Introduction and Acknowledgments:

Dr. Eric Schmidt, chair of the National Security Commission on Artificial Intelligence, begins his talk by thanking the National Defense Industrial Association (NDIA) and General Carlisle for supporting the event and their efforts. NDIA is cited as a natural sponsor for promoting the ideas he will discuss.

Key Discussion Points:

Schmidt outlines that his talk will focus on three major areas: the future of Artificial Intelligence (AI), the competition with China in emerging technologies, and crucial technology platforms vital for the U.S.’s prosperity and national security over the next decade.

AI at the Center of U.S.-China Competition:

Schmidt emphasizes that the United States is in a technology competition with China, with AI being a focal point of this contest. He strongly believes that AI is crucial for maintaining national competitiveness.

Interdisciplinary Collaboration:

Schmidt calls for urgent and collaborative efforts across government, industry, and academia to lead in these technologies. He stresses that everyone, including the audience, has a role to play in this national effort.

Importance of Recommendations:

He mentions that their commission’s report is filled with recommendations, arrived at through extensive work with the federal government. Schmidt strongly urges the audience to review these recommendations, emphasizing their importance for the nation’s future.

Definition and Importance of AI:

Dr. Eric Schmidt defines Artificial Intelligence (AI) as the capability for machines to perform human-like tasks. He states that AI has increasingly become integrated into daily life and various industries, offering novel insights and innovations that have eluded human expertise.

AI as a Catalyst for Accelerated Progress:

Schmidt discusses AI’s revolutionary impact on human activities. He insists that we are in the nascent stages of an AI revolution which will accelerate scientific and technological advancements. He suggests that breakthroughs that would typically take decades could occur in just months due to AI’s potential.

AI in Scientific Discovery:

One compelling example Schmidt shares involves a team at MIT using machine learning to screen chemical compounds for potential antibiotics. They successfully discovered a new antibiotic called halosine using an algorithm that learned to predict molecular functions without any human-imposed assumptions or labels.

AI in Language Translation:

Schmidt admits that he initially doubted AI’s ability to translate languages, but developments have proven him wrong. Current AI translation systems, although not perfect, are nearly as proficient as bilingual speakers. He suggests that universal translation will promote better communication globally, but also warns of challenges such as misinformation and hate speech.

Ethical and Value-Based Considerations:

Schmidt emphasizes that AI systems should reflect societal values, cautioning that if not programmed to do so, they could propagate hate speech and misinformation. Ethical considerations are an area that is actively being explored.

AI in Automation and Transportation:

He states that while AI is commonplace in software automation, like Siri or Alexa, the application in physical robotics lags. However, he predicts that AI will soon automate activity in various vehicles and tools under human direction, giving examples like AI in air combat simulation projects by DARPA.

Readiness of AI Tools:

Schmidt asserts that the software and techniques required to build sophisticated AI systems are readily available and no longer “rocket science.” The technology is at a stage where its expansive applications can be realized.

Focus on Tech Platforms:

Dr. Eric Schmidt emphasizes the importance of focusing on tech platforms. He believes these platforms will shape various facets of national power, such as healthcare, food production, and environmental sustainability.

AI’s Transformative Role:

Schmidt states that the adoption of Artificial Intelligence (AI) will significantly influence economies and societal structures. These platforms have evolved rapidly; many did not even exist a decade ago. The lack of existing intellectual concepts and regulations for their development and use is highlighted as a concern.

Global AI Landscape:

While many countries have developed national AI strategies, Schmidt notes that most of the progress is concentrated in the United States and China. These two nations possess the resources, talent, and innovation ecosystems to lead the world in AI technology.

US-China Tech Rivalry:

Schmidt warns that China is quickly becoming a peer in AI technology and has set the goal of surpassing the United States. He considers China’s potential leadership in key technology areas as a national crisis for the United States.

Strategic Importance for the US:

For Schmidt, maintaining technological leadership is not only crucial for economic prosperity but also for national security. He argues that this leadership will offer the US government and military access to the most advanced technologies and put the United States in the best position to secure them.

