Michael Roberts: AI and productivity

AI and productivity

Alphabet (Google) announced its earnings results yesterday.  At first sight, the results were spectacular: revenue was up 24%, with revenue from its ‘cloud’ business up 82%.  Earnings per share were $9.11, which is very high.  But more than two-thirds of those earnings were based on booking $77bn from ‘unrealised’ gains from its purchase of shares in Anthropic, a major AI model firm.  In other words, these ‘gains’ are just ‘on paper’ and depend on Anthropic shares staying up.  

Google is one of the so-called ‘hyperscalers’, the mega tech companies that are ploughing huge of amounts of funds into AI, hoping and expecting it to lead to a sharp rise in profits down the road.  Google’s investment in AI has pumped so much money into AI companies like Anthropic and OpenAI and into data centres to run AI with expensive ‘chips’ made by Nvidia, that its huge cash revenues are no longer covering the cost of investment. ‘Free cash flow’, as it is called, went negative for the first time in Alphabet’s history.

Google is increasing its AI investment massively this year, like its rivals, Meta, Microsoft and Amazon, to build AI infrastructure, with the four hyperscalers combined on track to spend more than $725bn in 2026. Before Wednesday’s results, Google had been seen as the hyperscaler best placed to withstand the AI arms race, with cash flows from its vast search business expected to cushion the financial pressure. But now, its cash burn to fund AI capex will require raising debt and/or issuing equity shares. Alphabet has already taken on nearly $100bn in debt, and in June it moved to raise about $85bn in its first share sale in more than two decades.

All this tells us that the AI stock market ‘bubble’, and that is what it is, is getting closer to bursting. The hyperscalers are hugely profitable, based on their existing businesses, with current earnings about 59 per cent above trend.  But such is the size of the AI investment boom being conducted by these hyperscalers, that even these profits are being sucked into AI like water disappearing into the Sahara desert.

As argued in previous posts, the US economy is one big bet on AI.  The stock market value of the hyperscalers now accounts for roughly 40 per cent of the S&P 500’s total market capitalisation. If there is any sign that: first, they cannot sustain their current investment growth; and second, they are eating away their profits with no return on those AI investments, their stock values could turn south and take the whole stock market with them.

The US capitalist economy is balanced on the apex of AI.  All will be well if: first, the AI models become in heavy demand and start to be used across companies in the US and globally, thus boosting profitability for the hyperscalers and eventually the rest of the corporate sector.  Second, the generalised use of AI technology in all sectors of the economy also leads to a step change in the level of productivity, which can take the US economy into a new age of prosperity.

Before the advent of the AI boom, the US information technology had already become the driver of relatively faster economic growth in the US compared to the rest of the G7 economies during the Long Depression of the 2010s.

But in the 2010s, all the G7 economies, including the US, saw a slowdown in the growth of real GDP output, investment and productivity. Then, after the pandemic slump, inflation returned in most economies, threatening to introduce a new period of ‘stagflation’ (slow or no growth alongside faster and high inflation) not seen since the 1970s.  Now the Iran war is accelerating energy price inflation. Central bank monetary policy failed to get economies going in the 2010s with low or zero interest rates and monetary injections (quantitative easing).  And central bank monetary policy is failing to keep inflation from rising since 2020 using higher interest rates (ECB) and quantitative tightening (BoE).  That’s because the only way economies can grow without inflation rising is by increasing growth in the productivity of labour.

The new Trump-appointed chair of the Federal Reserve expects a productivity boom from AI.  Kevin Warsh says that “AI is perhaps the most significant change in our economy in my adult lifetime. AI will be a significant disinflationary force, increasing productivity and bolstering American competitiveness.”  He reckons that productivity improvements from AI would drive “significant increases in real take-home wages. A one-percentage-point increase in annual productivity growth would double standards of living within a single generation.”  He is right. Even just a 1% point rise in current US productivity growth over 20 years would not only keep inflation down, it would provide income and revenue that could end the deficits in government budgets, without raising taxes or making cuts in spending.  Public debt to GDP ratios would fall.

But will AI deliver this step change in productivity?  From 2005 through 2019, US productivity growth averaged about 1.5% per year. The pace remained similarly slow during and immediately after the pandemic (2020-2022).  But US labour productivity has accelerated since 2022. Output per hour grew around 2.5% per year from the end of 2022 to the start of 2026, exceeding its pre-pandemic pace by 1 percentage point.

So is AI delivering?  Most of the acceleration in labour productivity growth comes from faster growth of what mainstream economics calls total factor productivity (TFP). TFP is not something real that can be measured; it is just a mathematical residual from analysing the drivers of productivity growth. More workers working harder plus more machines working longer is what delivers most productivity from labour. TFP is the residual that is assumed to be from the impact of ‘innovation’ (eg AI).  

