From City Sewers to Sovereign AI with Russ Wilcox, CEO at ArtifexAI

Richie Cotton

Hi Russ, welcome to the show.

Russ Wilcox

Glad to be here. Thanks for having me.

Richie Cotton

Yeah. I want to start with the big one. So who's going to win the US China AI race?

Russ Wilcox

That's a really good question. And first off, I want to say that I firmly believe in American innovation. I think we got to where we are today due to the great researchers, the great institutional capitalism that allows us to really surpass the world, not just only in terms of artificial intelligence, but most technologies that we've developed. However, it is a deeper question than that because we are in a race with the East right now, specifically China.

Russ Wilcox

And it's true philosophical differences in regards to artificial intelligence. First off, here in the United States. We refer to AI as artificial intelligence. Meanwhile, the Chinese refer to it as intelligence period. So that tells you a lot about the philosophical nature approaching these technologies. In the United States, we have a bit of reticence, especially in terms of education, of how to apply it to our society.

Russ Wilcox

We worry about kids cheating. We worry about deepfakes. We worry about ethical situations that are very important. On the other side of the aisle, they've had AI education standards at least since if not going back to in terms how they use data and build a data driven society. So that kind of sets the backdrop of where we're at right now.

Russ Wilcox

Now who's winning? I would make the argument that in terms of innovation, America hands down America has shown that with our novel architectures, Transformers, we have new state based models coming out. We've shown that we have the ingenuity succeed. However, on the flip side of the coin, deep seat that came out great, but that only takes one part of the market.

Russ Wilcox

We have to look at a deeper strategy where China is winning is on the integration side within the United States. We look at fragmented data sets. We look at data silos, and we rely on companies to try to break down those silos, unify that data, inform a prediction on the other side. They already have that. They have what are called data reservoirs, where they have every single piece of available government data, public data being flown in into a single unified system that they call a unified compute architecture.

Russ Wilcox

Now, that allows for faster prediction or real time monitoring and smarter decision making at scale. So we have to remember, the AI race is not just about generative models like large language models like ChatGPT or anthropic, but it is also reliant on predictive machine learning models that are driven on data and how you unlock data. And so if you take a look at the integration of artificial intelligence at scale and the aggregation of data, China is winning hands out.

Russ Wilcox

If you look at the novel architectures and algorithms that are coming out of United States, America is winning. So the more detailed question is, what does the race look like in the next five years as America seeks to export its AI technology? Whereas China is applying it at scale not only nationally within their own borders, but also through what's called their digital silk Road or a more modern Belt and Road initiative.

Russ Wilcox

So what we have to be cognizant of during the AI race, it's not this monopole of who's winning, who's losing. It's rather a deeper understanding of what does artificial intelligence mean at scale? How does that inform decision making across geopolitical, geopolitical borders? And how is it adopted, adopted not just by companies, but governments, small and large, in individuals both within the border and outside the border?

Russ Wilcox

And I would have to say at this point, China is winning that race.

Richie Cotton

Interesting. Okay. So you're on the verge of different approaches and it does sound a lot like, I guess, recurring themes of like what happens when you have like a very much a free market economy, like, the US versus a more planned centralized economy like China. And so essentially you say in some sense the borders don't matter, and maybe it doesn't matter who wins the race.

Richie Cotton

Like it's always everyone benefits from the new technology. So, yeah, I guess, just talk me through, like, what happens with the rest of the world and, like, should anyone care about this race? Or is it just like a purely political thing?

Russ Wilcox

It's going to be geopolitical. There is going to be massive geopolitical ramifications. And in fact, one of the concerns coming out of China is this idea of an open hammer moment, like what happens when you have these systems that learn so well that can aggregate new sets of data at scale and democratize throughout the world? How does that disrupt geopolitical events, policies, etc.?

Russ Wilcox

So when we take a look at a foundational nationalistic strategy around AI, we have two competing models that have been competing for the last thousand year or maybe a thousand years, a little too much, at least since the enlightenment. We have this idea of a free market in democracy, which is going to win the race, period. We have sort of the question is who's winning the race right now?

Russ Wilcox

And I made the argument China's I don't think that's the case. I think America in the West will win in the long run. But we have some hurdles. Democracies are slow and we have this pesky concept, federalism in commercialism, which is very important for states rights for municipalities. But that creates data silos. And it's hard to create strong decisionmaking around critical infrastructure such as the grid, housing, energy, because you have layers of bureaucracy in jurisdiction that have been historically siloed.

Russ Wilcox

And the government can't just go in and say, I want all of Massachusetts's data. I know, I promise, I promise. It's going to be for good. It doesn't matter. You can't do that. It has to be a private company or a private entity that enables that. On the other side, you have the authoritarian model where it's data aggregation at scale.

Russ Wilcox

So one of the interesting positions that is coming out of the East right now is an extension of their Belt and Road Initiative, but I think a lot of the users are probably familiar with that concept, where China will go into a developing nation and say, we can help you. We can help you build infrastructure. We can help you build your ports and your bridges.

