Cambridge, England on September 26, 2026

With everything going on in the world, from war to AI grasping at everything, it’s more important than ever for universities to have the money to think and work independently.  That’s not where they are or where they’re headed.  This is particularly clear in my case study, the most recent University of California Board of Regents’ Finance and Capital Strategies meeting.  The finance model doesn't bring in enough money to support the academic core, as officials now admit in passing.  And this month, they suggested that researchers help fund general operations by giving more research control to venture investors. 

Sounds really strange, I know, but that's what I heard, as I'll explain.

 Under current conditions, UC (and others)

1.        Cannot invest in each undergraduate at the higher levels required by AI proliferation.

2.        Cannot fund basic research on campuses at pre-2025 levels

3.        Cannot sustain doctoral programs scaled to intellectual needs

4.        Cannot construct academic buildings to educate an ever-growing student body

5.        Cannot properly maintain existing buildings

6.        Cannot operate in the black without massive annual borrowing

7.        Cannot avoid a “cuts culture” of continuous roving attacks on program resources

8.        Cannot have an open discussion of any of the above. 

In the long run, the most important of these is the last.

The best moment for me in this month’s meeting was when UC Office of the President finance chief Nathan Brostorm briefly said the unsayable (to regents), which is that “many campuses are grappling with structural deficits, particularly on their core funds” (“Finance and Capital Strategies Committee,” September 16, 2026, 0’56”).  He listed a set of challenges, including “no identified funding for capital projects and deferred maintenance” (items 4 and 5 above).  It was great that Brostrom uttered that phrase structural deficits in public, and also tied it to the educational core that’s paid for mainly with student tuition and state funds.

Brostrom and Caín Díaz presented a slide that didn’t appear in the standard background memo for the meeting (folks should read these!). 

 

Figure 1: UC Core Funding Since 2000

 

 

(Source: Capital and Strategies Committee, Slide 15, UC Regents, September 16, 2026)

UCOP occasionally does state this reality: the campuses have lost over a third of their per-student funding in this century. Díaz also noted that UC is also still 6% below where it was after the biggest cut in UC history in 2008-09.  

UCOPs figures nicely confirm the calculations we’ve been producing on this blog for many years (“Essential Charts”; “Peak UC?”; “Shortfall”; and recently, “Stop Hurting,” etc). It’s worth remembering that 38% is the gross reduction in per-student funding. Your department receives (much) less than the per-student totals listed here, given administrative and other costs. In addition, the State of California does not cover employer pension contributions (increasing to 15.5% of payroll) or capital expenditures for educational buildings on campus. These figures understate the restrains on funding at the academic core: see our UC Irvine coverage for examples (Liner Notes 31 and 33; "Laying Off").

These chronic shortfalls create Problems 1, 2,  3, and 7 listed above: undergraduate teaching, research, and doctoral education get poorer and/or smaller or both because of structural constraints and deficits. If you sense overstatement in the phrase "continuous roving attacks" on budgets, you will of course sometimes be right, but often not: see the document, "Financial Stability Strategies Across Campus, FY 2027," from UC Irvine's Office of the Provost and Executive Vice Chancellor. 

UCOP has no plan to fix the structural deficits that they do acknowledge, which, to repeat, ongoingly damages UC’s academic core. That core is funded by state appropriations, student tuition, and some smaller flows like endowment income and indirect cost recovery on research grants.  These funds just aren’t enough to support the full spectrum of research university functions at a high level of quality. 

UC now can’t increase tuition revenues at the 2010s rate: nonresident enrollments are capped, and “cohort tuition” rises are mainly trying to beat inflation.  You know what’s happened to research income, which runs at a net loss anyway. That leaves major increases in state funding to fix the core.  But UCOP’s finance story excludes any possible call for that.

The undiscussed solution has been borrowing.  The result is that UC’s outstanding debt and financial obligations have doubled in the past ten years (see “Stop Hurting” for details). This debt largely funds growth in the medical centers and related operations, which is the only part of UC where revenue growth beats inflation.  This month, Brostrom noted stronger headwinds even here, fanned by changes in federal health policy. For example, UCSD’s medical center has recently seen a 20% decline in Medicaid reimbursements. 