But the rise in US TFP is not yet the result of AI application in the economy.  According to economists at Barclays, AI adoption has been gradual and steady rather than rapid and transformative, with most households and businesses still reporting limited exposure to the technology. The rise in productivity growth since 2022 is really due to more intensive use of existing technology after the end of the pandemic, not the introduction of AI. 

How do we know this?  Well, Barclays economists looked at the St Louis Fed’s nationwide Real-time Population Survey (RPS) of working-age US adults. The most recent survey shows that, while AI has found its way into work routines for 45 per cent of respondents, the usage of AI in time is miniscule. Assuming an eight-hour workday, the average AI adopter has gone from roughly 20 minutes of usage in late 2024 to around 30 minutes by mid-year 2026, the RPS survey shows. And what’s not known is whether the workers are using their extra 2 per cent of work time per day to be more generally productive, or to verify and fix whatever the AI has produced, or to slack off!

Indeed, most surveys of AI adoption by companies show only modest progress. The US Census Bureau’s bi-weekly Business Trends and Outlook Survey shows just 21 per cent of businesses were knowingly using AI, 69 per cent reported no use, and 11 per cent weren’t sure either way! A Fed Board of Governors discussion paper finds that “productivity trends across all three levels have been relatively consistent over time, suggestive of micro-level productivity gains not adding up in aggregate.”   It seems that ‘micro-level’ experiments typically measure task-level productivity, like the speed that a programmer generates code, rather than job-level or firm-level output. A 10% improvement on a task does not necessarily lead to proportional gains for a firm if adjustment costs or other bottlenecks lie elsewhere in the production process and erode the upstream productivity gains.

By running a series of complicated regression analyses on RPS survey data, the US Fed found that no evidence that AI’s doing anything positive: correlations between industry-level adoption rates and improvements in productivity are “not statistically distinguishable from zero”, it says. Any observable improvement “largely reflects persistent differences across industries rather than a measurable acceleration in productivity growth attributable to AI”.

However, the AI optimists remain just that – optimistic. They refer to the ‘J-curve’ that the productivity impact of new technologies generally follow.  First, there is a slow, even negative, effect on productivity as companies invest heavily in the technology. And then the boom comes. Such a J-curve was seen in US manufacturing productivity growth, which fell in the mid-1980s and then, after the recession of 1991, accelerated sharply until the mid-2000s.

But even that optimistic view has its caveats. First, it seems that those workers exposed to AI are resisting its use. An April survey of 2,400 knowledge workers by AI firm Writer and Workplace Intelligence—both firms with commercial stakes in AI adoption — found the 29% of employees admit to actively sabotaging their company’s AI strategy. Among Gen Z (under 25) workers, that figure was 44%, up from 41% a year earlier. A separate WalkMe survey of executives and employees across 14 countries, conducted the same month, found that more than 54% of workers had bypassed their company’s AI tools in the past 30 days to do the work manually instead. The survey commissioners found that a “Fear of Becoming Obsolete” is driving much of this active and passive, and even passive aggressive resistance. Similarly, The Economist reported that AI usage among US workers, after an early spike, dipped as initial enthusiasm faded. 

In the early 19th century at the start of the industrial revolution in Britain, a group of skilled weavers tried to resist the introduction of machine weaving in the early 19thcentury by various means, including sabotaging and wrecking the machines. They were called Luddites. Now it seems that a form of Luddism has returned over AI. Just as the Luddites had a case about protecting their livelihoods, so do Gen Z workers now. 

The AI optimists, Stanford’s Erik Brynjolfsson and ADP Research, are tracking 4.6 million workers across more than 730 occupations through their Canaries Dashboard. They find that jobs for workers aged 22 to 25 in AI-exposed occupations are shrinking more than 4% annually.  Goldman Sachs analysis suggests information, professional services, insurance, and finance are best positioned for early productivity gains—but these are where the ‘sabotage’ surveys find the highest rates of resistance.

Goldman Sachs US economist Elsie Peng supports the J-curve thesis for AI.  Her study of industry technology adoption found a modest drag for the first four years, statistically significant gains only after eight, and a peak impact of roughly 0.6 percentage points in year 12. If ChatGPT’s 2022 launch is the equivalent of the PC’s 1981 debut, that J-curve puts the productivity payoff arriving around 2030 at the earliest, and peaking around 2034.  According to Peng’s analysis, significant labour productivity boosts from ICT didn’t show up until roughly 50% of businesses had adopted the technology. Not bought it, not piloted it. Actually adopted it into their core operations.

Peng’s ‘J curve’ echoes what the OECD’s economists argued some time ago, that transformative technologies historically take about 20 years from their breakthrough moment to deliver meaningful productivity gains at the macroeconomic level. If that pattern holds for generative AI, we’re looking at the early-to-mid 2030s or even later before the real payoff arrives. So there is a long way to go for generalised AI that can deliver a significant rise in labour productivity growth.