Russ Wilcox

We're going to be good friends. Yeah. If you read the loan terms, they're very non friendly. So there's there is this tension here at the infrastructure level. Now as you start to extend this you take a look at how does that play out in terms of artificial intelligence. Because China is also starting to scale its intelligence models and its intelligence infrastructure to developing countries that need this infrastructure, for example, Egypt, Indonesia, all of these areas are reliant on getting the technology they need to make modern, informed decisions, improve health care, improve agriculture, all of these things that we want in a good world.

Russ Wilcox

So as an extension of that, China is starting to expand that out. So they've taken their data model and now are looking at strategic areas for implementation of AI tech. Now you have to ask why would they do that. One, it's strategic from a soft power standpoint, but two what drives artificial intelligence data. So they are looking to extract new novel sets of data.

Russ Wilcox

The West currently doesn't have access to. And that presents a challenge around data sovereignty, AI sovereignty that we have to figure out. And I'm not saying that putting infrastructure in developing areas is something we shouldn't do. We have to be cognizant of that. For example, I believe there was a news story coming out of Denmark where the Danish wild bunch of busses and they found out that, you know, their purchase from China, there was actually tracking devices and pinged a Chinese server in Amsterdam.

Russ Wilcox

Right. You have to beg the question, right? And I'm not being adversarial because I believe that there is opportunity for collaboration to learn about how infrastructure is built, how we make these data distributed, data driven decisions, how you unify data sources. I am not a hot I am not saying we should separate these two. I'm saying we have to first fundamentally understand what the differences are between these races.

Russ Wilcox

So China is expanding out for a data aggregation standpoint so that they can have the most real time, up to date information. However, that's not historical data. It's a thin layer of modern data. But they're going to build up over time. So how does the West compete? The West is empowered by democratic principles, debate, diversification, historical records. Problem is that data is not easily accessible.

Russ Wilcox

It's locked in basements of city halls. It's an old PDF, pages of records that no one reads, but has an entire history or community, but also can contain structured data. So while China is winning the race right now, America in the West has the opportunity to innovate yet again. And supercharge this by unlocking massive amounts of historical data about what makes Boston different than Framingham, different from Chicago.

Russ Wilcox

In using that diversity of training data that has been transformed from unstructured information to structured information to win the race. So it's a little bit slower right now. And of course, we have economic tensions that are exacerbating these these challenges. But at the end of the day, those are the two fundamental differences between the AI race. And so you have to look at it as a more nuanced geopolitical perspective.

Russ Wilcox

Rather than who's going to get chips right? Chips are a big deal. That's important. But more importantly, what's going to happen to the underlying data infrastructure that's starting to scale and who controls that? That's going to be what's going to be interesting in the next couple of years to see.

Richie Cotton

Absolutely. And, so I did the, China's investing in lots of different countries is really interesting. I think as the biggest investor in, of infrastructure, throughout, throughout Africa. I'm pretty. Yeah. A lot of developing countries, like you say. So, I think before we go forward, I should probably say I've got to be neutral on this.

Richie Cotton

I'm a Brit. So, the useful between the U.S. and China, that seems, a sensible, take you mentioned the idea of sovereign AI here and data sovereign sovereignty. So, do you want to, talk me through, like, what are these concepts and who needs to care about them?

Russ Wilcox

That is a good question. And I want to say before we answer that, just to comment on your your comments about the middle man, I am no way trying to position an adversarial relationship from either side. I think that there are learnings that we can we can, we can deeply value from both sides. But that requires communication despite differences and this idea of finding common ground.

Russ Wilcox

And that will supercharge innovation. So the basic idea of sovereign are you can make it similar to the idea of a nation and the idea of nationalism. So I'm in Massachusetts, I'm in the United States. I have a set of laws that govern how I interact. I can't go and murder you. I can't go and steal your car.

Russ Wilcox

Right. All of these things that we all value and say, this is good, right? This is what makes us a functioning society. Sovereign AI, essentially, is the capacity of a given nation to be able to own and operate its own artificial intelligence systems, based on the ethics in the views of that nation in. This often has multi levels to this, not only of how you're building the AI systems.

Russ Wilcox

How are you building the data centers that drives them? Are you building them sustainably? Are you trying to build them sustainably? Who are you employing? Are you importing new technology? Are you developing your own technology? More importantly, what is this concept of data sovereignty as a nation? As I build more technical into a structure, as I start to piece new sets of information together.

Russ Wilcox

Who owns that? So a good example is, let's say the, I'm a nation, okay? And I'm not nations going to go nameless. And I really believe in helping agricultural outcomes in Egypt. Okay. So I'm going to export AI technology in that AI technology might be in the form of smart sensors. It might be in the form of dual use technology like drones to capture data.

Russ Wilcox

I'm going to build the pipelines to to help this country develop a more digital ecosystem to improve agricultural outcomes, all of which is good. We want that. Who owns that data? That data is highly valuable. Being able to predict crop yields. Being able to understand where when there might be droughts. Who owns that data? That is the concept of AI sovereignty, but at a base level.