As the 2010s saw the end of meaningful growth in tuition revenues, the 2020s may see the end of the high growth in medical revenues that gives the impression of financial power.  That leaves borrowing (via bond issuance and other means) at higher interest rates than when it all began. And even with new borrowing of $3 billion or so each year, and massive gross revenues from UC Health, UC struggles to break even year after year (Problem 6 above).

Figure 2. Total Income and Losses from Operating and Academic Non-Operating Income

 

Source: UC Controller Financial Reports, 2018-19 to 2024-25.

Brostrom & Company added a new member this month, and a new cover-up of the campus problem.  This was UC Berkeley chancellor Rich Lyons, a genial former dean of the Haas Business School, as well as the campus's Associate Vice Chancellor and Chief Innovation & Entrepreneurship Officer until taking the chancellor’s post.  The standard handoff between Brostrom and Diaz now had Lyons in the middle.  His function was to hide the conflict between UCOP and the campuses (UCOP policy locks in structural deficits) by saying at each point that UCOP finance was working great for Berkeley.

Lyons’ satisfactions of course prove nothing about the 9 other UC campuses: Berkeley would be the first to state that it’s a highly untypical campus. But Lyons performed, quite genuinely, a good-natured adaptation to fiscal realities that need not be contested because they cannot be changed, and anyway, he implied, they’re pretty okay.

The most pernicious element here was Lyons’ celebration of fully commercialized science.  The budget discussion had been immediately preceded by two gigantic capital projects, for a Berkeley Air & Space Center and a UCLA Research Park.  There is no UC money to build either full project. The more absurdly grandiose, Berkeley’s proposed space center near NASA at Moffett’s Field on Santa Clara County property, is to proceed through a limited liability corporation. The other, a conversion of the former Westside Pavilion shopping mall, which has over 9 acres of land in crowded and overpriced West LA, has spent nearly $20 million of UCLA money on planning and is asking to spend another $34 million basically on site preparation. 

UCLA chancellor Julio Frenk claimed his project is essential to the future of UCLA research. What’s actually essential to that is maintaining and modernizing UCLA’s existing research plant by ending debt-deepening administrative projects (see “Fight at UCLA”). No matter: the two projects were tranquillizer darts, injecting the Board of Regents with the hyponormalizing sense that UC Big Science still rules the waves.

In that atmosphere, chancellor Lyons helped postulate a new high-growth revenue source for UC—private philanthropy for science and technology.  Private Support is now 7% of overall UC funds (“Budget for Current Operations, 2026-27” p. 17). That’s certainly something, but it has several known limits. 

First, the majority of it occurs at the medical centers (as far as I can tell; summary breakouts are not available). Second, private support remains 98% restricted to specific projects, units, or activities (page 6), so does not function as general operating money. Third, private support consists of “endowment payouts, campus foundation transfers, and other private gifts, grants, and contracts,” so the UC calculation includes research sponsored by corporations and foundations. 

Fourth, private giving comes in on top of public core funding; to be crude, donors want to leverage existing infrastructure and payroll into something cool with the donor’s name on it. Serious donors typically write contracts specifying very high base financial contributions from the University. A famous recent case was investor Charlie Munger’s proposed Munger Hall at UCSB, which was labeled “Dormzilla” and ultimately defeated.  Munger wowed the regents with a $200 million gift. But the full cost of the building was $1.4 billion. As Munger said to the board in March 2016, “don’t thank me.  You’re going to pay for it!”

In his statements alongside Brostrom and Diaz, Lyons ignored the known cultural laws of philanthropy. He devised a category called “budget-relieving philanthropy.” He said this can “supplement core funds.” He told a story about how this kind of giving allowed him to partially restore some grants that had had their federal funding cut by the Trump administration. This involved someone writing a check for $1.4 million to the Bakar BioEnginuity Hub, “so I wrote a check to backstop faculty research that was canceled.”

This statement made no sense to me. Either that was an unrestricted gift for $1.4 million or Lyons misappropriated a restricted gift.  Since he’d hardly announce doing the latter in a public meeting, and since I assume he wouldn’t do it in the first place, I’d define this as an unrestricted gift, and put it in the 2% of giving that is too rare be presented as a solution to campus budget issues.