The step change in productivity growth that Fed chair Warsh puts all his hopes on still seems some way off. But what about profits from AI?  So far, any revenue that the AI model companies are making is way, way short of covering the costs of AI R&D development and the building of data centres all over the US. And Goldman Sachs estimates that each dollar of ICT hardware investment requires at least another $1.70 of complementary “intangible” investment—software, data systems, and the hardest category to measure, organizational overhaul. There is now 15 times more data centre capacity than the demand to use them.

And debt is building up. Bloomberg estimates that there’s over $500 billion in outstanding AI data centre debt. Nikkei Asia reported this week that Meta, Google, Amazon, Microsoft and Oracle have accrued around $1.65 trillion in outstanding debt in the last five years, with an additional hundreds of billions of dollars’ worth of “off balance sheet” debt, meaning that the corporate structure allows the company to not include it as part of its liabilities. 

What revenues are being collected by the likes of OpenAI and Anthropic are just coming from the hyperscalers’ investments in their operations. There are no profits at all being made from the use of Chat GPT or Claude, partly because the AI companies are not charging the proper cost of using ‘tokens’ (compute units) to the users. So the AI companies are now trying to switch consumers from flat fees to usage-based pricing.  But this has led to an exponential rise in the cost of using AI for companies, such that companies faced with ballooning AI bills are moving from“token maxxing” to ‘token rationing’.  And US companies are switching to using ‘open-source’ AI models coming out of China that can nearly match the performance of the US models at a fraction of the cost.  

First, there was DeepSeek that strikingly hit the industry back in early 2025.  Now there is the newest Chinese AI model, Kimi K3, just released by the Beijing-based startup Moonshot AI.  Chinese models are 112x cheaper than Anthropic per million tokens (ie. “barrel of intelligence”). One token costs $56 from Anthropic, $26 from OpenAI, $1.50 from Meta, $1 from xAI and Google, and $0.50 from the Chinese models.  No wonder the proportion of tokens used by US firms that run through Chinese AI models is up to a record 58%. American companies now use Chinese AI models more than US-made ones.

But the optimists have not given up. Some suggest the so-called Jevons paradox that argues that increased efficiency (from AI) will lead to increased demand as unit costs of spending on AI falls.  That will generate the profitability that AI companies are seeking and the stock market is hoping for. But only 2% of S&P 500 companies mentioned AI productivity during Q1 2026 earnings calls. And among those that did, the focus was overwhelmingly on cost savings rather than revenue growth. This raises serious questions about how the hundreds of billions in investment can be expected to turn into profits, let alone revenue. 

The AI bet rests on two big assumptions. The first is that AI will be profitable – eventually. But just because a technology leads to a huge increase in productivity doesn’t mean it will generate strong returns. The second assumption is that there will be widespread demand for AI, and soon. AI adoption has risen, but it is still a long way from peak adoption. As above, Goldman Sachs estimates that it could take as long as 15 years; the OECD says 20 years.  Can the current AI companies survive that long; can the stock market wait that long before the bubble bursts? 

Israel: Religious Mythology and Settler Colonialism

John Clarke

Toronto

7-23-26

 

Herzog's claim to be a proven descendant of King David is completely absurd. He has a name that originated in Europe and any cursory check will show that the existence of David is debatable. Just as significantly, the historical role this king is supposed to have played is unsupported by any evidence outside of the scriptures. Indeed, Herzog's own claim is based on rabbinical writings.

This use of religious myth as if it were serious historical evidence is something that the Zionist movement and the Israeli educational system has concentrated on to a huge degree. Moreover, while Herzog's claim would be met with hoots of derision throughout the Global South, such has been the level of support for the Zionist political ideology in the West that he is taken seriously when he lets fly with this nonsense.

 

Such irrationality isn't the unique preserve of Zionism and its colonial project of course. All forms of settler-colonialism have based themselves on a claim (often divinely mandated) to take someone else's land on the basis of alleged superiority. The co-option of religious tradition created particular notions of return to a God given homeland but these ideas aren't fundamentally different to those used to justify dispossession in other places, including Canada.

 

It is inherently futile to debate religious ideas and, if the groundless belief that he is descended from a mythical ancient King who worked closely with the Supreme Being gets Herzog out of bed in the morning, good luck to him. 

 

The problem arises when such ideas are put into effect at the expense of others. Herzog's role in the Gaza Genocide and the broader dispossession of the Palestinians show very clearly that he has crossed this line with terrible results.

 

The issue, then, isn't to focus on refuting the distorted and mythical elements of the Zionist ideology but to directly challenge the ethnic cleansing, apartheid and genocide that have resulted from their application. We need to take into our efforts to end Western sponsorship and material support that is so essential for Israel, a clear opposition to the criminal injustices that have arisen when this ideology has been put into practice.