China’s Ambitious Plans:

Schmidt indicates that China is aggressively pursuing technological leadership through initiatives like “Made in China 2025.” Apart from AI, China aims to lead in quantum computing, 5G networks, and synthetic biotechnology.

Strategic Competition and Risks:

Schmidt ends by reinforcing that the United States is in a long-term strategic competition with China. Should China gain a first-mover advantage in new technologies, it will become challenging for the United States to catch up, especially in sectors with strong network effects.

Overall, Schmidt’s talk underscores the urgency for the United States to act swiftly in developing and regulating advanced technologies, especially AI, as they will be central to global power dynamics in the coming years.

Network Effects and Market Share:

Dr. Eric Schmidt discusses how platforms often secure 80-90% market share due to network effects. This highlights the importance of being a first mover in technology.

Unified Strategy for Competitiveness:

Schmidt emphasizes the need for the United States to develop a unified strategy that focuses on advancing technologies crucial for national competitiveness in the 21st century. He mentions that such strategy must strike a balance between competition and cooperation, particularly with countries like China.

White House-Led Approach:

Schmidt strongly supports the establishment of a Technology Competitiveness Council led by the White House. This council, chaired by the vice president, would be responsible for developing and funding a comprehensive national technology strategy, setting priorities and reconciling budget trade-offs.

Collective Power vs Disorganization:

Schmidt states that working collectively makes the country incredibly powerful, whereas disorganization leads to missed opportunities and loss of time.

Focus Areas for National Strategy:

Schmidt lists AI, 5G, microelectronics, biotechnology, and quantum computing as priority areas that should be included in the national strategy. He also emphasizes the significance of advanced production sectors like manufacturing, agriculture, and assembly.

Resilience and Infrastructure:

Schmidt argues that modernized infrastructure augmented by machine intelligence is essential for handling supply chain shocks, natural disasters, and epidemics. He advocates for domestic production of high-tech goods as a matter of both national security and economic resilience.

Infrastructure for Emergencies and Environmental Impact:

Citing examples like the Texas gas supply freeze and California wildfires, Schmidt underscores the need for an infrastructure capable of handling emergencies. He also speaks to the environmental benefits of a well-connected infrastructure.

Connectivity as a Priority:

Schmidt laments that no U.S. cities are in the top 10 for smart city connectedness and stresses the importance of a robust computing and connected infrastructure in today’s digital economy.

Assertive Government Role:

Schmidt concludes by advocating for a more assertive role by the government in implementing these strategic objectives, emphasizing that failure to do so will leave the U.S. behind in global competitiveness.

Schmidt’s speech elucidates the urgency for the United States to have a coordinated, forward-looking strategy in technology and infrastructure to maintain competitiveness and ensure national security.

U.S. vs China Innovation Models:

Dr. Eric Schmidt emphasizes the differences between U.S. and Chinese approaches to innovation. The U.S. relies on an open exchange of ideas, free markets, and limited government involvement. Tech companies in the U.S. focus on market share and aren’t considered state instruments. However, Schmidt warns that maintaining the status quo won’t suffice in the competition with China.

Need for Hybrid Approach:

Schmidt suggests that U.S. tech companies alone cannot compete with the resources of a nation-state like China. He argues for a “hybrid approach” that more closely aligns the government and private sector. He notes the government’s responsibility to create a resilient research and development ecosystem and to protect intellectual property.

Funding and Policy Choices:

Government needs to focus on expanding talent pipelines and improving educational systems, which includes revising immigration and visa policies. Schmidt also talks about the necessity for tailored government funding and regulatory changes to promote innovation and protect technological advantages.

Technology Sectors:

Schmidt mentions several key areas where the U.S. needs to focus: Artificial Intelligence (AI), 5G, microelectronics, quantum computing, and biotechnology. For example, he notes that China is ahead in 5G and suggests reinvesting spectrum auction proceeds into network infrastructure. He also advocates for tax credits and grants to encourage domestic production of microelectronics.

Quantum and Biotechnology:

Schmidt warns that the U.S. is at risk of losing its lead in quantum computing and biotechnology. He suggests doubling down on investment in these areas. He emphasizes the importance of domestic manufacturing and the creation of a world-class biobank for research.