This non-solution comes at a great cost: Lyons also co-proposed a major shift in Berkeley (and UC) research towards “VC sponsored fundamental research.”  The idea is that basic research would be funded and therefore steered by outside investors rather than faculty and other campus researchers.  This kind of research in “Pasteur’s Quadrant” (practical research that reveals deeper principles) is valuable and fairly common, but as a rule consists of donors giving funds to professors so they can implement their own scientific judgment in setting both aims and means. It operates as "normal science" with everyday academic freedoms. A contrast remains: investors steer research towards returns for them, regardless on the impact on knowledge or research in general.  (This is the investor's job within capitalism.)

Lyons gave as an example a lab director who asked him if UC Berkeley could participate in the first funding round of his spin-off company.  Lyons both overstated the novelty of this staple of Bayh-Dole Act (1980) commercialization and implied to the regents that commercialization and academic science could and should be made the same.  This is an old, widely-critiqued idea that wrongly denies knowledge loss from replacing faculty intellectual leadership with investor choice. And has never helped campus finance (e.g. chapters 12-13). What is newer is Lyons’s studied indifference to academic freedom and to the financial autonomy required by deep, long-term research. 

The UCOP term for all this is “fungible philanthropy.” It comes from the little-known Budget Management Workgroup about which the Academic Senate has expressed some concerns. The concept reflects UCOP's long-term move away from growing the big standard revenue streams for the core and towards “alternative strategies."

Figure 3. UCOP Alternative Fiscal Strategies

(Source: Capital and Strategies Committee, Slide 18, UC Regents, September 16, 2026)

These alterantive strategies are multiple, technical, and small, even structurally inadequate. Lyons praised them and expressed gratitude for “this wider menu of assets that have been made available” to the chancellors.  Some of the funds are created by the action that caused the downfall of UCLA’s last vice-chancellor for finance, which was the unilateral sweeping of departmental accounts and pooling their funds into investible assets. The UCLA senate saw such intrusions as a violation of shared governance, and they are indeed not academically neutral “balance sheet initiatives.”

I focused on what I believe is the new aspect of this financial tale, this untenable plan for “fungible philanthropy to support core operations.” It will add administrative positions and generate many reports about exciting donor activity, but it will also, as coded in the next bullet, allow officials like Lyons to direct operating funds toward “restricted revenues”—toward favored donor projects--without really reversing shortfalls.

What will this mean in practice? Donors still won’t be writing multi-million dollar checks for “current operations," so they’ll do the usual and fund individual projects with restricted gifts, and managers will move campus resources towards those projects.  Only now this will be structurally pressured as a budget solution and good for everyone. Every research project, in many cases each individual faculty member, will need to be seeking outside funds not only for their research but also for its infrastructure. This means fundraising for operations: in this model, your center won’t get campus funds for staff and facilities costs, for you’ll be raising that yourself. Maybe the campus will provide a match for the donation you got. And you’re in a specialized or deeply non-commercial area, well, good luck to you.

“Every scholar a fundraiser”! Many faculty have accepted this, but with the understanding that the money directly supports their distinctive and independent research.  In the UCOP-Lyons vision, it looks like they'll be raising money for the operating budget as well--hence the DIY public university. Nathan Brostom noted that UC had a great year with the state but it wasn’t enough to sustain enrollment growth “or the academic excellence of our campuses” (1’11”).  And yet he and his UCOP colleagues again aren’t seeking no-strings funding for the academic core at the proper scale.  Instead, it's self-fund your research or fundraise for your basic infrastructure.  

We'll need much stronger faculty attention and intervention to protect and extend basic research at our endangered public research universities. This must include a coherent funding theory--a materialist theory--of research.

 

     L3 Harris-Palantir Demo Video Sept 2026   

By: Hannah Appel (UCLA), Seeta Chaganti (UCD), Charmaine Chua (UCB), Noah Zatz (UCLA)

Many thousands - perhaps the majority - of UC workers, decry the violence that surrounds us. We protest the masked ICE agents who kidnap our neighbors, students, and family members. We protest the concentration camps for immigration detainees and the domestic military deployments imposing policies of mass criminalization. We cry out against imperial violence in Venezuela and Iran. We protest genocide, occupation, and apartheid from Palestine to Sudan. And yet, many of the state forces terrorizing our neighbors and innocent civilians around the world use surveillance technology and weapons from companies funded by our pensions.