Republished from Trita Parsi on Substack.

The US-Saudi nuclear deal makes no sense

How will Washington get Tehran to accept intrusive inspections beyond the JCPOA when Saudi is offered enrichment with no IAEA inspections? 

Trita Parsi July 22nd 2026

AP Photo/Evan Vucci

A few points on the shocking U.S.–Saudi nuclear deal announced.

1. This reflects a weaker American bargaining position, not a stronger one.

The broader context is China. The Biden administration pursued a nuclear deal with Saudi Arabia, as part of a broader expansion of Trump’s Abraham Accords, in part to pull Riyadh closer to Washington and away from Beijing. But Washington’s position has deteriorated since then. The credibility of the U.S. security umbrella has weakened, GCC states have become more strategically autonomous, and Saudi Arabia has gained leverage by diversifying its partnerships.

The result appears to be that Washington had to offer substantially more to try to keep Saudi from drifting further toward China, while getting substantially less in return.

2. By any historical standard, this is an extraordinary Saudi victory.

Compared to previous negotiations, Riyadh has secured remarkable concessions. It no longer appears to have to normalize relations with Israel as part of the package. It is reportedly not required to sign a traditional Section 123 agreement that would deprive KSA of enrichment technology. And there are no comprehensive IAEA safeguards comparable to those Washington has long insisted upon elsewhere.

If these reports hold, Saudi Arabia has achieved what few thought Washington would ever accept.

3. Biden was going down the same path…

The Biden administration reportedly considered similar arrangements, but its efforts were derailed by the repercussions of the October 7 attacks.

Biden officials also understood the risks, although it did not prevent them from pursuing it and signalling willingness to offer Saudi major nuclear concessions. Some of the contingency ideas reportedly discussed bordered on the surreal: having American troops physically guard Saudi enrichment facilities from the Saudis themselves, or designing systems that would allow the United States to disable—or even destroy remotely—the facilities if necessary.

The fact that such safeguards were seriously contemplated should itself have been a warning. If your proposal requires extraordinary mechanisms to prevent your own ally from using the technology you are providing, perhaps the proposal is fundamentally flawed.

4. This may prove a stepping stone toward an even greater disaster: Security Guarantees for Saudi

As Rosemary Kelanic points out, this deal provides Riyadh with leverage it can use in the future to force Washington to provide it with security guarantees. Saudi Arabia can threaten to build nuclear weapons unless the U.S. offers it Article 5-level security guarantees - a disastrous move that would further entangle the US in the region militarily instead of allowing America to come home from the Middle East.

As Kelanic argues, there is ample historical precedent. South Korea and West Germany both advanced nuclear programs that alarmed Washington. Rather than allowing them to acquire nuclear weapons, the United States ultimately strengthened its military commitments and security guarantees in exchange for abandoning those programs.

As a result, this nuclear deal may prove to be a prelude to an even more damaging concession to Saudi down the road.

5. This likely weakens Washington’s negotiating position with Iran.

If there is eventually another U.S.-Iran nuclear agreement, today’s decision establishes an entirely new benchmark.

It becomes impossible to argue that Saudi Arabia may enrich uranium while Iran cannot, although Tehran was never going to accept zero enrichment in the first place. But proposals that earlier had been entertained - such as a 5- to 10-year moratorium on enrichment - may now also be out of reach.

Moreover, and perhaps more importantly, it becomes harder to insist on intrusive international inspections for Iran while accepting a far lighter non-IAEA inspection regime for Saudi Arabia. And it becomes much more difficult to portray enrichment itself as an unacceptable proliferation risk.

Washington has made the type of deal it wants from Iran more complicated.

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6. Israel has every reason to be deeply unhappy.

Much attention will focus on the loss of the Saudi normalization card, which has been one of Israel’s strategic objectives.

But the more consequential issue may be that Saudi Arabia now appears to have a far more credible pathway toward a nuclear weapons capability should it ever choose to pursue one.

That represents a fundamental shift in Israel’s long-term strategic environment.

7. Is this about widening the war with Iran?

Possibly. One interpretation is that Washington made these concessions to secure greater Saudi cooperation in the current (or a future) confrontation with Tehran.

But Tehran itself does not appear particularly alarmed.

Saudi Arabia’s direct military contribution to a war with Iran would likely remain limited, and the Kingdom’s participation does little to alter Iran’s fundamental geographic advantages in the Persian Gulf. More importantly, Saudi leaders have spent years trying to reduce—not increase—the risk of becoming a battlefield in a U.S.-Iran conflict.

If that remains Riyadh’s strategic priority, this agreement is unlikely to fundamentally change the military balance in the war.

