified copy of my passport and visa information.

The Trump administration has been in court several times already for trying to deport people who, not only are not supposed to be deported, but whose deportation would and is be illegal.

Even if they're released, ICE is known to be abusive and inhumane in it's detention practices.

Your response reeks of "they'll be proven to be illegals soon enough, and then all the abuse is fair game". Disgusting.

It's a matter of scale and efficiency. Housing also adds (full-price) customers new taxpayers. A major problem with housing development is that low density (e.g. single-family zoned suburbs) are net-negative contributors. (But this effect is primarily seen with infrastructure like roads)

> Any model you do that tries to prevent this is essentially rent stabilization for early members.

The problem with datacenters is twofold:

1) It's a demand-shock. Because of the rapid rollout of datacenters, energy production and transmission capacity simply can't scale up. This causes prices to spike locally.

2) 'Industrial' electricity like this tends to pay very cheap rates, leading to residential electricity customers subsidizing them. Especially as such industry tends to be given high tax & other incentives.

> Any model you do that tries to prevent this is essentially rent stabilization for early members. And that has a pretty good track record of not being a good idea.

A question here is whether or not we're in a datacenter construction bubble. (To anyone who says we're not: Nvidia's stock price has soared more than Cisco's during the dotcom bubble.)

If you're in charge of a major electricity company, are you going to sign off on major expansion investments right now, knowing that it will take 5-10 years?

A lot of these datacenters are not owned and operated by Big Tech itself, but instead disposable companies like CoreWeave. If there's a bubble, it'll pop, and these companies will just go bankrupt. The power purchase agreement'll be worthless then.

That is, it is specifically the transmission and distribution network that is driving costs increases. Per the crappy AI answer "Electricity distribution costs now often exceed the cost of electricity generation for U.S. utilities, with transmission and distribution (T&D) costs potentially comprising over half of a customer's energy bill, up from about one-third previously."

I should say, I have no problem thinking data centers may need to pay more. If only because they are probably able to. My assertion is just that it is misleading to pin them as THE reason costs have gone up. It is far more complicated than that.

Generally (but there are exceptions) in the US they have not gotten better. It's just that datacenter demand has eclipsed the effect of that.

> My assertion is just that it is misleading to pin them as THE reason costs have gone up. It is far more complicated than that.

It's not so much that they are the sole cause, but that their effects (especially on local scales) are 1-2 orders of magnitude larger than all other causes, so people focus on this matter.

Not nothing. And if we can do things to reduce this, I'm game to do that. But I can't get behind the rhetoric that they are eclipsing other cost drivers.

We (Well, the article does it for us as well) can identify that this market jump is driven primarily by increased demand rather than lower capacity, as the amount of capacity sold has increased. (Covering ~50% of the new demand)

These prices do not immediately translate into residential fees, there's a lot of financial engineering in between the auction and customer contracts (F in chat for the counterparty of the hedge), but at the end of the day you can't sell $500 of power for $5 so the increased cost will worm their way through to residential consumers eventually. One particularly annoying thing is that this isn't a consistent amount of time by region; Some people are seeing 3x electricity bills already, for others their power company may have more strongly hedged against price increases.

Is your contention that we a) not believe this will only have an "at most 5% increase" or b) predict that it will be more dramatic in the future?

I'm also curious where you are getting the 3x electric bills claim. The largest bill jumps I'm aware of were in CA and were largely related to fires. That and general grid upgrades.

One of the other replies alludes to it, but I want to say it explicitly:

The key difference is that you can generally drill down to assembly, there is infinitely precise control to be had.

It'd be a giant pain in the ass, and not particularly fast, but if you want to invoke some assembly code in your Java, you can just do that. You want to see the JIT compiler's assembly? You can just do that. JIT Compiler acting up? Disable it entirely if you wish for more predictable & understandable execution of the code.