Russ Wilcox

So who owns the data that drives this? Who owns the infrastructure? Who owns the technology? And it's not monolithic. There could be aspects where we want to import technology. For example, anthropic is one of the best large language models out there. There's not a competitor to that in the market right now. I'm sure all the people using GPT will say, oh, GPT five is good.

Russ Wilcox

No, no no, sorry. Cloud is on and out is the best coding assistant out there. I will stake my, my, my flag on that. No, I was not endorsed by anthropic data. But I'm just putting that into perspective. Right. So right now we have the kind of two model with with Google coming up with Gemini right here, these or models that are dominated the market, those are external API calls that a foreign country, an ally or an adversary has to send data and get data back.

Russ Wilcox

That's not an ideal outcome. So these the countries are now starting to evaluate how we build our own internal AI systems. And how do we build our own AI governance systems. How do we build our own data governance systems? And that's what sovereign AI it is. How does a nation have control over its digital infrastructure?

Richie Cotton

Okay, so it sounds like I mean, there's lots of different layers here. So you go, I guess, brought down from like, data centers and all the kind of the low level infrastructure right up through the, technology stack. And then, issues around, like, who owns the data, like the intellectual property around that. Okay. So, many, different areas, and I can certainly see how if you are a government, this is something you really need to care about.

Richie Cotton

Like, can my country support its own data and AI needs? If you're not a member of the government, is it something you need to be involved with or you need to worry about yourself %?

Russ Wilcox

So let's talk about data. That's the first thing, right? Because if I'm a if I'm a private company, I might be reliant on an AI model like in profit. Right. And I'm sending data back and forth. First question that I have is what happens if there are sanctions across and profit. Very unlikely. Very, very quickly. What do I do as my model go down?

Russ Wilcox

Does my business die? What happens if I am using deep sick? What if I found that the way that I'm using deep seek is not adversarial? I'm using you just structured data or something like that. But tariffs come in in sanctions come and say I can't use technology from another nation state. That presents a problem because not only are you impacting the company itself, imagine for your health care company and your services are interrupted to the constituent members of that health care community.

Russ Wilcox

So we're talking about AI models, but let's go back again to drive. What drives AI models? It's data. So what happens if there's a disruption with data centers? What happens if our grid goes down? What happens if there are geopolitical tensions? And I have a server in Norway, but Norway doesn't want to deal with US tech anymore, what happens to my data?

Russ Wilcox

What happens if I'm building a data center in a very interesting regulatory environment? I have data going back and forth, and that might be in a free, some sort of free trade zone. There's free trade zones popping up in a variety of areas, from indigenous areas, from isolated regions. Who owns it? Who's liable if I just decide to shut my data center down?

Russ Wilcox

These are the questions around AI sovereignty. You have to consider both as a government but also as an entrepreneur, because it's not just the data you're going to have to worry about. It can be the downstream regulatory effects are really concerned with what happens if your services are interrupted, what happens if compliance fails? And these are the questions that are still evolving that go into one of the questions that you asked a little bit earlier, which is what are the differences between America in China?

Russ Wilcox

But we forgot a big player, which is the EU. We know the EU had their AI act, and I am not a big fan of that because I, I firmly believe it inhibits innovation. I think they have good intentions. Just liked my Senator Markey's bill for AI has good intentions but good intentions. Public health. If you read the actual policies, you could interpret senators Markey's bill as requiring high school students to disclose the numbers they put in a linear regression because of traditional AI.

Russ Wilcox

So we don't need to have a common linguistic framework at a national level to understand this, let alone at an international level to understand disputes around this data. So sovereign AI comes in to the idea of a company saying, where are my risk points and how do I mitigate that? Why do I want do I want all of my eggs in one basket?

Russ Wilcox

Do I want everything stored on an Amazon U.S server that could be disrupted in a in a traditional data security sense? Right? But imagine that at scale with AI. And so this is going to be evolving as countries search develop their own models, as small language models become more ubiquitous as state based models that require less compute evolved and start to become parity with transformers, these are the questions we have to start answering now, because in to years, it's going to be some way we're going to have some sort of problem that we could have fixed if we thought about what does this mean to have some sort of sovereign control on information

Russ Wilcox

flow between my company, other companies and governance?

Richie Cotton

Okay. Well, so actually, I don't know about this, bill from center, market. You want to talk us through that? And then, I'd love to chat a bit more about the EU act and and the role.

Russ Wilcox

Yeah. So, you see, you see there is a, a variety of, I guess, getting out from a variety of legislations. You start to see the states becoming the playgrounds for this to start. And I'm going to, I'm going to set the stage before I answer your question directly. I mean, again, a lot of this requires context around the generalized understanding of artificial intelligence policy.

Russ Wilcox

So just like any type of policy, you can have a local policy at the states and a federal policy at the national level. Right now, the national AI space is equivalent to a Wild West. It's looking to create innovation and inhibit regulation. Right. And there's a trade off. There's a trade off between these two. And I'm not saying that we should have no regulation, but I'm also saying that we shouldn't have overbearing regulation such as GDPR right now as we're developing innovation technologies.

Russ Wilcox

But we also have the roles of states. So the states can come in. And we've seen this with the California Data Protection Act. We've seen this with the Texas Data Protection bill. Right. You are going if I'm a company operating in Texas and a company operating in California, I have two different frameworks of data governance that I have to deal with, and that already gives me a headache.