Taken together, it is difficult to see today’s announcement as advancing US interest, let alone being compatible with other existing efforts such as finding an acceptable resolution to the conflict with Iran. It raises further questions as to whether a cohesive Middle East policy exists.

The Senate Appropriations Committee Hearing Proves the Democrats Don't Oppose the Iran War.

Richard Mellor
Afscme Local 444, retired.
7-22-26 

As I pointed out yesterday, Pete Hegseth, the Secretary of Defense in the Trump administration, was questioned during a Senate Appropriations Committee hearing. The administration is seeking another $87.6 billion in military funding, arguing that increased spending is necessary to sustain the U.S. war against Iran.

The administration appears to have expected that its campaign of air strikes and the assassination of senior Iranian officials would quickly weaken the Iranian government and force it to capitulate. Instead, the conflict has intensified. As of July 21, U.S. forces had conducted air strikes for ten consecutive nights, while Iran had retaliated by attacking a U.S. military installation in Jordan.

The war is becoming increasingly unpopular at home as its financial costs and economic consequences are felt by American families. According to an Ipsos poll, 71% of Americans think their country should not be involved in the Iran war and this rises to 79% for those aged 18-34.”. Globally, results are similar. Naturally one of the few countries that support it is Israel.

This growing public dissatisfaction is creating tensions within the Republican Party and providing political ammunition for Democrats ahead of the November elections.

Watching the committee hearing, however, it becomes clear that Democratic Senators Gary Peters and Jon Ossoff are not challenging the war itself. Their criticism is directed at what they regard as the Trump administration's failure to prosecute it effectively. Again and again, the focus is not whether the war should have been launched, but whether there is a coherent strategy for winning it.

Both senators begin by praising General Dan Caine, Chairman of the Joint Chiefs of Staff, and expressing condolences for the three U.S. service members killed when Iran retaliated against American bombing raids. Neither senator questions the legality of the war itself, argues that it was unnecessary, or calls for an end to it and an apology to Iran. They don’t even call for an immediate ceasefire and negotiations. Nor do they challenge Hegseth's claim that Iran is the principal sponsor of global terrorism a long time US foreign policy strategy when the US  and the CIA is seen by millions of people around the world as the leader in that category.

In my view, this is the conclusion we need to draw from the hearing. The disagreements between the administration and its Democratic critics concern tactics and competence rather than the broader objectives of U.S. foreign policy. The debate is over how the war should be conducted, or managed, not whether it should continue. It’s basically more propaganda.

Peters, who frequently speaks about the importance of his Christian faith, and Ossoff, who has spoken publicly about his Jewish faith, express sympathy for American casualties but none for the suffering endured by ordinary Iranians. Whatever their religious convictions, humanitarian concern appears to stop at America's borders. 

 

A conservative Christian friend of mine recently remarked that politicians are simply corrupt. Many trade union members express similar frustration with union leaders that they believe have become detached from the workers they represent and claim the reason is corruption, that they are in bed with the boss or receive bribes. While I understand that sentiment, I believe the problem runs deeper than individual corruption. It’s connected to their world view.

As far as the Democratic and Republican parties go, they represent different wings of the same economic system. Their disagreements usually concern how American capitalism should be managed rather than whether its underlying priorities should be challenged. Foreign policy is perhaps the clearest example. Peters, often described as a centrist Democrat, and Ossoff, generally regarded as more progressive, ultimately support the same strategic framework as Republicans, even while criticizing the administration's execution of it.

This point became especially clear during Peters' exchange with Hegseth. Peters praised the professionalism of American service members before criticizing the administration's handling of the war. Hegseth responded that such criticism undermined those risking their lives, insisting that the military operation was necessary to ensure Iran never acquired a nuclear weapon.

Whether one accepts that justification or not, the exchange illustrated the narrow limits of debate within Washington. The central assumptions of American foreign policy are not confronted; not even questioned.

It is this consensus that helps explain why so many Americans have become cynical about politics. Public dissatisfaction is often described simply as anger over corruption, but the deeper issue is that the political system rarely permits a fundamental discussion about whose interests government serves. During presidential campaigns, the debate is almost always confined to competing visions of how best to manage capitalism. The system itself is off limits.

Whoever occupies the White House after November, working people will continue to bear the costs of economic inequality, military spending, and foreign wars. Figures such as Steve Witkoff and Jared Kushner, Trump’s son-in law, are wealthy real estate speculators and Zionists negotiating on behalf of the American people. Let’s think for a minute that characters like these are quite prepared to invest in Gaza and build a fancy resort over the bones of perhaps hundreds of thousands of mur*dered innocent men women and children

I live in the richest and most powerful country in modern history. The American working class possesses enormous potential power, yet it also faces growing economic and political pressures. As capital operates increasingly through global institutions, working people will need institutions of our own that are independent of the two major parties and capable of acting across national boundaries. The US working class can play a major role in that but first we must settle accounts with our own rogue regime.

