Unlocking the Future: AI, Investment and Job Creation – Shimmy Says EP1

Hey everyone, it's Alan Shimmel, CEO founder at Techstrong, and welcome to my first adventure on LinkedIn Live here. We're starting a new show and we call it Shimmy Says, because it's me saying whatever I want talk about, but it's not just what I want to talk about. I want to hear what you guys have to say as well.

Um, look, we're gonna aim for 10, 15, 17 minutes here, so it's not gonna be too long. But if you've got something you wanna ask me or a topic you want me to, you know, comment on, I'm happy to do it. If you're not familiar with what we do here at Techstrong, you know, we cover DevOps and cyber and cloud Native ai, ITSM and everything else.

So that being said, I really wanted to talk today though about what, what things to be capturing a lot of new cycles. And that's this Project Stargate that was announced yesterday by the Trump administration, along with in-person, uh, appearances by Sam Altman of open API of, uh, excuse me, Chad, GPT Open ai, uh, Larry Ellison of Oracle, and Maan of SoftBank. Now, there's a lot of people out here saying, holy mekel, $500 billion.

That's a lot of money. What a great thing. There's a lot of other people saying $500 billion.

Who are they getting all those companies together? Don't have $500 billion to invest in this. And even if they did, would they when they would, would they?

When will they, what will come of it? How are they, are they all gonna play nice? Because it's not just those three companies.

There's Microsoft involved, and you could beg Google and Amazon and the usual cast of Tech High, uh, hyperscalers will be involved. There's another group of people. And, and quite frankly, this was my initial reaction too, is no, that $500 billion isn't coming from commercial private investment.

That's money that the Trump administration's gonna take out of the federal funds. And it's kind of the payback to the tech bros who've invested all the money, all the money they have in the Trump campaign, and, you know, making gifts to the inaugural fund and so forth. So, you know, what, where does the truth lie here?

So, first of all, let me say I'm a big fan of investing as much as we can into AI infrastructure. I do think that AI is going to change the very fabric of civilization, much the way the internet has. As a matter of fact, I think AI is the biggest thing since the internet.

So let, let's see what that has to, to stay on it. Um, I do think that we are in a race for technology, much like the space race of the sixties, except this time it's China or not the Soviet Union. And we want to take as much, take down as much as we can, uh, here in the US to con continue our dominance and lead in technology and specifically in this AI field.

But it's not just the us. I think this is a game of the entire Western liberal, you know, modern liberal western world trying to do this. And I don't know how much they're gonna be willing to just abdicate it over to the US And this is a global game.

Make, make no doubt about it, right? You're gonna have investments from Japan, from friendly countries and people in the Middle East as well as Europe. I read an interesting point of view on it in Forbes today, which is really what they're looking to do is soak up as much of the venture capital that's being, you know, set aside for AI as possible before it makes its way to China.

And you know, again, I, I took the different view of that 'cause how much VC actually makes its way to China. I think VCs have been burned. Western VCs, western sources of funding have been burned investing in China because China follows a predictable path.

They take your money, they make goods until they don't wanna make your your goods, or they don't want to let you make your goods. They'll make your goods themselves. You see it with cars, you've seen it with planes, you've seen it with toys and clothing in factories.

This is what China does. They take the money, they offer you promise to their, you know, huge market. And then they, they don't exactly open the kimono, so to speak to their market, and they wind up keeping it for themselves.

So I don't know if western dollars are gonna be flowing to China for AI investment. However, there are, there will be competitors for AI investment beyond the us. There'll be Canada, there'll be Western Europe, there'll be Israel, there'll be Eastern Europe as well.

Um, it's a global market that we live in. And even with that though, $500 billion, I don't see how, if that's a real number that we're gonna spend in four years, that's $125 billion a year. I just don't see us spending anywhere near that kind of money.

'cause we just, the, the capacity to do so is, is not there. Um, how much of it will be government? Is it for every, you know, 1 billion in private, you're gonna have 10 billion in government money set aside to this?

I don't know. And, and let me say, I'm not against the government putting money into this, right? If you look at every million dollars that the US government spent at NASA during the space race, it probably returned 10 x in in private accomplishments.

Either in new, new technologies, new products, new processes that really helped the American economy boom, from the sixties into the seventies. So this is, this is an amazing kind of thing. Um, I, so I'm, I'm not against the federal government paying into this and, and making it happen.

I would like to make sure that it doesn't just end up in the hands of a few oligarchs, right? I think this is, it will create a lot of jobs. It will be a defining moment for the rest of this century if American can really get behind this.

But it has to be done right? It can't, it can't wind up being like a, a Vladimir Putin and his and his, you know, oligarch friends, divvying up this big pie that we all put into. I see we've got a question.

It's from our friend Paul, and he wants to know, what do you think about the plan $500 billion investment? Well, I think I just told you my, my 2 cents on it, but I, I'd be interested to hear what you guys think. A lot of people, or not a lot, but some people say that, Hey, AI is relatively unproven.

Frankly, we haven't seen the results in terms of business that we thought we would see up to this point. Well, it's still early in the game. What is that $500 billion gonna go into?