Russ Wilcox

Could you imagine having different state policies you have to deal around with AI, so that sets the stage. So now when you go to the federal level, you have to kind of keep coming out of the respective party, one to drive innovation. And I'm certainly don't want to get into politics here. And the other side, which is saying, hey, we recognize that there is this nature of artificial intelligence, do massive amounts of good, but also there's a substantive twist to this.

Russ Wilcox

So how to mitigate this? So in Senator Markey introduced what he called the AI civil rights bill. And its goal within its intent was admirable to eliminate AI, best to put guardrails on algorithms to help protect civil liberties, people's rights and liberties. Okay, the challenges the policymakers themselves and those individuals help. Policymakers are not technically sure. They don't have substantive understanding of deep technical architectures of where this bias comes from.

Russ Wilcox

So you might label something called traditional AI as a technician. What does that mean? What does that mean? K-means clustering model, because that could be considered machine learning to be traditional AI. Do you consider generative models like ChatGPT? Or again, you go to the farthest originalist interpretation of a policy and you say, well, what's the foundation of all of these models, which are probability and statistics?

Russ Wilcox

So if I'm a high school student doing a linear regression, and I would never say that this was actually going to happen, but based on my interpretation and reading of this, if I'm put a bill out requiring the modeling of traditional AI systems in their disclosing of their training data, there is a world where, as a high school teacher, I have to give data sets that I'm going to give my high school students to do linear regression to be audited in.

Russ Wilcox

As far fetched as that sounds, I'm not saying that was the intent or that would ever be applied. I'm saying there is sophisticated technical nuance that our legislators are not equipped to handle right now. And as we start to create inform, as we start to create policy, we're creating emotionally driven policy, which is never good. We want to create informed policy.

Russ Wilcox

And that's where I think there has to be a blend between think tanks, nonprofit enterprises, government to come together and understand what is a common language, what is a common framework we can talk about so that we don't run into problems two, three, five years long line because of vague interpretation of a policy that then has to go to the courts.

Russ Wilcox

That's how we move to try.

Richie Cotton

Okay. Yeah. So yeah, I can see how if high school students have got to, start auditing the work they're doing, it's like, well, that's kind of the job of the teachers, right? Whoever's grading no work, it doesn't need to go.

Russ Wilcox

Above to go in and say, okay, Mr. Cotton, what what data are you saying to get, you know, just again, being a physicist, I'm trained as a physicist. I always was learning to look at edge cases start. Right. How do you interpret and interpret those as you're kind of guardrails as you start to develop policy?

Richie Cotton

You mentioned at the start there are lots of fairly an ambiguous early great laws like data like don't Murder people is one that I think most people think is a good idea, but then at the other extreme, okay, with AI policies like you have something where everyone's going to have every single model they've ever created reviewed, that's completely unworkable.

Richie Cotton

So John talks to like, how do you get to having better policies around I like what's going to make this work.

Russ Wilcox

Yes. And it's going to be something that we don't like to do right now. It's going to be sitting down at a table and saying, Richie, I hate everything you say and everything you stand for, and you do the same thing for me, right? We live in a tribalistic political system right now. There's no kind of denying that fact.

Russ Wilcox

I don't want to turn this into a political discussion. Right. But we again, we have to observe the system. We're sitting. What it's going to take is when you talk to people coming together, and there are great folks on each side of the aisle doing some nominal work around AI regulation. Senator Todd Young, for example, is doing some great work to spur innovation while also understanding that this is a very complex adaptive system.

Russ Wilcox

To go back to your question, you have to bring people together and find common ground. And I'm not talking about regulations yet. Regulations should come out the there yet. I am saying first, can we agree that maybe using automated systems to kill people with drones is probably not a good idea? Maybe that's a good place to start, right?

Russ Wilcox

Again, not saying we're doing that now. I'm not saying that we should be doing that. I'm saying let's start with that conversation, okay? Let's first find these areas of ground. And then you go deeper and you start to say, okay, what are areas of societal risk that got to this? And one of the first things I think of is the criminal justice system.

Russ Wilcox

Do we live in a do we want to live in a world where sentencing.

Russ Wilcox

Based on a criminal act, is driven by a model? No. But does that mean that the final outcome can't be informed by some things on that that has been proven to be unbiased? No. So we have to think about, okay, what does a human and AI system look like together? Now the Chinese have a very interesting framework around that that they call human AI, human AI, which is human and AI form to be a blended model of humans, plus AI to improve decision making.

Russ Wilcox

That's where we want to start adopting, to realize that artificial intelligence should never be used to make final decisions, I will I will defend that to the death. I should always be used to inform someone to help make a better decision. So if we're talking about the criminal justice case, we say, okay, let's examine systems that can help make that decision making or fair, or just things that we all agree on.

Russ Wilcox

Okay, how do we do that? Well, we have this model okay. Where was that model trained? Because we know that there has been systematic biases in the criminal justice system. So is that model inherently biased? Did you try to balance your training data to mitigate those biases? Is it explainable. So I think where we start is a conversation of where are there high risk fields around this.