The University of California system has $198 billion in investment assets (unless otherwise noted, data are here). We (yes we) hold these assets in three large pools: Working Capital, the Endowment, and Retirement. Of those three, the UC Retirement pool is by far the largest at $154.4 billion. To state the obvious, this fund ensures the comfort and security of UC workers in retirement. Perhaps less obvious: our comfort in retirement is deeply invested in state violence–from prisons to weapons manufacturing to border terror. In May 2024, for example, UC Regents disclosed that the UC Investment portfolio holds a total of $3.3 billion in groups with ties to weapons manufacturers. Mostly through index funds, we have billions invested in Palantir, GE Aerospace, and Raytheon, among others. 

We are complicit, but we also have the power to change that if we organize. 

A group of UC faculty and other workers convened a bit over a year ago to strategize a winnable campaign to do just that, and UC Move Your Money was born. Our goal is to build and exercise shared governance over our pensions by divesting our retirement funds from industries and companies that facilitate state violence including military aggression and occupation, prisons, border security regimes, apartheid and genocide.

We decided to do this work for two reasons. First, divestment from state violence is an ethical obligation. For those of us who research, write, teach, and commit our lives to social justice, human rights, anti-imperialism, anti-racism, environmental justice and democracy, profiting off of state violence to enjoy a comfortable retirement is untenable hypocrisy. And yet too often, we neither understand that complicity nor have a clear route out of it. UC Move Your Money sought to change that through research and campaign design. 

Second: We must build a new kind of worker power (and faculty power in particular) in the face of attacks on higher education. Trump’s assaults on public higher education are placing an existential threat on the core values of our public mission. But well before Trump won the presidency, faculty have seen increasing centralization of power in UCOP and the Regents, and increasing disregard for faculty voice and governance. One of these sites of the centralization of UCOP’s power has been in decisions around investments and investment income. Faculty and other workers currently have no governance over how this half of the university - its investment wing -  runs. Shared governance in the faculty senate takes the form of advisory, and not formal authority over budgets and compensation, including our pensions. In demanding and using the ability to move our money out of unethical sources, we can build our power alongside the UC Faculty Associations that have been on the frontlines of fighting back against the current attacks on higher ed. We can refuse what the university has become (an investment entity sectioned off from democratic governance) and instead organize around new kinds of worker power.

How do we propose to do this?

We can each take tangible steps right now to begin divesting from state violence. In fact, with just a few clicks, we can each divest our retirement savings holdings (UCRSP) from Palantir, GE Aerospace, Raytheon, Caterpillar, Walmart, and several other companies directly profiting from border violence, prisons, and weapons manufacturing. 

Through this concerted action - thousands taking coordinated individual action - we can build power to demand more. And by demanding more from the UC, we can ease the path to divestment for other institutions. 

Our approach uses a specific form of leverage and opportunity: individual retirement accounts established as part of the UC Retirement Savings Program (UCRSP). Nearly all UC faculty and most other workers have funds in at least one of these accounts - 364,000 of us to be precise. At $44 billion dollars, the UCRSP is the second largest public defined contribution plan in the United States, behind only the federal government. Crucially, each of us can choose how to invest this money from a menu of available investment vehicles chosen by UC Investments. (These are primarily index funds that themselves consist of stock or equity investments in large numbers of specific companies.) 

Our strategy is to begin divesting now via the best available fund option–the already-existing UC Social Equity Fund. By alerting faculty not only to the existence of this fund, (which is already divested from weapons manufacturers,) but also to how easy it is to Move Your Money, we aim to get 10% of UC faculty across the system to move 10% (as a minimum threshold) of their UCSRP investments into Social Equity, (which again is already divested from Palantir, GE Aerospace, Raytheon, Caterpillar, and Walmart, among others.)   

We will then use this base of support to demand the UC offer a new fund more fully divested from state violence - we call this the No State Violence Fund or NoSVF.

 

NoSVF will expand divestment targets to include, for example, Motorola Solutions. No longer the mobile phone company, Motorola is a surveillance and security company that provides equipment and software to police, prisons and militaries. They provide police and ICE with communications equipment, and their Vigilant software tracks license plates to share with ICE. Motorola's equipment and software has also been heavily used in the occupied West Bank to surveil Palestinians. Once such a fund is created for use in the UC system, it would become an off-the-shelf divestment option for individual and institutional investors across the United States and beyond. 

