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Money and Markets: Investing Insights

Pentagon Funds Our Future Robot Overlords

Jon Markman | Tuesday, August 16, 2016 at 7:30 am

Jon Markman

In dystopian science-fiction movies, it always starts this way: The Pentagon funds a contest of machines built to play war games using artificially intelligent software. End of civilization ensues.

This time, in real life, teams of enthusiastic young hackers met in Las Vegas at DEF CON, also known as "the world series of hacking." It takes its name from the numerical naming sequence for defense alerts — from DEF CON 1 (lowest state of readiness) to DEF CON 5 (nuclear war is imminent).

But at its heart, DEF CON is really just a computerized game of Capture the Flag. The idea is to find, plug and defend security holes in your own server while seeking and exploiting the vulnerabilities of other teams’ servers.

Players get bragging rights, a shot at winning some cash and a showcase for their talents in the contest sponsored by the U.S. Department of Defense’s brain trust in the Defense Advanced Research Projects Agency.

This year’s DARPA Cyber Grand Challenge, at the Paris Hotel on the Vegas strip, reimagined that concept with code-writing, artificially intelligent, software-robots running on supercomputers.

AI as a science is gaining momentum because researchers understand the potential of thinking software. In theory, it could recognize context and create solutions on the fly, saving humans the time and trouble. While that’s all well and good, there is another way to think about artificial intelligence. And it’s not good.

The robot was a loyal servant in the classic ’60s sci-fi TV show Lost in Space, but Stephen Hawking fears real-life won’t imitate art.

Although he suffers from ALS and needs AI software developed by Intel (INTC) to communicate, renowned physicist Stephen Hawking worries such software would lead to a constant state of reinvention for machines. The growth of intelligence would be exponential, only constrained by irrational, slow-witted human overlords.

To promote pure efficiency, thinking machines might even have a motive to eradicate humans. As Hawking puts it: "A super intelligent AI will be extremely good at accomplishing its goals, and if those goals aren’t aligned with ours, we’re in trouble."

The organizers of the Cyber Grand Challenge see things differently. The Pentagon-funded event spent $3.75 million in prize money and another $55 million organizing. That entailed recruiting seven teams of security researchers from industry to academia, then designing and building supercomputers for each team as well as software that could monitor their software bots in real time. It was all very impressive and, according to organizers, well worth the money spent.

One software bot even managed to find and inoculate the Crackaddr bug, a piece of decade-old malware that had never been cracked before by a non-human.

A bot programmed by engineers from Raytheon (RTN) played an especially aggressive game. After it patched holes on its own server, it pounced on exposed vulnerabilities on multiple fronts, scoring points. However, its own deficiencies ultimately slowed processing power.

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In the end, the contest winner came from Carnegie Mellon University. Its bot, named Mayhem, took the opposite approach. It ran up an impressive lead early on offense before effectively shutting down halfway through the competition.

The commentators reasoned the bot chose this strategy because it determined there was no further benefit to be derived by patching and exploiting new holes. The most prudent course of action was to simply wait as other teams exposed vulnerabilities and could no longer effectively respond.

While it is impressive that a piece of software can reason at all, it’s also disconcerting. I don’t want to seem like an alarmist or pessimist given the very bright investment outlook for new technologies. Yet I hope the next wave of artificially intelligent software doesn’t simply wait for humans to reach the point where we can no longer respond to exposed vulnerabilities. That would not lead to a Hollywood ending.

Best wishes,

Jon Markman

Jon began his career as editor, investment columnist and investigative reporter at the Los Angeles Times. As news editor, his staffs won Pulitzer Prizes for spot-news reporting in 1992 and 1994.

In 1997, Microsoft recruited Jon to help launch MSN’s finance channel, where he served as Managing Editor. In that capacity, Markman became the co-inventor on two Microsoft patents.

From 2002 to 2005, Jon served as portfolio manager and senior investment strategist at a multi-strategy hedge fund.

Since 2005, Mr. Markman has specialized in helping everyday investors buy tomorrow’s technology superstars BEFORE they skyrocket.

Mr. Markman is the author of five best-selling books, including Reminiscences of a Stock Operator: Annotated Edition; New Day Trader’s Advantage, Swing Trading and Online Investing.