Well, they're talking primarily about data centers, but in order to have the data center, you have to have energy that feeds that data center. So whether we're talking, I, you know, I'm not going out and saying let's go frack drill, baby drill. But we need energy, whether it's compact, nuclear, hydroelectric, solar, wind, natural gas, some sort of clean, I would hope renewable sources as well.

We need to figure out the energy formula. Secondly, the, the, just the cooling and so forth for these chips. We need better technology, not just at the chip level.

'cause we need to make these chips. Right now, these chips are basically all made in, in Taiwan. Daniel Newman, over at the Futurum group of which we're part of.

Put out a nice LinkedIn post today with a chart. You know, the fact of the matter is when you look at foundry, uh, Taiwan semiconductor still has, I think 62% of the foundry market. We need to change that equation and have those foundries here in the US as well.

I think. Um, so you've got chips, you've got energy and cooling you need, you're gonna need more networking, right? There was a time I thought we had overbuilt.

I think we all thought we had overbuilt fiber and so forth. But whether it's 5G or other resources, we're going to need more of that. Jody has a question.

Will it create as many jobs as it potentially eliminates? There's not a doubt in my mind that AI will create more jobs than it eliminates. And the jobs that it creates are gonna be higher paying jobs than the jobs it eliminates.

'cause I think at the first thing it, AI takes out lower paying, lower hanging fruit jobs that is sort of remedial and the jobs that will create will be higher paying. I think the bigger question for this operation Stargate is will it create net net new jobs? So it's not just replace one for everyone you lost.

Does it create whole new classes of jobs? And not just the AI jobs you're thinking about? Someone's gotta build these data centers that's construction jobs and all that goes into constructions, architects, electricians, and plumbers.

And people are gonna have, you know, these data centers will be staffed by people. So you need facilities for those. You're going to need screens, you're going to need alarm systems.

You need, you know, everything that goes along with a modern data data center. So I think it create then you have the fact that the e economics of the data center, the people who work there need to eat lunch every day. They need a health club to go to a gym.

They need doctors, they need schools for their children around these data centers. This kind of, and this is why I'm, I'm all for the government getting involved in it. This kind of investment is like planting a seed of which a whole town or a whole ecosystem grows up around it.

There are plenty of studies that show for every dollar you invest in infrastructure, it throws off three to $10 in, in other kinds of economic investments supporting that infrastructure. And I think the same is true here. Again, the, the same way, we don't want to concentrate this though into just, but a handful of oligarchs getting this money.

We need to make sure that these data centers are geographically dispersed, right? Maybe we don't put them in hub zones, as we used to call it when I was selling to the federal government, economically disadvantaged areas. I don't know if we need to do that.

I, I know for instance, there's a huge data center going up in Abilene, Texas where my son Bradley works and happy to I, having been to Abilene, I can only imagine what a huge data center will would do for that economy. Um, but we need to spread 'em around. It shouldn't be just Texas.

It shouldn't be just red states or blue states. It shouldn't be just disadvantaged areas. That $500 billion has to find its way throughout the US if it's gonna be there.

I mentioned earlier, Canada, Mexico, Western Europe, I don't, you know, they're not gonna sit on their hands, nor should they sit on their hands and let all this money flow into the us. I think corresponding dollars will probably flow into locations where it makes sense there, right? I, I think capital goes like fluid to the lowest level where it makes the most sense.

So I'm hoping we, we'll, we'll see, you know, the, the, the repercussions and the, and the fallout from this will make its way even beyond the board is of the us. Um, but make no mistake. We, in the US look, we, we invented the internet.

We've been, you know, technology has, has been the linchpin of our economy now since the nineties as we move to a service economy, I think if we wanted to continue. So we need to be the kings of AI technology and we can't, uh, sit idly by and watch other countries out, maneuver us out, out, fundraise us out, technology us out, innovate us. So I'm, I'm, you know, when you add it all up, the pros and the cons, I'm a huge fan of Project Stargate.

I, I think if it's done right and it doesn't become some big fat pork barrel for a couple of tech pros who supported the current administration, this could be a fantastic thing for America, for the West and, and for, and for the tech market, right? We've had a tough year in the tech market. Last year was a tough year.

I had a lot of friends looking for jobs. This really could ignite things. And you know, I'm just really bullish on it.

Another thing I wanted to mention is, because of all that, we're liable to see real innovation in techno, in AI capabilities, which can disrupt so many different fields and bring so many more jobs and opportunities to us. So I'm bullish on ai, I'm bullish on Project Stargate. I'm bullish on investing.

To me, this is sort of an infrastructure investment, which is something even, I mean the Biden administration was in on with the Chips Act and everything else. I was bullish on that. I'm bullish on this.

That's it for Shimmy. Says this week we're gonna be back next Thursday, 2:30 PM Eastern time, and I'll talk about whatever, whatever is happening next week. But until then, hey everyone, have a great day.

Check us out on Textron Gang every day, or any of our Textron properties is Alan Hummel. We're out.