Time is running out.

Hegseth Wants More Money for the Iran War. A War Already Lost

US Bombed Girls school killing 168

Richard Mellor

7-21-26

 

US Secretary of War, Pete Hegseth, was at the Senate Appropriations Committee today pleading for more money to continue the unprovoked and illegal war the Trump menagerie and US Congress are waging against the people of Iran. 

 

I say the “people” of Iran as the US can’t be at war with the government or heads of state as the US rogue regime has mur*ered them. Apparently, the operation that was only supposed to last a day or so is not going as planned. 

 

Hegseth said the cost of the war was $25 billion back in April but has risen $12 billion in two months and is now estimated at a cost of $37.5 billion. Apparently the Iranians are prepared to defend their country against US aggression, even those who oppose the present government.

 

The Trump regime is asking for close to $70 billion for what it said in June were “operational costs”. At that time it threw a few billion at US farmers and a billion to renovate Penn Station in New York City, but make no bones about it, the US is losing the war it instigated against Iran and is asking for more money to continue it and in some way save face. The US is bringing in more air power and its running low on military hardware and needs to increase production and “delivery of high demand munitions.”

 

Hegseth says the extra funding is needed to achieve what he calls, “peace through strength.”, in the region. These requests are in addition to the $1.5 trillion the Pentagon wants in the upcoming defense budget. Pouring more money down the drain but more profits for the investors in the defense and fossil fuel industries.

 

But we are at a point in the game now where the vast majority of the people of the world, including millions of Americans, understand that the main source of violence and instability in the region is the presence of the US and its settler colony, Israel. In addition, Iran’s has shown it has the ability to inflict some pain of its own, primarily against US bases in the Gulf States, regimes acting as US imperialism’s flunkies in the region.

 

Much of the damage to US military facilities in the region that cost the US taxpayer billions to install and maintain has been hidden from the US public. The many forever wars the US has waged over the past three or four decades killing a few million people and displacing millions more, have been tolerated by the American people because the body count has been relatively low. The sacrifice of these corporate ventures with regard to loss of life has been borne by a small section of American families.

 

As I read the Pentagon’s request for more money in April, it “….included $21 billion for munitions. as well as $4 billion for a new program that would launch a group of satellites to track airborne targets from orbit.”

 

One can only Imagine what we could do with that money here at home. Or even using it to help others in other countries as opposed to using it to destroy their infrastructure, kill their people and bomb them to the stone age.

 

Hegseth’s statement about peace through strength is the same old rhetoric. Peace doesn’t come from bullying and dominating others, but these are imperialist wars and US. Imperialism, albeit the most powerful military force in the world, is losing its influence on the world stage and is fighting to maintain its position.

 

Hegseth will likely get his way as the Senate Appropriations Committee is staffed by like minded people. Both parties of capitalism, Democrats and Republicans agree on foreign policy; they are both war parties. So what is actually happening is Hegseth is appealing to his colleagues for money, more accurately, our money. The US working class will foot this bill and desperately needed social services will suffer because of it. The Democrats will whine a bit given the opposition to this war among the public; some 64% are opposed to it from what I have read. But outside of taking to the streets we have no alternative in the political arena.

 

Hegseth said today that the Americans that died in an Iranian attack on a US military facility in Jordan, in response to 9 days of US bombing, “…should not be forgotten..”. What hypocrisy. These people do not care about the American people or young workers in the military. Hegseth, Trump and the warmongers in the US Congress are responsible for those deaths, Iran is not the aggressor here.

 

If this appeal for even more money for weapons of mass destruction, was a direct appeal to the millions of people in America whose living standards  have been savaged by both Republican and Democratic administrations alike, Hegseth would walk away empty handed.

 

I listened to that famous speech today by Mario Savio at a protest in Berkeley in 1964. It’s a powerful statement and is as valid today as it was then, even more so. 

 

“There's a time when the operation of the machine becomes so odious, makes you so sick at heart that you can't take part! You can't even passively take part! And you've got to put your bodies upon the gears and upon the wheels, upon the levers, upon all the apparatus -- and you've got to make it stop! And you've got to indicate to the people who run it, to the people who own it -- that unless you're free the machine will be prevented from working at all.” Mario Savio Berkeley 1964 

After "Political Terrorism" Event, U.S. Names 43 Americans + Groups |

Rubio report on Cuban "subversion" names Zohran Mamdani, Hasan Piker, Ben Cohen + orgs like DSA and Amazon Labor Union

Ken Klippenstein July 21 2026

Marco Rubio leads “The Resurgence of Political Terrorism” summit last week

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A new State Department report on Cuba’s “campaign of subversion against the United States” is a virtual government blacklist against left-wing Americans and groups. Linked to last week’s Rubio-led summit on “political terrorism,” the report is unusually candid about the government’s targets.