And while people used to higher level languages don't know the finer details of assembly or even C's memory management, they can incrementally learn. Assembly programming is hard, but it is still programming and the foundations you learn from other programming do help you there.

Yet AI is corrosive to those foundations.

It's way easier to drill down in this way than the bytecode/assembly vs. high-level language divide.

You can. You can also read the code a compiler produces perfectly well. In fact https://godbolt.org/ is a web site dedicated to programmers do just that. But ... how many programmers do you know who look at the assembler their compiler produces? In fact how many programmers do you know who understand the assembler?

Now lets extrapolate a bit. I've seen people say they've vibe coded a some program, yet they can't program. Did they read the code the LLM produced? Of course not. Did it matter? Apparently not for the program they produced.

Does the fact that they can vide program but not read code alter the types of programs they can produce? Of course it does. There limited to the sort of programs an LLM has seen before. Does that matter? Possibly not if the only programs they write are minor variations of what has been posted onto the internet already.

Now take two people, one who can only vide code, and another who knows how to program and understands computers at a very deep level. Ask yourself, who is going to be paid more? Is it the one who can only write programs that have been seen many times before by an LLM, or is it the one who can produce something truly new and novel?

A big problem with the "Just read the code" approach is that reading the code at the level deep enough to truly understand it is at minimum equally time-consuming than writing the code in the first place. (And in practice tends to be significantly worse) Anyone who claims they're reading the LLM's code output properly is on some level lying to them.

Human brains are simply bad at consistently monitoring output like that, especially if the output is consistently "good", especially especially when the errors appear to be "good" output on the surface level. This is universal across all fields and tools.

Some prompts / AI agents will write all the validations and security concerns when prompted to write an API endpoint (or whatever). Others may not, because you didn't specify it.

But if someone who doesn't actually know about security just trusts that the AI will just do it for you - like how a developer using framework might - you'll run into issues fast.

Transformer models making screen readers better is cool. Companies deciding to fire their human voice actors and replacing all audiobooks with slop is decidedly not cool.

You can really see this happening in translation right now. Companies left and right are firing human translators and replacing their work with slop, and it's a huge step down in quality because AI simply cannot do the previous level of quality. (Mr Chad Gippity isn't going to maintain puns or add notes for references that the new audience won't catch.)

And that's in a market where there is commercial pressure to have quality work. Sloppy AI translations are already hurting sales.

In accessibility, it's a legal checkbox. Companies broadly do not care. It's already nearly impossible to get people to do things like use proper aria metadata. "We're a startup, we gotta go fast, ain't got no time for that".

AI is already being used to provide a legally-sufficient but practically garbage level of accessibility. This is bad.

But the coverage of audiobooks is… also not great? Of the books I've purchased recently, maybe 30% or less have audiobooks? What if I want to listen to an obscure book? Should I be paying a human narrator to narrate my personal library?

The copyright holders are incentivized to make money. It does not make financial sense to pay humans to narrate their entire catalog. As long as they're the only ones allowed to distribute derivative works, we're kind of in a pickle.

You weren't doing that before AI either, were you?

The practical answer has already been "you pipe an ebook through a narrator/speech synthesizer program".

> The copyright holders are incentivized to make money.

Regulations exist. It'd be rather trivial to pass a law mandating every ebook sold to be useable with screen readers. There's already laws for websites, albeit a bit poorly enforced.

That said, I use it with pretty direct prompting, and I strongly prefer the "AI Partners with a Human" model.

But for what it concerns my previous comment: It doesn't really matter what the "state of the art" AI is because companies simply do not use that. They just pipe it through the easiest & cheapest models, human review (that does not actually get the time to do meaningful review) optional.

We have them on the record in multiple lawsuits stating that they did exactly this.

One imagines Leadership won't be so pleased after the inevitably price hike (which, given the margins software uses, is going to be in the 1-3 thousands a day) and the hype wears off enough for them to realize they're spending a full salary automating a partial FTE.