Russ Wilcox

Another good example is around what I call cognitive sovereignty. As AI becomes more and more developed, it becomes more sentient, like it starts to talk to you. It starts to inform you. You start to develop a certain relationship with it where you feel comfortable asking questions. Now, because we have had some horrible instances of suicides, there are safeguards that models start to put in there to say, okay, we shouldn't talk about this.

Russ Wilcox

And I agree with that. But where does that stop? Does that stop? If I'm a researcher doing deep research and on on the rise of fascism in the s, and I go to into a model and I start asking about Josef gerbils or things like that, how they did something. Right now that's an AI safety risk. And I think I agree from a certain context, but for another context, you're inhibiting someone's ability to do deeper research.

Russ Wilcox

So that's the next step. So you define first a framework where you say your absolutely areas where we should not be using artificial intelligence. It is too risky. The next layer is there is a higher risk tier of criminal justice policing. We of the big to maybe things to do with genetics. Then you go to a deeper layer and you say, well okay, health care is important, but we can still be a little less risk averse because doctors are overwhelmed.

Russ Wilcox

We need better decision making. Right? So we have those three layer that we have those layers. The onion start peeling back to start making informed policy that doesn't inhibit us, while also looking at other regulations that might inhibit artificial intelligence development. But simultaneously, we have to have a deeper discussion around what is the underlying cognitive architecture of these.

Russ Wilcox

And I'm not making the argument that we are at AGI or using AI is going to kill your brain. I mean, there have been studies out of MIT ChatGPT on your brain where it says, okay, whatever, % of your front frontal lobe or whatever, I'm not making I'm not getting the gist. Right? Right. But if you're using passive use of AI, you have a cognitive decline.

Russ Wilcox

But if you're using it in the right way, actively engaging with it, then you can use AI to be your superpower. So it's this duality that we haven't figured out. And as a society and as policymakers, we're not very good at dealing with duality. We want things black and white. We don't like things gray. Well, you can't get any grayer than the proliferation of artificial intelligence systems globally.

Russ Wilcox

So we need to bring the voices together that don't often talk with technicians in the room, with ethicists and philosophers in the room to really understand what is a framework that we can all agree on, but a framework that's not limited, because this goes back to the idea of sovereign AI. My American values are going to be different than your values in the UK, which are going to be different than my friends in Norway.

Russ Wilcox

Right? So we have to allow the flexibility for sovereign AI systems to adapt based on that culture. But we have to also have a common playing field of rules that we haven't started substantive discussions around yet. And then you're able to get at deep policy. That's my viewpoint on how we tackle this.

Richie Cotton

Okay, so I really love the idea of most different groups of people just figuring out what are the real issues here and having conversations and seeing where there is common ground, whether our disagreements seem as essential, as a first step in order to get to good policy. The one thing that struck me, though, is when you talk about the different, things that.

Richie Cotton

Okay. Yeah. Using drones. What about, automated kill people? Terrible idea. Should probably ban that. And then, you know, things like policing very high risk. I, I've heard this before. I feel like you've just reinvented the Aeaaeac risk classification system. It's very similar to that.

Russ Wilcox

So. Yes, but the the risk classification system within the Eacc, again, is built on good intentions, but it creates hurdles based on it's deeper language that stymies innovation. So we agree on the risk frameworks. I don't think anyone's doubting about that. And I am certainly not disparaging where I am on that. I'm now asking the question is what does that disclosure look like?

Russ Wilcox

For example, if I'm a startup and I have to disclose my training data for the world to see, I lose my competitive advantage. That's going to inhibit innovation even downstream. I might be doing something in the drone space to do something which I'm not. I'm not. So there has to be a deeper balance in large and more substantive frameworks around the disclosure training data, how these systems are audited, what are the ethical systems that you're dealing with?

Russ Wilcox

Right. Because even in a perfect world, if you're having these different risk systems, right, at the end of the day everything comes down to an embedding, right? How these models work is you take words and you put them into very long sets of numbers, and you do some sophisticated math, and then you try to predict the next, okay, from a threat standpoint, what happens if I just change one of those numbers where % of the time I'm right?

Russ Wilcox

And a good example, I might say, is you have a classifier to look for bombs in the TSA, okay? And it goes through this is not a bomb. This is not a bomb. It's not a bomb. But an agent gets in there and changes one of these little embeddings. And now Obama's out toothbrush. Right. And again, this is not a real life situation.

Russ Wilcox

I'm just trying to have uses illustrative fact that there are not strong quantitative mathematical frameworks on how these systems operate well enough to create a highly regulated disclosure of training data, because we don't understand the axiomatic principles mathematically of these models. There's a great guy out of, the UK, Anders Hansen, who was trying to actually create mathematical frameworks out of deep, deep neural networks and really try to understand explainability and those types of things.

Russ Wilcox

That's valuable. I don't necessarily agree with showcasing what the data was trained on, because that's a that's a defensive mode. I don't necessarily agree on how hard it might be to implement a risky AI system, because you need to test it, but you need to test it in the right ways. So you could have a wide field test for lack of a better word.

