7 New Insights From 2025 at Bismarck Brief
In 2025, our analysts wrote nearly a quarter of a million words on new technologies, global industry, and live players. Here are 7 key insights from our work this year.
The depth and breadth of our long-form investigations at Bismarck Brief give rise to many new insights, observations, and models of economics and politics that do not fit neatly into any specific Brief, but are valuable and important to consider nonetheless. Every year, we have collected some of our favorite new insights from the year and published them for our readers—the full list of our 27 previous insights from 2021 to 2024 is available to read here. This year, the tradition will continue. On the cusp of the new year, here are our seven top insights from 2025:
#1 - The prime input for AI progress is elite math and computer talent. The so-called “scaling hypothesis,” that all that is needed to make concrete further progress in artificial intelligence technology is more data and more computing power, has become default consensus in Silicon Valley since the November 2022 release of ChatGPT. But although this theory of further advancement has spurred an unprecedented wave of investment and optimism about AI, it notably neglects the foundational input that necessarily must come before any other: individuals with elite talents in mathematics, computer science, and even software development, often drawn from the halls of academia.
Overlooking this basic fact is arguably what caused U.S. observers to drastically underestimate China’s potential for catch-up AI progress until the debut of DeepSeek in early 2025. Multiple Chinese AI labs drawing on China’s vast domestic reserve of mathematical and computer talent have since made global splashes of their own, such as Alibaba’s Qwen lab, Z.ai, or Moonshot AI. France’s Mistral has drawn on European talent in the same way, nor should it ever be forgotten that it was by leveraging academic computer science talent from North America, through top researchers like Ilya Sutskever, that companies like Google and OpenAI made their early great leaps in the first place.
#2 - Luxury goods are not intrinsically valuable, but instead social technologies designed by live players to generate money and prestige ex nihilo. It is deeply ingrained in our collective subconsciousness that items ranging from glittering gems to fine leather apparel are of a value so great they should not even be second-guessed, let alone haggled over. Yet whatever truly intrinsic value such goods may have, the bulk of profits made and status ascribed thanks to them never comes from this intrinsic value, but the intangible social and signalling value added on top. Such value appears to us also intrinsic, but is actually socially engineered by live players through elaborate marketing, diligently maintained rituals, and often counterintuitively exclusionary practices.
Whether one looks at the deliberately onerous shopping experience employed by Hermès against its own customers, the globe-spanning De Beers monopoly that until recently inflated the perceived value of diamonds, or the hallowed branding of the empire of Bernard Arnault’s LVMH, the notable fact is that such luxury goods are not fundamentally based in technical or logistical realities so much as the skillful manipulation of imaginations. It is this basic unreality of luxury that makes its producers catastrophically vulnerable to fickle changes in taste. But the takeaway for a live player is not that luxury goods are a capricious and risky arena to be avoided, rather that in this arena great wealth and influence can be generated almost purely through charisma rather than brutal political or economic competition.
#3 - A large enough organization is an empire that can contain hidden live players or multiple traditions of knowledge. We are perhaps accustomed to thinking of institutions as the secondary outputs of prolific captains of industry, or mere shells around a generative tradition of knowledge. But an organization with enough personnel, resources, and other owned power, that is sufficiently hard to steer or prune, can also function as an environment within which multiple key players and factions compete for power or quietly bend arms of the organization toward their own external goals.
It is a notable fact that, for example, the most influential person at Microsoft secretly remains Bill Gates, and the most influential person at Amazon remains Jeff Bezos, despite neither men holding majority voting power through shareholdings or the formal chief executiveship at their respective companies. Despite both being perceived as partially or fully retired, they are able to broker significant deals or effect pivotal changes in strategy behind the scenes that evidently no other person can, through mechanisms that are essentially personal and invisible. It was Gates who ultimately greenlit a fateful partnership with OpenAI and brought another live player in Sam Altman into the orbit of Microsoft. Bezos’ nominally independent space company Blue Origin builds rockets that will carry Amazon internet satellites—and perhaps AWS orbital data centers—into space.
At Google, meanwhile, the resources of the world’s most profitable company have not been deployed on a narrow and focused mission but doled out to multiple independent technical traditions of knowledge such as Waymo, Google Brain, and Demis Hassabis’ DeepMind, under the often distant watch of both the company’s two idiosyncratic founders Sergey Brin and Larry Page, as well as the much closer watch of highly effective but very different lieutenants like Eric Schmidt and Sundar Pichai. An organization is sometimes a dead player overall even as its constituent parts may be piloted or merely mined for resources by live players; multiple such organizations now count among the world’s most profitable companies.