In summary, Schmidt calls for a strategic realignment involving greater government participation to maintain the U.S.’s competitive edge in technological innovation.

Cloud-Based Biofabrication:

Dr. Eric Schmidt highlights the need for advanced biofabrication tools in manufacturing to be made more widely accessible. Such tools could be shared via a cloud-based resource, accelerating innovation in biology-related technologies.

Trillion-Dollar Companies:

The speaker believes that this sector holds the potential for creating trillion-dollar companies, emphasizing its importance not just for innovation but also for national security.

National Defense Implications:

He states that the commercial and military sectors will work together to push these technologies further. He argues that in the realm of national security, AI-enabled capabilities will become the primary tools, replacing traditional methods.

AI as a Double-Edged Sword:

AI will also be used by adversaries to exploit the U.S.’ digital openness. Such technologies can amplify existing cyber threats, affecting both individual citizens and national infrastructure.

Military Preparedness:

Schmidt stresses the need for the U.S. military to embrace AI to remain competitive. He warns that without the integration of AI, defending against future threats would be virtually impossible. He is concerned about the Department of Defense’s current pace of technological integration.

Reforming the DoD:

Schmidt calls for a revision in how the Department of Defense builds technology, advocating for more iterative, agile approaches like those found in Silicon Valley. He emphasizes that current procurement processes are hindering rapid innovation.

Global Competition:

The U.S. is facing stiff competition, particularly from China, in the technology sector. Schmidt suggests that to maintain leadership, the U.S. needs a focused, bipartisan effort to extend its technological edge.

More than Technology:

Schmidt concludes by stating that the stakes go beyond just technology or military might; they also encompass values like individual liberty and the principles of free societies.

The overarching message is one of urgency; Dr. Schmidt calls for immediate action to sustain and extend American technological leadership for the sake of national security and prosperity.

Venture Capital’s Role in Innovation:

Dr. Eric Schmidt points out that venture capital predominantly funds innovation that fits its model. While he appreciates the U.S. system of venture-funded innovation, he acknowledges that it can’t cover all areas, particularly those with infrastructure barriers.

China’s Approach:

In contrast to the U.S., China has a state-led approach to innovation. The Chinese government selects a winner in a highly competitive domestic market and massively funds it. Dr. Schmidt notes that this approach is working well for China but is culturally unsuitable for the U.S.

Government Strategy:

Schmidt argues that the U.S. could compete effectively using its existing venture model if there is government intervention to remove certain barriers. Examples include the spectrum issue in 5G and immigration, which are beyond the reach of the private sector to resolve. He advocates for a holistic government strategy to align everyone in the same direction, without resorting to top-down management.

Technology Priorities:

The speaker identifies a list of technology areas that should be prioritized, including AI, 5G, robotics, synthetic biology, energy, and transportation. He notes that there is widespread agreement among experts on this list of priorities.

Contractor’s Role:

In response to a question, Dr. Schmidt suggests that contractors, whether large defense firms or smaller commercial ones, can align with the national strategy for technological innovation by contributing to these priority areas. Specifically, the semiconductor field is noted as a particularly challenging and crucial area.

Role of Contractors in Government AI Initiatives:

Dr. Eric Schmidt suggests that government contractors should actively develop powerful AI research groups to demonstrate their capabilities. He believes that rather than the government specifying AI projects, contractors could lead by showcasing their research. This could result in more effective partnerships and optimized solutions for governmental needs.

Importance of International Collaboration:

Schmidt emphasizes the need for alignment with democratic allies on technology strategies. He mentions existing coalitions like the Quad (Japan, Australia, India) and proposals for other groups that include key European and Asian partners. Coordination among these nations could accelerate AI research and capability development, particularly in the face of great power competition.

National Strategies for Technical Fields:

Schmidt advocates for clear, understandable national strategies around areas like microelectronics and quantum computing. These strategies would outline objectives and identify leverage points without dictating the specific products to be developed.

Human Capital in Technical Governance:

The talk identifies a skills gap in the government, particularly when it comes to understanding complex technologies like AI. Schmidt proposes two main solutions: a specialized four-year civilian college requiring subsequent government service and a reserve program for skilled professionals to assist the government on a part-time basis.