Russ Wilcox

So you have I'm a startup. I'm working in the education space. I'm worried about that. My AI system, which is high risk, it deals with children who are who are communicating back and forth what is going on, what data is aggregating all of this type of stuff. Right. I should have a set of frameworks, not necessarily divide by defined by the government, but defined by a system of who watches the watchers, what are the ethical outcomes, not just going into the regulatory outcomes.

Russ Wilcox

What are the ethical standards that go into this? That's where I'm getting at, and it's not getting at the heart of the deep implementations of risk factors, because we can agree with them. It's how they are applied, how are they audited, how are they implemented? And also regionally, you have to think about the EU is going to be very different societally from America.

Russ Wilcox

Our justice systems are very different. Our viewpoints on health care are vastly different. Right. So there's going to be different sets of regulations you want to go through. And the last thing we want to do is necessarily just borrow legislation from you and plop it into a state bill, which is what I've seen in some of these proposals.

Russ Wilcox

We have to take a more nuanced, personalized approach to how we actually develop those regulations.

Richie Cotton

Okay. All right. So, just to make sure I've understood this. So, perhaps going back to the, the school kids examples, you got some AI helping school kids chat about the homework, whatever. You can want some guardrails in there. I guess so. It's not like, swear your children or whatever, but.

Russ Wilcox

Let's actually go down this road I mentioned, right. One of the frameworks that has been developing within education in artificial intelligence is this idea of a Socratic truth. So this is the idea is it's a tutor where you can ask questions and they will ask a question back to you. It's not annoying to you had an undergrad that when you ask a question it would say, have you thought about it this way?

Russ Wilcox

Right. Why? Because it's there are studies shown that that promotes metacognition, or how we think about the way we think and improves learning outcomes. So what's happening is in the education chat you're having an at risk individual chat with a system. That data is going someplace else, right. Imagine what can be used by the data constructed from those chats can be used to infer learning disabilities at scale.

Russ Wilcox

Can it be if you have this system for education that follows this student throughout, say, grade three all the way through college, can you predict what they should go into for work? I'll look at it go. Can you have enough contextual information to understand the psychological profile of a student? And this is what I mean by the new, more nuanced applications of AI.

Russ Wilcox

Everyone's talking about like the training data. But every time you interact with an AI system, you're creating new data that can be transformed into structured data that can create risky situations. And those are the types of conversations that are being lost right now in the regulatory sense, because we're so focused on the deepfakes, on the at the high risk, on the copyright.

Russ Wilcox

And I'm not saying that that's not valid. I'm not saying that we shouldn't be cognizant of, but I'm saying that that should not dominate conversation because what happens when we're interacting enough with these chat bots where we can create a psychological profile, and that's where we get into some really challenging quandaries. And we don't have the frameworks to assess that.

Russ Wilcox

So that's where my drive is, is how do we have a deeper conversation on those principles to promote more intelligible regulations, rather than just thinking about, you know, at risk systems and bias around that? So sorry to interrupt your your question, but I thought it was a perfect kind of transition to give you a use case of this idea of cognitive sovereignty and the ability for AI to actually create new sets of structured data to build new models.

Russ Wilcox

On top of that, we don't even think of.

Richie Cotton

Yeah, absolutely. Yeah. I mean, it's a fascinating area. And certainly, in that sort of education setting where you deal with children so many things that go wrong, is it that information that feeds into like, yeah, your criminal justice system records? It's like, oh, well, yeah, we're going to give this person a longer sentence because when they were six, they said this and I like it.

Richie Cotton

Yeah.

Russ Wilcox

And and it goes into the data sovereignty. Right. So what happens is that data going on a server. What happens that server. Right. So all of this system is intertwined. It's a com what we call a complex adaptive system. You turn one little knob, you poke one little pot. Right. It has downstream effects that we can't predict right now.

Russ Wilcox

It's a chaotic dynamic system. And that's what we have to think about. Because exactly what you said. Right. What happens if we do create these unified data sets. There was a lot of good that could be come from it. Right? We could understand. Are there systematic gaps in in in education? We know there are, but we haven't quantified them.

Russ Wilcox

Are there opportunities for hyper personalized learning? I think everyone agrees. Yes. But what's happening at that data layer, what's happening at that infrastructure layer is what scares me.

Richie Cotton

Absolutely. I mean, so many, ethical, problems to think about, like many issues that need to be worked through and, and end up in legislation. Or I would like to take a step back, though, and, talk about how you got into thinking of us over now to begin with. And, I believe all starts with a broken city.

Russ Wilcox

Sewer infrastructure is a challenge in the United States. The way we build power plants, housing critical infrastructure such as sewers goes back to your local government. I'm sure everyone loves going to their local government. I'm sure it's the best experience that you look forward to every chance you get to stand in a long line and wait for a permit and not know what happens with this regulation.

Russ Wilcox

So started it was a few year. It was a year and a half after Covid, and I was, in in my city where, where I was living at the time and the city had a budget about, honestly, $million. Okay, most of that budget went to the school system. It also has a water quality problem. What that means is that the city didn't have a sewer system.

