Could Suddenly-Great Open Source AI Crash the US Economy?

Not sure why I haven't thought more about this, but it seems like the US now has a massive economic vulnerability from cheap, high-quality, open source AI combined with cheap inference (See Cerberus, et al).

Here's the scenario:

• US labs get people and companies hooked on top-tier inference ✅
• The entire US economy re-orients to center around like 5 companies
• Their valuations keep growing while stealing the oxygen out of everything else ✅
• The open source models start getting pretty good, and they get used a lot, but they're still like 5-10% behind the frontier models ✅
• And then all of a sudden, in 2026, 2027, or 2028...they're not worse anymore. They're now as good or better, for as cheap or cheaper. □

For builders and companies and AI in general this is still amazing. It's still AI doing AI disruption things.

But for the US economy it seems like it could be really bad. Especially for the model providers, since companies like NVIDIA and Cerberus and such can still be the chips that whatever runs on.

It makes me wonder if the recent purchases of consulting and services providers by the labs is less of a,

let's compete with our customers because we're assholes...

and more of a,

um, we need to have traction as something other than a model provider if that market gets imploded by open source and boutique inference chips...

Basically I was tracking open source AI and the dedicated inference providers as points of curiosity and interest.

But now it seems like, unless I'm missing something major, them hitting parity or beyond vs. our pinnacle models could be catastrophic not just to 5 American companies, but to the whole US economy.

Now that I think about it, maybe it also adds some light to why China is going so hard on aggressive distillation of American models into open source, and constantly putting out high-quality, cheap alternatives for the world to use. With full descriptions of the techniques, and the weights, and the data.

Maybe that's because they want the world to catch up to (and pass) the US labs as fast as possible.

This makes their open source play look less like just a different path to AGI, and more like a direct strategic AI play against the US economy.