#4 - Developed democracies can and will rapidly economically decline if they remain dead players. The very term “developed” is misleading, since it implies that there is an end to economic, technological, and industrial development. Yet the finality of this term, among other similar narrative devices, has lulled us into a false sense of security with regards to the robustness of the wealth, prestige, and public order of the world’s industrialized liberal democracies. Rather than being a static and irreversible state achieved at the end of history, we have seen that developed democracies can take lasting economic damage even in peacetime.
A country like Greece stands as an extreme but early and telling example, having used every tactic including outright fraud to escalate social transfers way beyond fiscal sustainability until a so far permanent relative impoverishment became inevitable. Even much larger countries like Italy and Spain, despite far more industrial virtues and far higher baselines, are slowly yielding their productive sectors to foreign competition and domestic rent-seeking in the absence of decisive leadership. Japan, within living memory the world’s second-largest and most dynamic economy, succumbed to stagnation after succession failure in the commanding heights of its economy. These economies are in the same reference class as those of the United States and Western Europe. Live player leadership is not optional to avoid decline. Greece was perhaps a canary in the coal mine for the rest of us, not an exceptional case from the periphery.
#5 - The militarization of space is beginning and will reshape the global balance of power. After the initial spurt of progress in rocketry and satellite technology caused by the Cold War-era Space Race in the 1950s and 1960s, space technology became the dominion of sluggish defense and aerospace contractors like Lockheed Martin, Boeing, France’s ArianeSpace, and later the Russian successors of the Soviet “design bureaus.” But since the creation of reusable space rockets and the resulting revolutionary decreases in the cost of carrying mass to space pioneered by Elon Musk’s SpaceX, a whole new universe of possibilities for space capabilities has opened up—not just commercial, but military too.
China, foremost, cannot allow the U.S. to develop an uncontested advantage in military capabilities in space. This already is and will further drive Chinese ambitions to match and surpass SpaceX. But neither can lesser industrial and military powers including Russia, India, Japan, and others rest on their laurels. Whether a middle power is able to spin up a serviceable rocket and satellite program to match the state of the art may well become a key determiner of middle power status at all in the relatively near future, in the same way that today a key determiner of this status is whether a power can run an effective air force.
#6 - Progressive philanthropy and activism is increasingly shaped by none other than tech billionaires. Although prominent voices in software and venture capital have taken a political turn conciliatory to or even vocally supportive of President Donald Trump and the Republican Party since 2024, a perhaps equally prominent and influential contingent of key players in Silicon Valley have become, and remain, new nodes tying tech wealth to the Democratic Party and wider progressive activist movement.
Steve Jobs’ widow Laurene Powell Jobs is a major financial patron of progressive prestige media and a personal confidante of former Democratic presidential candidate Kamala Harris. When Elon Musk acquired Twitter in a bid to loosen censorship and speech restrictions, it was the fortune of eBay founder Pierre Omidyar that financed his most vociferous opponents, who ran a successful campaign to get advertisers to drop the company. Peter Thiel’s perhaps former close friend and LinkedIn cofounder Reid Hoffman has made it a personal mission to oppose Trump even as he plays a notable behind-the-scenes role in AI. Despite the outsized popularity and visibility of some stalwart contrarians, Silicon Valley’s politics were until recently monolithic, and the era of a truly bipartisan tech scene is still brand new and fragile. Nor is the U.S. likely, anymore, to see a political future free of the touch of tech wealth.
#7 - Judges and bureaucrats are resilient to populist groundswells. The tug-of-war for electoral and cultural primacy between credentialed elites and populist coalitions enabled by the internet has now been ongoing for a decade in North America and Europe. There have been victories by both sides, even lasting populist victories in countries such as Hungary. While this conflict remains live and unresolved, it is notable that it has clear parallels well outside of the economic and cultural environment of the developed world.
In India, for example, a winning populist middle-class coalition led by Narendra Modi and with the backing of the country’s wealthiest businessmen like Mukesh Ambani has so far failed to dislodge a sclerotic civil service or overpowered supreme court. This suggests that institutional factors are as crucial to consider as cultural, demographic, or economic ones in this ongoing struggle. One of the most dramatic governance turnarounds of the decade, that of President Nayib Bukele in El Salvador, began not as a populist revolt but an arm’s-length alliance with established but lethargic and morally discredited parties. What lessons do these examples and others hold for us?
If you haven’t already, you can read the full list of our 27 previous insights from 2021 to 2024 here.
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Happy New Year!
Samo Burja
Founder and President, Bismarck Analysis