Russ Wilcox

It had what? Carl? What what? Our septic system. So what happens is when you go the bathroom, it goes into a tank. And the material, the biomaterial degrades into phosphates and nitrates that then leach out into the environment. Okay, now I know I'm getting fairly technical, but this is this is important. What happens is in that goes into the water stream as you build and build more, and it causes algae bloom when those algae blooms occur in then when they die, they give off what's called nitrous oxide, which is times more potent than a COthan CO

Russ Wilcox

So it's a climate impact. Secondly, it's a hyperlocal issue, meaning that the state government can't tell me what to do. I have control over my little town jurisdiction, and this is a problem that scales globally. That impacts global markets by $billion each year. So that's that's at the scale of the problem. The problem is, is this city wanted to put in a sewer system, that sewer system I think phase one cost a $million.

Russ Wilcox

Phase one on a town that has a budget of $million, where the vast majority of it goes, the school system. How do you deal with that? So I went to a local zoning board meeting, and I hear the presentation and I say, okay, I raise my hand to, how did you learn to understand that this is the most important part of the town?

Russ Wilcox

So we listened to a consultant, great. Where did the consultant get that data from? I said, can't you go through your permit history and see all of the areas where there might have been damage to the systems when they were built? Were there variances granted or exceptions granted because of one reason or another? And they said no.

Russ Wilcox

I said, well, why? They said all that's in paper. It would take way too long to figure that out. I didn't like that answer. So I called my college roommate. His name's Birdy. Said, Birdy, I have a great idea. What if we could create a system that changes the world from the ground up? Says. What do you mean?

Russ Wilcox

I say, what if we could create a system that actually could digitize and document? Digitization is nothing new. There are companies out there that will take you and put a PDF. I'm saying, what if we used AI at scale to extract structured data from these documents to map out where these problematic areas were? And then a weekend we did that and we showed a proof of concept saying that we could digitize all of this record.

Russ Wilcox

And I said, well, this is now very interesting because this only impacts the town I was living in. But they all share the same water supplies. But the town next door doesn't have information on this. So how are they talking to each other and where how's the state getting this information? And that's where I saw the opportunity. I said, what if we could create a system to build this sovereign data layer of public information for the United States for good so that everyone can have access to it?

Russ Wilcox

And that was apparently a good idea. I launched artifact as a Ted talk a year later. I was offered to give a talk on this at the World Economic Forum, and then that scaled my career where now I chair the policy committee for the American Society for Artificial Intelligence. I had the opportunity to to brief various departments, work with various members of Congress on AI.

Russ Wilcox

It all comes back down to that same problem that in order to compete with China, we need to drastically reevaluate how we operate in the United States to empower Democrats and principles. And that's where we come in. We use AI to digitize all of these records, connect them to understand what is the risk. If I were to put a sewer system here, or if I'm going to build a wind farm in Iowa, what regulations are going to hold me up?

Russ Wilcox

Why are they going to hold me up? How are they built in the first place? And you could see a world where this in a way, it kind of goes down to a area of, oh, there's a surveillance state here. Oh, of LA. And I'm not saying that that's not a risk. I am saying we take the strongest security and ethical safeguards around that, because we want to use AI to empower democracy.

Russ Wilcox

So one of our customers was dealing with is a city couldn't match their septic records with their building permits, with their zoning records. And you connect all of that, and now you're able to quickly identify compliance issues. We're able to create informed policy. You're able to report back to the state on this. And my dream is that America creates what we call a digital utility that creates structured information to drive infrastructure decisions, to drive policy decisions.

Russ Wilcox

And it all started because when I went to go swimming in my local pond during Covid, I couldn't because analogy.

Richie Cotton

I feel this was a good reason to try and save the world, just like I wanted it to go swimming. I couldn't because of an algae problem. Yeah. No, I loved it. I mean, because we think about, how all these, like, a large range model, they got all the data on the internet for everything, but all the stuff on paper, it's not there.

Richie Cotton

And I feel like there's so many bits of data that are locked away. So it's cool. Imagine to unlock it. So, I used to do, like, what need to do to build all this stuff. Is it just like a lot of, like, grabbing paper records and then just scanning them in like, well, what is it?

Russ Wilcox

Take a ball? There is. And I'm not going to give away my secret sauce. Of course. But there there's one fact that we have to get governments that historically have been underserved by technology services. I challenge you to go to your local assessor's website and just guess what year it was built. I'm guessing mine was in 

Russ Wilcox

It never changed. So there's technical debt here that's siloed. That's one aspect, right? There's technical debt that's siloed within a municipality. There is there are documents that you can scan and digitize. And we do do that, but not just to create the PDFs to create that structured data. And then you take a look at all of the different other sets of data that makes the city unique.

Russ Wilcox

You look at their town council meetings, you look at public comments, you look at old state databases that no one has touched. And then you say, okay, can I develop a system driven by machine learning to aggregate that answers, yes. And in fact, we can do this globally. We can understand development plotter patterns in China, in Tanzania, all across the globe because bureaucracy spans the borders.