Funding Innovations:

When asked about venture capital’s role, Schmidt highlights that the government should support but not crowd out private investment. He advocates for promoting research and infrastructure that benefits everyone, keeping risk and incentives aligned.

Slow Adoption of AI in Government:

The root cause for the slow adoption of AI in government, according to Schmidt, is not a lack of interest or understanding but structural and organizational constraints. He mentions that agencies often lack coherent direction, making it difficult to prioritize AI.

Overall, Schmidt’s insights touch on the symbiotic relationship between government and the private sector in advancing AI technology, the importance of international partnerships, and the need for focused talent acquisition strategies.

Government Hiring Practices:

Dr. Eric Schmidt suggests changing government hiring processes to include people with more technical familiarity. He clarifies that he’s not advocating for hiring programmers per se, but people who have a more technical approach, possibly in engineering or data science.

Importance of STEM:

Schmidt emphasizes that national priorities should focus on STEM (Science, Technology, Engineering, and Mathematics) fields. He argues that many of the pressing issues facing society are STEM-related and that people capable of excelling in these subjects should be encouraged to do so.

AI Accessibility:

He expresses optimism about the future impact of AI, stating that these systems are not exclusive to elite professionals but can benefit everyone. Schmidt foresees a future where AI systems make people “smarter” and help them navigate daily tasks, potentially leading to higher wages.

Current Limitations of AI:

In response to a question about the limitations of machine learning, Schmidt points out that existing models are not perfect and often can’t explain their decision-making processes. However, he considers them useful for advisory roles in various settings, such as healthcare and transportation.

Future of AI:

Schmidt mentions that there is a divide in opinions about how far AI will advance. Some “true believers” think that AI will develop human-like reasoning and creativity within the next decade, while skeptics argue that the computational requirements are too great. Regardless, he believes that AI will continue to transform every industry, acting as a smart advisor in multiple sectors from agriculture to defense.

AI’s Role as Advisor:

Schmidt concludes by emphasizing that, at the moment, the best way to think of AI is as a “really smart advisor” useful in various applications. It can help in military operations like identifying tanks in satellite images, assist in consumer choices like buying flowers, and aid farmers in crop planning.

China’s 5G Dominance:

Dr. Eric Schmidt points out the stark gap in 5G infrastructure between China and the United States. China has approximately 720,000 5G towers, planning to add 600,000 more, while the U.S. has only about 50,000. This creates a gap of at least an order of magnitude, making China’s 5G network 4.7 times faster than the U.S. network.

5G as a National Priority:

Schmidt argues that having a robust 5G network is essential for the United States. He recommends the appointment of a dedicated group or “5G czar” to solve the 5G infrastructure gap. Funds from expensive telecom auctions should be reinvested into the 5G infrastructure to accelerate development.

Importance of 5G beyond Mobile Phones:

5G isn’t just about faster phone service. Schmidt highlights that 5G’s rapid communication capabilities, known as isochrony, are critical for autonomy, which is in turn crucial for national defense. He also mentions that 5G will enable the development of powerful new apps, and if the U.S. doesn’t catch up, these apps will likely be developed in China under their values and governance.

Breaking Down DoD Silos:

In response to a question about the Department of Defense’s (DoD) siloed approach, especially in AI applications, Schmidt suggests that both commercial and military systems need to be less compartmentalized. He hints at an enterprise-wide project within the DoD aimed at extracting data from these isolated systems into a central data platform.

Diversity in AI Community:

Addressing the lack of diversity in the AI field, Schmidt identifies the need for more inclusive efforts. He emphasizes that empowering a diverse set of people in technical fields is not just good for society but also crucial for national security.

Closing Remarks by Kevin McGinnis:

The conversation ends with a summary by Kevin McGinnis, Director for Research and Analysis on the National Security Commission on AI, who recaps the conference’s broad participation and urges the audience to implement the Commission’s recommendations and consider creating a comprehensive source for AI case studies.

The conversation touches upon several critical issues, highlighting the urgent need for the United States to invest and catch up in crucial technology areas like 5G and AI for the sake of national security, economic competitiveness, and social inclusiveness.