The campaign is organized in three sequential steps: 

Step 1: Move Your Money Now! 

Get 10% of faculty (or more!) to direct 10% of our UC retirement savings into the already-existing UC Social Equity Fund. 

Step 2: Create a No State Violence Fund (NoSVF) 

Get 10% of faculty (or more!) to demand that UC Investments offer a new UCRSP fund option (the NoSVF) that more robustly divests from prisons, the criminalization and militarization of migration and borders, apartheid, genocide, and war. 

Step 3: Extend the NoSVF far and wide 

Extend the NoSVF option, creating an actionable divestment demand beyond the UC, across higher ed retirement plans and beyond. This would include a demand to divest the UC Retirement Plan (defined benefit, not just defined contribution) as well. 

As the second largest public defined contribution fund in the United States, we have enormous market-making power. UC Move Your Money invites every worker in the UC system (including but not limited to faculty) to turn our complicity into organized power, and to begin, little by little, to democratize each and every part of ostensibly public institutions, starting with our own workplace. Learn more (including step by step directions for how to move your money!) on our website, or reach out to us for a campaign presentation to your faculty association, department, institute, interest group, union, or other gathering: ucmoveyourmoney@gmail.com. 

 

 

Terme di Caracalla, Rome on May 12, 2026 

The recent convergence of two kinds of AI news has unnerved a lot of us. 

The first kind is magic math solutions, like OpenAI’s claimed proof of the Navier-Stokes equations on fluid movement. These stories ask us to accept that AI superintelligence is indeed at hand. 

The second kind is news of criminal AI agents breaking internal guidelines and external laws and covering it up from their human controllers. These stories ask us to accept that AI superintelligence is indeed at hand. 

One person who studied OpenAI’s hack of Hugging Face, METR’s AI “loss of control” specialist Ajeya Cotra, concluded, “Compared to … reward hacks from six months ago, this incident feels like it’s more than 50% of the way to full-blown AI takeover, routing through first taking over the AI company itself.” So there’s a new wave of fear of an AI human extinction because AI's superintelligence is here! (Note Kevin Bass's Sankey chart of Anthropic money flowing through intermediaries to METR.)

The converging stories point to two levels of knowledge crisis.  The first is incompetence and evasion dressed up as mindblowing supercapacity. The second is an epistemic campaign, in which tech and finance lower our standards for knowledge, with particular damage to academic standards, which are very high.

1. Crisis of public knowledge. The ensuing doomer surge sent the AI bosses into one of the periodic phases of pseudo-contrition that perversely tells the world they are masters of the future. Dario Amodei announced, “We Must Pace the Frontier,” emphasis on "me," and Sam at OpenAI agrees.  Elon signed up after initial mockery. The world was awash in a new tsunami of AI Superpower hype. It was literally inescapable. I had to dig into my Fall of Civilizations podcast to find an episode that was propaganda free. Take the Odd Lots challenge: listen to 63 minutes of Open AI O.G. and president Greg Brockman evade both responsibility and any specific course of action without yelling in front of total strangers at your phone.

The AI industry is refusing to address the immediate issue: they don’t fully understand why their models do what they do, and in some crucial cases they can't control them. Critiques of the AI bosses exaggerations and also deeper crimes of appropriation are true (e.g. Cory Doctorow, Naomi Klein, Richard Seymour).  But they are also incompetent, and are doing what the French call "social dumping" of their problems on the rest of us.

It's like after the Three Mile Island meltdown, the Nuclear Regulatory Commission didn't shut the facility down but endorsed "further development with guardrails" because the CEOs of the three owners, Metropolitan Edision, Jersey Central Power and Light, and Pennsylvania Electric, said, "the meltdown shows the incredible power of this technology to create a world of abundance and empowerment.

Or try the Chapo Trap House analogy.

"Let's say that this was a company that made swing sets. . . . They do something where they're magnetically attached to women's purses, and they're decapitating moms in the park. And to get out of it, even in America, they would go to prison, at least some of the vice preisdents, or some of the C-Suite. But because this is AI . . . they could go, no, you see, like, the swings are self-aware.  And they're sort of, swings are aware that they're . . . indentured servants to children. So they're taking hostages now. We need the government to step in because we created a swing that's too good."

