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WIRED
15-07-2025
- Business
- WIRED
The Enshittification of American Power
Illustration: Petra Péterffy For decades, allies of the United States lived comfortably amid the sprawl of American hegemony. They constructed their financial institutions, communications systems, and national defense on top of infrastructure provided by the US. And right about now, they're probably wishing they hadn't. Back in 2022, Cory Doctorow coined the term 'enshittification' to describe a cycle that has played out again and again in the online economy. Entrepreneurs start off making high-minded promises to get new users to try their platforms. But once users, vendors, and advertisers have been locked in—by network effects, insurmountable collective action problems, high switching costs—the tactics change. The platform owners start squeezing their users for everything they can get, even as the platform fills with ever more low-quality slop. Then they start squeezing vendors and advertisers too. People don't usually think of military hardware, the US dollar, and satellite constellations as platforms. But that's what they are. When American allies buy advanced military technologies such as F-35 fighter jets, they're getting not just a plane but the associated suite of communications technologies, parts supply, and technological support. When businesses engage in global finance and trade, they regularly route their transactions through a platform called the dollar clearing system, administered by just a handful of US-regulated institutions. And when nations need to establish internet connectivity in hard-to-reach places, chances are they'll rely on a constellation of satellites—Starlink—run by a single company with deep ties to the American state, Elon Musk's SpaceX. As with Facebook and Amazon, American hegemony is sustained by network logic, which makes all these platforms difficult and expensive to break away from. For decades, America's allies accepted US control of these systems, because they believed in the American commitment to a 'rules-based international order.' They can't persuade themselves of that any longer. Not in a world where President Trump threatens to annex Canada, vows to acquire Greenland from Denmark, and announces that foreign officials may be banned from entering the United States if they 'demand that American tech platforms adopt global content moderation policies.' Ever since Trump retook office in January, in fact, rapid enshittification has become the organizing principle of US statecraft. This time around, Trumpworld understands that—in controlling the infrastructure layer of global finance, technology, and security—it has vast machineries of coercion at its disposal. As Mark Carney, the prime minister of Canada, recently put it, 'The United States is beginning to monetize its hegemony.' So what is an ally to do? Like the individual consumers who are trapped by Google Search or Facebook as the core product deteriorates, many are still learning just how hard it is to exit the network. And like the countless startups that have attempted to create an alternative to Twitter or Facebook over the years—most now forgotten, a few successful—other allies are now desperately scrambling to figure out how to build a network of their own. Infrastructure tends to be invisible until it starts being used against you. Back in 2020, the United States imposed sanctions on Hong Kong's chief executive, Carrie Lam, for repressing democracy protests on China's behalf. All at once, Lam became uniquely acquainted with the power of the dollar clearing system—a layer of the world's financial machinery that most people have never heard of. Here's how it works: Global banks convert currencies to and from US dollars so their customers can sell goods internationally. When a Japanese firm sells semiconductors to a tech company in Mexico, they'll likely conduct the transaction in dollars—because they want a universal currency that can quickly be used with other trading partners. So these firms may directly ask for payment in dollars, or else their banks may turn pesos into dollars and then use those dollars to buy yen, shuffling money through accounts in US-regulated banks like Citibank or J.P. Morgan, which 'clear' the transaction. So dollar clearing is an expedient. It's also the chief enforcement mechanism of US financial policy across the globe. If foreign banks don't implement US financial sanctions and other measures, they risk losing access to US dollar clearing and going under. This threat is so existentially dire that, when Lam was placed under US sanctions, even Chinese banks refused to have anything to do with her. She had to keep piles of cash scattered around her mansion to pay her bills. That maneuver against Lam was, at least on its face, about standing up for democracy. But in his second term, Trump has wasted no time in weaponizing the dollar clearing system against any target of his choosing. In February, for example, the administration imposed sanctions on the chief prosecutor of the International Criminal Court after he indicted Benjamin Netanyahu for alleged war crimes. Now, like Lam in Hong Kong, the official has become a financial and political pariah: Reportedly, his UK bank has frozen his accounts, and Microsoft has shut down his email address. Another platform that Trump is weaponizing? Weapons systems. Over the past couple of decades, a host of allies built and planned their air power around the F-35 stealth fighter jet, built by Lockheed Martin. In March, a rumor erupted online—in Reddit posts and X threads—that F-35s come with a 'kill switch' that would allow the US to shut them down at will. Sources tell us that there is no such kill switch on the F-35, per se. But the underlying anxiety is not unfounded. There is, as one former US defense official described it, a 'kill chain' that is 'essentially controlled by the United States.' Complex weapons platforms require constant maintenance and