{ 11 comments }

J. T. Lawson Tuesday, August 16, 2016 at 12:01 pm

Jon, you have it backwards. DEFCON 5 is the lowest level (or base level) of readiness on the DEFCON scale. DEFCON 1 is the highest level. For a good explanation, see http://www.wikihow.com/Understand-the-Defcon-Scale

Tom Fratello Tuesday, August 16, 2016 at 12:31 pm

I was there when AI computers were first invented. Before you start predicting the end of the world caused by AI computers realize this. They are all based on a set of rules the computer follows that are first programmed into it by the human programmer. The computer can modify and amplify the rules based on (you guessed it) rules established by the human programmer. Computers don’t inherently create software on their own, someone is guiding them with “rules”. Hope this information puts the AI situation in perspective.

Paul Sundling Tuesday, August 16, 2016 at 3:16 pm

It’s a common mistake to make, but yes totally has it is backwards. I guess us older folks that grew with the movie War Games don’t forget the correct values. Think of it as a countdown to nuclear war, like how many minutes to midnight.

I do have a reference to DEFCON in my upcoming novel, The Internet President: None of the Above.

https://en.wikipedia.org/wiki/DEFCON

Paul Sundling Tuesday, August 16, 2016 at 3:21 pm

There is a primer on this topic that I highly highly recommend, even for those familiar with AI. It’s probably the best explanation I’ve ever read of all the implications mentioned in this post.

http://waitbutwhy.com/2015/01/artificial-intelligence-revolution-1.html

johnfromojai Tuesday, August 16, 2016 at 3:54 pm

Any country that spends more on the military than it does on it’s own people is at danger of being economically and spiritually bankrupt. Martin Luther King said something like that and it looks like we’re almost there. Only one political candidate offers a shift from our bankruptcy and that is Jill Stein. I hope the country comes to its senses in time.

Al Thursday, August 18, 2016 at 9:24 am

JohnfromOjai has it backwards for several reasons. In any real world, the following has always been true, whether it’s about countries or people:

1. The only thing more costly than maintaining a strong Defense capability is losing everything you value – your life and way of life, freedom, property – is the cost of losing everything because you didn’t have a strong Defense.
2. Maintaining a strong Offense capability is essential because corrupt and despotic governments and their ‘leaders’ always will say, do, promise, and threaten anything to maintain and expand their power and influence. Man or beast, a bully won’t back down until or until face with a superior force.
3. Countries, like people, with the most to protect, also have the most to lose when they don’t protect themselves against all enemies, foreign and domestic. [If some of that sounds familiar, you may have read the US Constitution or the oath of office for US military.]
3. Those who don’t learn the lessons of history are doomed to repeat history. (History, like survivors, goes to the victors. (Cited numerous times since ancient world history..)
4. People and countries willing to trade freedom for security soon will have neither. (Cited numerous times since ancient world history..)
5. Prayers and good intentions never stop knives, spears, bullets, bombs, or any enemy determined to use them. (Cited numerous times since ancient world history..)

John should question the elected officials, especially the political commissar in the white house: Why is the US military budget, facilities, and personnel being bloated by the political commissar in the white house to transport, house, feed, school, and give ‘free’ medical aid to illegal alien ‘minors’? Why is military training and military preparedness being diverted to achieve ‘political social objectives’ ? …. When at the same time numbers of military personnel and their benefits being reduced?

Steve McNeil Tuesday, August 16, 2016 at 5:08 pm

Years ago, Electronics Design magazine had an April Fool’s issue where IBM had made a dramatic breakthrough: Artificial Stupidity.

Luciano Salvati Tuesday, August 16, 2016 at 5:48 pm

How many times has the HUNTER become the HUNTED ?

Cadent D. Allvice Tuesday, August 16, 2016 at 7:30 pm

If you stand in the way of progress, then you stand to be run over… seen from a robot’s perspective.

Peter W Wednesday, August 17, 2016 at 10:09 pm

I suppose when u combine AI with the biological ability to grow human organs; how close are we to creating human robots…humanoids if u will? U could manufacture ur own army or slaves…hell u could go back in history to ancient Greek city-states and recreate the so-called “cradle of democracy”…give me 20,000 of these humanoids and I will have the greatest capitalist democracy on the planet earth…by the way I am NOT Donald Trump but I play him on my cable tv show…CHUMP INSANITY…Thanks for the info in the article!

James C Thursday, August 25, 2016 at 4:57 am

Economics is a social science. At the end of the day, applied economics and policy analysis are all about ways to improve human well being. If this is done by artificial intelligence aka robots so be it.

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