“Many of the most significant upheavals in recent American political history — from the George Floyd riots to the rise of Antifa to the explosion of pro-terrorist activism on American college campuses — can be linked, in some way, shape, or form, to Cuban influence,” the report says.

As for who these supposed American agents of Cuba are, the report is remarkably explicit. It names people like Ben Cohen (of Ben & Jerry’s ice cream fame), Mayors Zohran Mamdani and Karen Bass, media figures like Amy Goodman and Hasan Piker, and organizations like the Democratic Socialists of America and the Amazon Labor Union. 

The implication is clear: Secretary of State Marco Rubio thinks there should be a modern-day blacklist of the political left in America. In fact, the report explicitly mentions the “blacklists, McCarthy-era investigations and prosecutions” of the 1950s and their effectiveness at dismembering the Communist Party USA.

The 100-page report, titled “Cuba: The Capital of 21st Century Communism,” was released this morning.

	Cuba Report 44.6MB ∙ PDF file
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An entire section of the report — numbering over three pages long — is dedicated to the Democratic Socialists of America.

“The Democratic Socialists of America (DSA) serves as a particularly potent illustration of the ideological victory of Cuba’s effort to position itself as the spiritual capital of Third Worldist Radicalism,” the report says. “This represents a significant advance for the Cuban influence operation: Havana no longer needs to rely solely on intelligence penetration or asset cultivation to exert influence over the United States.”

Though the report concedes that “DSA was not shaped by the direct and tangible influence of the Cuban government” and that it has “organic ideological commitments,” it insists that “None of that is to say that the group has no ties to the Cuban regime and its influence network.”

Instead, the report points to the group’s delegations to Cuba as evidence of Cuban influence.

“For more than six decades, the Cuban regime has been the leading sponsor of radical leftism and Third Worldism in the United States,” Secretary of State Marco Rubio said in a post on X/Twitter linking to the report.

Whatever you think of DSA, it is hardly fringe. It claims as members prominent politicians like New York Mayor Zohran Mamdani and has helped to nominate dozens of politicians like him to office in recent years. Senator Bernie Sanders identifies as a Democratic Socialist — having himself popularized the term — as do Reps. Alexandria Ocasio Cortez and Rashida Tlaib, who are card carrying members (as well as Mamdani).

The Cuba report follows last week’s Rubio-led international summit on “political terrorism.” That summit, as I reported, introduced the new term “Far-Left Terrorism” (abbreviated “FLT”), a term it never really defined.

A White House press release summarizing the event said that “far-left extremism will be treated with the same seriousness and ferocity the world has long reserved for jihadist terrorism.”

Speaking at the summit, Rubio vowed that further new terrorist designations for left-wing groups would be coming “soon.”

Jeremy Lewin, the Under Secretary of State for Foreign Assistance, linked last week’s political terrorism summit to today’s Cuba report, saying on X: “For seven decades, the Cuban regime has been behind both the ideological underpinnings of third worldism and subversive organizing structures of the new radical left political terrorists that @SecRubio called out with clarity last week.”

But virtually all the summit could do to substantiate the supposed scourge of political terrorism was to focus on groups that are almost comically dated — like the 70’s era Symbionese Liberation Army or the Weather Underground. The summit was vague about what are the equivalent groups today. 

Today’s Cuba report, however, “names names,” in an obvious attempt to stigmatize American citizens who are very much politically active today.

In some cases these are even sitting politicians, from congresswoman Maxine Waters to Los Angeles Mayor Karen Bass.

I read the 100-page report and counted references to at least 43 contemporary American groups and individuals, which the report identifies as follows:

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• Adely, Suzanne: The president of the National Lawyers Guild who participated in the Nuestra América Convoy and who, the report notes, praised Venezuela’s 2024 elections.

• Amazon Labor Union: A labor union founded by Christian Smalls that participated in the 2026 Nuestra América Convoy to Cuba.

• Antifa: A decentralized group of self-described “Anti-fascist” political activists 

• Assata’s Daughters: A Chicago-based Black Lives Matter abolitionist offshoot that trains young activists in the radical spirit of Assata Shakur.

• Association for Investment in Popular Action Committees (AIPAC):A California-based umbrella nonprofit that funds left-wing media and delegations to Cuba and Venezuela.

• Bass, Karen: The current Mayor of Los Angeles and former Congresswoman who was a Venceremos Brigade organizer in the 1970s.

• Benjamin, Medea (Susan Benjamin): A co-founder of Code Pink and Global Exchange who previously lived in Cuba and frequently organizes solidarity efforts for the regime.

• Black Alliance for Peace: An activist group that maps U.S. military bases and police training facilities as targets for radical agitation.