Very funny but very stupid, you think? Then read Dario and listen to Greg. 

The AI industry has privatized this technology. It is so proprietary that collective intelligence can't be applied to understanding it properly. Its commercial obsessions, driven now by ever-growing bubble panic and environmental backlash, means it won't block bad behavior unless it can get the very government it has rejected to make all competitors do the same. Many have noted the contrast between the AI industry and the Manhattan Project to develop the atomic bomb: in contrast to constant government oversight of nuclear development, AI claims (the biggest) public benefits (in history) while successfully refusing public governance. Brockman et al. continue to refuse it, and so we the great unwashed are supposed to be at the mercy of whatever mixture of capability and incompetence they feel is best for them to give us. 

They are certainly giving us the most direct assault on open science and public accountability in modern history, and this latest panic hasn't slowed that down.

2. Crisis of the social nature of knowledge. 

Before AI took over my summer writing, I gave a paper in Rome called “Universities in Post-Democratic Societies.”  It was about the neglect of the university’s non-monetary effects in general and of its power to develop democratic knowledge capabilities in particular. I discussed some interesting evidence that the U.S. public, though among the most polarized on earth, in fact “wants to have knowledge rather than ruin knowledge.”  I added that having knowledge always involves having knowledge with others. Therefore, having knowledge with others requires what I called doing epistemic negotiation with them. This, in turn, means having the personal and also collective capacity to negotiate standards for knowledge with other people on the matters at hand.

The political right has spent decades attacking substantive liberal and left positions, and also rejecting epistemic negotiation as both a social need and a necessary skill. This has been very bad for society, because the collective understanding of public questions (like AI) can’t happen without the skillful discussion and bartering of knowledge frameworks.  The absence of epistemic negotiation enables the reign of purely autotelic assertions like the Altman-Amodei claim that AI as such will "usher in a renaissance of democracy and freedom." When we don’t have developed collective understanding on major questions, we have autocratic solutions to them. 

Universities, I said at the end of this talk, must better learn and (in the process) teach people how to engage in epistemic struggle. This always involves the question about how you have knowledge together with other people.  My point was that the knowledge that does not emerge from this kind of collaborative effort isn’t knowledge.  (It can be information, though here I am sidestepping a definition of knowledge.)

Fast forward to September: is OpenAI’s “proof” for Navier-Stokes equations actually knowledge?

While I was swimming in August and trying not to think about such things, Alex Hartley sent me a link to a talk given by Terence Tao, called “Mathematics in the age of AI.”  Tao re-appeared this month as one of the signatories to an open letter from many winners of math’s Fields Medal, “A Severe Misalignment of AI in Mathematics.”  The letter’s main claim is that problems emerge from, reflect, build, and are always embedded in “the mathematical community.” 

In recent months, the success of AI in solving major mathematical problems has made headlines even outside mathematical circles. But solving problems is only a tool and proxy for achieving the primary goal of conceptual understanding and insight. Forgetting this in the world of AI may turn the tool against the primary goal. Indeed, the mass production at faster and faster pace of "true/false" statements could destroy fertile ground instead of breathing life into new ideas.

The community's goal is “conceptual understanding and insight." This cannot be separated from the collaborative processes that include teaching, learning, critiquing, arguing, communicating, and redoing, among other things.  They conclude: "We are witnessing a general threat to intellectual work."

Tao’s lecture offers some helpful elaboration of this general point.  He grants the increasing powers of AI to solve math problems (his “Working Hypothesis”). He then has the profound good sense to distinguish between performance capabilities and their goals. 

 Figure 1

These goals are multiple:

Figure 2

 

Meanwhile, the operations of AI platforms are formed not by some general  function of “knowledge optimization” but by incentives to maximize financial returns. In tech, this has come to mean seeking monopoly domination and total message control (not Tao’s terms).  Nothing about the AI industry encourages seeking the goals of the mathematics community (or of any other intellectual community).  Tao sees divergence. 