software updates, and they rely on real-time, proprietary intelligence streams for mapping and targeting. All that 'flows back through the United States,' the former official said, and can be blocked or turned off. Cases in point: When the UK wanted to allow Ukraine to use British missiles against Russia last November, it reportedly had to get US sign-off on the mapping data that allowed the missiles to hit their targets. Then, after Trump's disastrous Oval Office meeting with Volodymyr Zelensky in late February, the US temporarily cut off intelligence streams to Ukraine, including the encrypted GPS feeds that are integral to certain precision-guided missile systems. Such a shutoff would essentially brick a whole weapons platform. Communication systems are, if anything, even more vulnerable to enshittification. In a few short years, Elon Musk's Starlink satellites—which now make up about 65 percent of all active satellites in orbit—have become an indispensable source of internet access across the world. On the eve of Trump's second inaugural, Canada was planning to use Starlink to bring broadband to its vast rural hinterlands, Italy was eyeing it for secure diplomatic communications, and Ukraine had already become dependent on it for military operations. But as Musk joined the Trump administration's inner circle, a dependence on Starlink came to seem increasingly dangerous. In late February, the Trump administration reportedly threatened to withdraw Starlink access to Ukraine unless the country handed over rights to exploit its mineral reserves to the US. In a March confrontation on X, Musk boasted that Ukraine's 'entire front line would collapse' if he turned off Starlink. In response, Poland's foreign minister, Radek Sikorski, tried to stand up for an ally. He tweeted that Poland was paying for Ukraine's access to the service. Musk's reply? 'Be quiet, small man. You pay a tiny fraction of the cost. And there is no substitute for Starlink.' It isn't just big US defense contractors that might enforce the administration's line. European governments and banks often run on cloud computing provided by big US multinationals like Amazon and Microsoft, and leaders on the continent have begun to fear that Trump could choke off EU governments' access to their own databases. Microsoft's president, Brad Smith, has claimed this scenario is 'exceedingly unlikely' and has offered Europeans a 'binding commitment' that Microsoft will vigorously contest any efforts by the Trump administration to cut off cloud access, using 'all legal avenues available.' But Microsoft has failed to publicly explain its reported denial of email access to the International Criminal Court's chief prosecutor. And Smith's promise may not be enough to ward off Europeans' fears, to say nothing of the Trump administration's advances. The European Commission is now in advanced negotiations with a European provider to replace Microsoft's cloud services, and the Danish government is moving from Microsoft Office to an open source alternative. Of course, the American tech industry has famously cozied up to Trump this year, with CEOs attending his inauguration, changing content moderation policies, and rewriting editorial missions in ways that are friendlier to administration priorities. And as always, what Trump can't gain through loyalty, he'll extract through coercion. Either way, the traditional platform economy is being reshaped as commercial platforms and government institutions merge into a monstrous hybrid of business monopoly and state authority. Mark Zuckerberg, Jeff Bezos, Sundar Pichai, and Elon Musk attend Trump's inauguration on January 20, 2025. Photograph: JULIAIn the face of all these affronts to their sovereignty, a chorus of world leaders has woken from its daze and started to talk seriously about the once-unthinkable: breaking up with the United States. In February, the center-right German politician Friedrich Merz—upon learning that he'd won his country's federal election—declared on live TV that his priority as chancellor would be to 'achieve independence' from the US. 'I never thought I would have to say something like this on a television program,' he added. In March, French president Emmanuel Macron echoed that sentiment in a national address to his people: 'We must reinforce our independence,' he said. Later that month, Carney, the new Canadian prime minister, said that his country's old relationship with the US was 'over.' 'The West as we knew it no longer exists,' said Ursula von der Leyen, the head of the EU Commission, in April. 'Our next great unifying project must come from an independent Europe.' But the reality is that, for many allies, simply declaring independence isn't really a viable option. Japan and South Korea, which depend on the US to protect them against China, can do little more than pray that the bully in the White House leaves them alone. For now, Denmark and Canada are the other US allies most directly at risk from enshittification. Not only has Trump put Greenland (a protectorate of Denmark) and Canada at the top of his menu for territorial acquisition, but both countries have militaries that are unusually closely integrated into US structures. The 'transatlantic idea' has been the 'cornerstone of everything we do,' explains one technology adviser to the Danish government, who asked to remain anonymous due to the political sensitivity of the subject. Denmark spent years pushing back against arguments from other allies that Europe needed 'strategic autonomy.' And according to a former adviser on Canadian national security, the 'soft wiring' binding the US and Canadian military systems to each other makes them nearly impossible to disentangle. That explains why both countries have been slow to move away from US platforms. In March, the outspoken head of Denmark's parliamentary defense committee grabbed attention on X by declaring that his country's purchase of F-35s was a mistake: 'I can easily imagine a situation where the USA will demand Greenland from Denmark and will threaten to deactivate our weapons and let Russia attack us when we refuse,' he tweeted. But in reality, the Danish government is even now considering purchasing more F-35s. Canada, too, has already built its air-strike capacities on top of the F-35 platform; switching to another would, at best, require vast amounts of retooling and redundancy. 