• Black Lives Matter (BLM) (including Global Network Foundation, Grassroots, and at School): A sprawling racial justice network whose leaders and offshoots express solidarity with the Cuban regime and radical figures like Assata Shakur.

• Boudin, Chesa: The former District Attorney of San Francisco and son of Weather Underground member Kathy Boudin.

• changingFrequencies: A Black Queer Feminist-led abolitionist project aiming to disrupt waht it calls the “Medical Industrial Complex”.

• Claudia Jones School: A Washington, D.C.-based organizing collective that conducts popular education and pro-Cuba lobbying.

• Code Pink: Women for Peace: A left-wing protest group that describes itself as anti-war and organizes solidarity delegations to Cuba.

• Cohen, Ben: The co-founder of Ben & Jerry’s who attended the wedding of Neville Roy Singham and Jodie Evans.

• de la Cruz, Claudia: The co-founder of the People’s Forum, IFCO executive director, and 2024 presidential candidate for the Party for Socialism and Liberation.

• De Los Santos, Manolo: The co-founder and head of the People’s Forum who the report says maintains deep relationships with Cuban regime elites.

• Democratic Socialists of America (DSA): A major socialist political organization that formally advocates for the Cuban regime and organizes official delegations to the island.

• Ensler, Eve (V): A prominent playwright who attended the wedding of Neville Roy Singham and Jodie Evans.

• Equality for Flatbush: A Brooklyn-based Black Lives Matter abolitionist group fighting gentrification, police, and ICE.

• Evans, Jodie: The co-founder of Code Pink who married billionaire Neville Roy Singham and heavily praises anti-American foreign states.

• Floyd, George: A man whose 2020 death sparked nationwide uprisings that were celebrated and supported by the Cuban regime.

• Garza, Alicia: The co-founder of Black Lives Matter who credited Assata Shakur as a key influence in her organizing work.

• Goodman, Amy: The host of Democracy Now! who the report notes attended the wedding of leftist billionaire Neville Roy Singham and Jodie Evans.

• Haitian Women for Haitian Refugees: An activist group led by Black women that organizes to defend Black migrants and stop deportations.

• Hirsi, Isra: A campus activist and daughter of Ilhan Omar who was suspended from Barnard College for organizing anti-Israel encampments before traveling to Cuba.

• IFCO / Pastors for Peace: An ecumenical foundation that organizes aid caravans to leftist regimes and serves as a fiscal sponsor for numerous radical U.S. groups.

• Larudee, Paul: A U.S. citizen based in San Francisco who serves as the North American coordinator for the pro-Iranian “Resistance Axis” coalition Al-Tajammu.

• Mamdani, Zohran: Mayor of New York 

• National Lawyers Guild (NLG): An association of radical lawyers that provides legal defense and “legal observers” for various left-wing groups

• National Network on Cuba (NNOC): A coalition of over 60 American groups dedicated to lobbying for the Cuban regime and coordinating nationwide direct actions.

• Omar, Ilhan: A Democratic Congresswoman and mother of campus activist Isra Hirsi.

• Party for Socialism and Liberation: A leftist political party that fielded a 2024 presidential candidate and conducts protests.

• People’s Forum, The: An activist hub for anti-ICE and pro-Cuban agitation.

• Piker, Hasan: A streamer and left-wing political commentator who, the report notes, traveled to Cuba to film a documentary and participated in the Nuestra América Convoy.

• Pressley, Ayanna: A Democratic Congresswoman who, the report notes, publicly praised convicted murderer Assata Shakur upon her death.

• Singham, Neville Roy: A Shanghai-based American technology magnate who funds a massive global network of far-left activist groups.

• Smalls, Christian: The founder of the Amazon Labor Union who participated in the 2026 Nuestra América Convoy to Cuba.

• Thousand Currents: A progressive nonprofit that served as the fiscal sponsor for the Black Lives Matter Global Network Foundation.

• Villaraigosa, Antonio: A former Mayor of Los Angeles and Speaker of the California Assembly who was a Venceremos Brigade alumnus.

• Viva Palestina US: The American branch of an international network that, the report notes, previously provided convoys and funds to Hamas.

• Waters, Maxine: A Democratic Congresswoman who, the report notes, once wrote a letter urging Fidel Castro not to extradite fugitive Assata Shakur.

• Wilson, Diane: A co-founder of the anti-war protest group Code Pink.

• Witness for Peace Solidarity Collective: An organization that runs recurring U.S. solidarity delegations to Cuba.

Guilt by association at its finest. But what exactly are they guilty of? 

What the report shows isn’t that any of these people are knowingly taking directions from a foreign power — only that they disagree with the U.S. government on Cuba policy (or at most, agree with Cuba). 

Their views can be wrong — aggressively, offensively wrong even — but it’s their goddamn right as Americans to hold them.

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