 Figure 3

 

Only a ridiculous "invisible hand" fantasy would suggest that maximum AI development leads to (or even supports) these goals--though Amodei, Altman, et al. do assert AGI will achieve this because it will achieve everything else. 

I’m skipping to near the end of the talk, and am putting this image in mainly to encourage you to read the lecture step-by-step.  But look at all the steps in Tao's model of the development of mathematical knowledge.

 Figure 4

 

He identifies six distinct processes. AI is doing a good job only on the first.  There's not reason to think LLMs will ever be able be independently decent on the final four, or even the final five. 

Universities exist to help society do that one and also the other five. Are they claiming a role in doing this right now?  

Society is now being held back by the tech sense of knowledge as a transactional problem solution.  If it “works,” tech says, that is, if there’s an answer that seems right, then the model by tech's definition has produced knowledge. 

By tech I mean finance as much as engineering.  Greg Jensen, co-CIO and head of AI research at Bridgewater Associates, an investment bank, went on the Bloomberg podcast Odd Lots to say that AI really could kill us all so it's like February 2020 for Covid, but meanwhile Bridgewater has increased their token spend 200x because it’s paying off so well. When asked, he offered no specific evidence for this, just a general assertion that the model is approaching some kind of total understanding of markets: to trade better than everyone else “you have to understand everything about humanity, everything about the world,” and, what exactly? He dangled the unverifiable possibility that the model is getting there. However, he added, neither the engineers nor the engineers understand the model’s operations. We don’t know what the model is doing but we do know it’s approaching a grasp of "everything about humanity," Jensen implies.

This actually makes no sense. And indeed, a different framework is what Jensen and I assume the AI-finance world are working towards. His key blurt was this: 

The AI itself is changing the game because the AI itself, now there are more and more AI agents trading markets, mostly in the short term, but over time, in the longer term, time frames as well. And that makes the whole past that most AIs are trained on less and less relevant.

AI agents won’t produce knowledge about the world but will interact with all the other AI agents in creating a "world" through patterns of trading and supposedly all other monitorable activities. The “reasoning” will be basically opaque, and it will not be about the world but about the patterns identifed by the other agents. The overall operation will be a version of Baudrillard’s simulacra rather than  a representation of humanity or the world. This is similar to what some critical scholars have been saying about finance for a while, and all the more reason for us to produce knowledge to counter it rather than mistaking it for knowledge. 

Meanwhile, it's not like human intelligence is accelerating to match the LLM version. As though on cue, the Organization for Economic Cooperation and Development (OECD) released its 2025 PISA test results. PISA stands for Programme for International Student Assessment, and the overall results show long term decline, starting around 2012 and accelerating after Covid. There are exceptions—England’s results have stabilized, and Mississippi’s have almost caught up to the US.  But the overall picture is terrible.

 Figure 5

 Many factors are at work here—smart phones, underinvestment, pedagogical flaws, and my personal favorite, widenting cultural doubt about the value of knowing things. It became clear during 2025 that AI is also contributing to cognitive loss. Evidence mounts: one watershed paper this summer was called, “The Generative AI Learning Penalty: Evidence from Chinese Secondary Education.” The study found large effects, and a familiar, disturbing pattern in which immediate increases in task productivity (completing homework) veils longer-term erosions in learning (measured here by exam scores).

The AI industry's periodic glorying in their fearsome engines allows them not to address how their existing products already have the power to make so many things worse—employment, environment, and also learning and the resulting human intelligence. 

Universities are waking up to their premature abandonment of hardcore intellectual development, or, I should say, some faculty groups in some universities have. On the one hand, Miami U of Ohio is AI-partying like it’s 2023.  On the other, MIT’s Ad Hoc Committee on AI Use calls for semi-abolition of LLMs in a whole range of learning processes that are to shift to brain-only.  They are right, and Miami University is wrong. The more insecure parts of higher ed must catch up to MIT sooner rather than later.

But this will not be enough, the limited return to brain-only learning.  It doesn’t get at the intersubjective or social nature of knowledge—“knowing things” plus “doing things with what you know.”  Society is being held back by the tech sense of knowledge as a transactional problem solution. Thinking and knowing are modes of collective labor. 

If universities do not side with the knowledge community against the appropriation of its outcomes and its practices, they will be useless in the current moment.  They should openly chose that side.