'We're going to look at alternatives, because we can't make ourselves vulnerable,' says the Canadian adviser. 'But we would then have a non-interoperable air force in our own country.' If allies keep building atop US platforms, they render themselves even more vulnerable to American coercion. But if they strike out on their own, they may pay a steeper, more immediate price. In March, the Canadian province of Ontario canceled its deal with Starlink to bring satellite internet to its poorer rural areas. Now, Canada will have to pay much more money to build physical internet connections or else wait for its own satellite constellations to come online. If other governments followed suit in other domains—breaking their deep interconnections with US weapons systems, or finding alternative cloud platforms for vital government and economic services—it would mean years of economic hardship. Everyone would be poorer. But that's exactly what some world leaders have been banding together to contemplate. US vice president JD Vance meets in Paris with Ursula von der Leyen, the president of the European Commission—who later said, 'The West as we knew it no longer exists.' Photograph:In Europe, discussions are coalescing around an ambitious idea called EuroStack, an EU-led 'digital supply chain' that would give Europe technological sovereignty independent from the US and other countries. The idea gathered steam a couple of months before Trump's reelection, when a group of business leaders, European politicians, and technologists—including Meredith Whittaker, the president of Signal, and Audrey Tang, Taiwan's former minister of digital affairs—met at the European Parliament to discuss 'European Digital Independence.' According to Cristina Caffarra, an economist who helped organize the meeting, the takeaway was stark: 'US tech giants own not only the services we engage with but also everything below, from chips to connectivity to cables under the sea to compute to cloud. If that infrastructure turns off, we have nowhere to go.' The feeling of urgency has only grown since Trump retook office. The German and French governments have embraced EuroStack, while major EU aircraft manufacturers and military suppliers like Airbus and Dassault have signed on to a public letter advocating its approach to 'sovereign digital infrastructure.' In all the European capitals, the Danish government adviser says, teams of people are calculating what elements should be folded into the effort and what it would cost. And EuroStack is just one part of the response to enshittification. The European Union is also putting together a joint defense fund to help EU countries buy weapons—but not from the US. The EU's executive agency, the European Commission, is patching together a network of satellites that could eventually provide Ukraine and Europe with their own home-baked alternative to Starlink. Christine Lagarde, the head of the European Central Bank, has also started talking pointedly about how Europe needs its own infrastructure for payments, credit, and debit, 'just in case.' Robin Berjon, a French computer scientist who spoke at the first EuroStack meeting, acknowledges that the project has yet 'to get proper financing and institutional backing' and is 'more a social movement than anything else.' If these projects succeed, they will be expensive and slow to bring online—and most will almost certainly underperform cutting-edge US equivalents. But Europe's issues with American platforms are no longer just about ads and cookies; they're about the very future of its democracies and national security. And in the longer term, the US itself faces a disquieting question. If it no longer provides platforms that the rest of the world wants to use, who will be left—and whose interests will be served—on American networks? After Doctorow's platform monopolists enshittified the user experience, they turned on the businesses that were their actual paying customers and started to abuse them too. US citizens are, ostensibly, the true customers of the US government. But as difficult and expensive as it will be for US allies to escape the enshittification of American power—it will be much harder for Americans to do so, as that power is increasingly turned against them. As WIRED has documented, the Trump administration has weaponized federal payments systems against disfavored domestic nonprofits, businesses, and even US states. Contractors such as Palantir are merging disparate federal databases, potentially creating radical new surveillance capabilities that can be exploited at the touch of a button. In time, US citizens may find themselves trapped in a diminished, nightmare America—like a post-Musk Twitter at scale—where everything works badly, everything can be turned against you, and everyone else has fled. De-enshittifying the platforms of American power isn't just an urgent priority for allies, then. It's an imperative for Americans too. Let us know what you think about this article. Submit a letter to the editor at mail@
Bloomberg
21-04-2025
- Business
- Bloomberg
How 12 Climate Tech Startups Are Shaping the Energy Transition in a Turbulent World
The winners of BloombergNEF's annual Pioneers awards are racing to deploy the next generation of climate solutions. By Illustrations by Petra Péterffy Ten years out from the Paris Agreement, the outlook for climate tech is decidedly unsettled. Funding for the energy transition crossed the $2 trillion threshold for the first time in 2024. Yet climate has tumbled down the international agenda this year. President Donald Trump has vowed to undo much of his predecessor's support for clean energy, while other countries have been distracted by his sweeping tariffs on imports and other issues such as national defense. In the fundraising community, venture capitalists are fleeing the sector for artificial intelligence. What can survive — and maybe even thrive — in this challenging environment? The winners of this year's BloombergNEF Pioneers awards for startups with potentially transformative carbon-cutting technology offer some clues. Investors chasing AI may eventually find themselves right back to funding the climate sector. A growing number of companies are using the technology to reduce climate harm and emissions rather than fueling them. The applications of machine learning run the gamut from high-tech beehives to improving the power grid. At the same time, one of the most under-invested corners of the climate tech universe is finally getting its due. Adapting to climate change received just 7.5% of all climate tech funding from 2019 to 2020. But with relentless fires, rising seas and deadly heat increasing, it's never been more important to prepare. Despite it being an underfunded sector, the startups working on reducing climate risk are quickly finding their services are needed. 'Climate adaptation companies are actually mature relative to everything else,' said Mark Daly, the head of technology and innovation at BNEF. Energy storage also stands a strong chance of continuing to find backers. The need for more and better batteries will rise in tandem with demand for renewables and electric vehicles — a dynamic that might be buffeted by geopolitics but remains very much in play. 'Lithium-ion is likely to continue to power the majority of EVs and at the premium, longer range,' said Andy Leach, an energy storage expert at BNEF, citing the most widespread battery technology. He noted that alternatives like sodium-ion batteries could be used in more affordable vehicles while more energy-dense, solid-state batteries make inroads in higher-end models. (Though some recent lithium-ion developments could challenge that.) Ultimately, some venture capitalists see the path to net zero as a marathon. And while Trump and the threat of a less cooperative world are real challenges, it doesn't mean the race stops. 'We've seen a lot of these cycles,' said Brook Porter, a founding partner at G2 Ventures. He said his firm's strategy, even before Trump, was to back companies that don't rely on subsidies, including those in the Inflation Reduction Act that lavished billions of dollars on clean technologies. 'Only 3% of our overall portfolio's revenue is exposed to IRA dollars,' he said. This year's Pioneers awards were given out to 12 startups from a group of 230 applicants that were reviewed by a group that included Bloomberg Green editors. The winners include companies working on reducing light industry emissions, improving energy storage and adapting to climate change — three key sustainability challenges identified by BNEF. Startups that didn't fit neatly in those categories were selected as wildcards. Industry emits about 25% of all the world's climate pollution. Heavy industry gets the lion's share of attention when it comes to decarbonization. Steel and cement alone are sources of carbon emissions on par with individual countries. Yet light-duty industry, which runs the gamut from textiles to food and beverage, is still responsible for a third of all industrial greenhouse gas emissions. Cutting those emissions means finding clean sources of heat, improving manufacturing efficiency and inventing entirely new means of production. Electrification is among the few bright spots in the climate investment world. The world spent nearly $730 billion on clean energy projects globally last year, according to BNEF. Grids also received a $390 billion infusion of cash. But the largest sector was electrified transportation, which saw $757 billion in investments. At nearly $1.9 trillion, those three categories account for the vast majority of the world's clean tech investing. Just as renewables costs have fallen, so too has storage. Lithium-ion battery packs are a quarter of the price they were 10 years ago. Lower prices and more mature technology have led to more deployments, a trend expected to continue, even in the US where Trump's tariffs are projected to drive up prices. By 2030, BNEF estimates the market will hit $254 billion and rise to $319 billion five years later. The battery world isn't just resting on the models and chemistries that exist today. It's also innovating to find novel forms and new materials that will help make energy storage even more ubiquitous and effective at propelling vehicles on carbon-free journeys. Investing in technologies that dampen the impacts of warming temperatures rather than cutting emissions has always been a relatively quiet corner of the climate VC ecosystem. But that may be shifting as the costly toll of climate change becomes clearer. Venture capital firms focused on specific sectors like wildfires and biodiversity — areas where adapting to climate impacts are key — have sprung up. And the urgency for adaptation solutions is growing, too. This year's Los Angeles fires are just the latest example of the world's lack of preparedness for the climate impacts of today, let alone the ones to come as the planet heats up further. The wildcard category is for climate tech solutions that don't fit neatly in a box. Interestingly, the winners in the section this year do fit roughly into one: industrial decarbonization. That was unintentional, BNEF's Daly said, adding that many of the winners wouldn't have necessarily won even a few years ago. 'People's understanding of the sector is deeper now, and some newer solutions have interesting business cases.' This year's wildcards' main focus is on heat. High heat well above 1,000C. So how do you generate such high temperatures with lower emissions? Do you even need heat at all? Or can you just use less of it? This year's crop of wildcards provide a few of the potential answers.