Russ Wilcox

Now I'm not going to go into like turn this into an intelligence picture or anything like that. Right. But what I'm saying is that government data is siloed. So the first thing you have to do is you have to break down those silos and AI enables that. And then what you do is you categorize it and extract data out of that.

Russ Wilcox

And you can do that however you want, whatever flavors of models you want, we have our own. Then and then we connect it. We connect that using machine learning. So you know that Ross had a meeting with Richie, and it's the same Ross that in couldn't swim in his local pond because of an algal bloom. But you might hear that from a podcast, but you might see this from a zoning board meeting where Russ raised his hand complaining about this.

Russ Wilcox

That would historically not be seen. And then is where the fun part comes. Then you get the entire history. You look at deed records, you see where has there been red light? Why is things happen and you start creating this ecosystem of structured data that is explainable, that is self referential, able to create new novel, unified data sets, and then you can build predictive models.

Russ Wilcox

On top of that you can bring in geospatial data. You can bring in social media data. You know, it's heart in an ecosystem of connected knowledge that can empower to develop. So what it looks like is, yes, there are times where I've had to go pick up boxes and pass them through a scanner and validate that that is correct.

Russ Wilcox

But at the end of the day, you get novel sets of data. There are other times where we have what's called an omni scraper that can go out and scrape all of these different types of information and pick that up and link it together. Whether you're at a state, local, federal level, and then you silo it and you tear it down and you create a sovereign data layer of structured information that has competence in how you relate these documents.

Russ Wilcox

And then the fun comes of building models, and that's how cities should be built in the future.

Richie Cotton

It's very cool stuff. It reminds me a little bit of like, I guess the, the original goals from like, Google and Meta where it was like, we want know absolutely everything about you, but that was like to in order to sell you better adverts here, it's like we want to have, like, make better cities. So a much I guess I'm more a more noble goal there is like, let's go on the city level, like this is all the stuff that's happening.

Richie Cotton

This is how we make decisions better.

Russ Wilcox

Yeah. %. Because if you look at the smart city movement right now, I've been fundamentally opposed to this movement for the last five years and years is let's put in another sensor to measure traffic or air quality or this. And that's great and smart. Where does that data go? How does it reference the history of the town? How was it built?

Russ Wilcox

Why did we zone this one building this way? It's so funny I think one of my Co by my co-founder Bernie, I think went to a, a zoning board meeting or a planning board meeting when we first started in the city and they were debating why this one building was zoned this one way, because they wanted to convert it to like mixed use or something like that, and they couldn't figure it out.

Russ Wilcox

We went back to our system and we said, oh, well, because in this person did this, and this is why they did it. Right. And that's important to understand the context. Right? Or if you take a look at this at the federal side, large scale regulatory behaviors, you look at large scale acts of legislation. They are not new.

Russ Wilcox

You just a pet. You amend that right. Look at the Constitution, right. We don't create a new constitution. Historically, we added amendments. Sometimes those amendments aren't contradictory. In large scale policy documents coming out of Ferc or LIBOR or Nerf or any of these, agencies that require strong regulatory oversight, which I agree with. They are inconsistent with each other because humans are inconsistent.

Russ Wilcox

The person who sponsored this pers, this one piece of legislation didn't understand the full context because they couldn't read a page bill and understand why something happened, right? So that's what I'm saying. I enables democratic processes to function better. Another example of this is think about what's happening in local news. Back when I was a kid in the mid s, I could go to my newspaper and actually get a piece of unbiased news of saying what was going on in and growing, growing and going forward.

Russ Wilcox

You had Sinclair Media just starting to buy up local newspapers, and you don't have that level of reporting anymore. So you have information absence from your local populace. That's why voter turnout at the municipal level is so low. I'm talking about between and %. Is that democracy? No it's not. Why? It's not because people don't care. They don't have the time.

Russ Wilcox

They don't have the resources to go to these six hour long planning board meetings to get news from. But I can democratize that. I can enable that. Right. And it's this reframing from using AI as an efficiency tool from the corporate standpoint to an enabler in the public interest technology standpoint to improve how government functions.

Richie Cotton

That's a great dream. And I agree that, it is quite difficult to get local news like, I, in New York that some decent sort of cable news channels and all these local newspaper. And if you want to go digging for like, or what's going on, then. Yeah, it's tricky to find the information.

Russ Wilcox

And you'd be shocked what you thought you would be stopped. What you'd find is public record.

Richie Cotton

Okay. Yeah. Well, hopefully, I guess with your project, it's going to be a lot easier for people to do that sort of thing.

Russ Wilcox

Yes, that's the goal. That's the goal. Because again, what we're trying to do is we're trying to create transparency. And in this data, any model we build is always going to be transparent. We talked about my viewpoints on regulation and things like that. Right. They're explainable. Anytime you use AI in government you need that level of confidence. Right.

Russ Wilcox

And that level confidence starts at the data layer.

Richie Cotton

I want to pick up on one thing. He said, he said, quite often that a lot of the decisions go back to a bill. Something happened with a permit in It sounds like, to make this work, this has to be a project that works for decades. So how do you build for, long term like that?

Russ Wilcox

So that's a really good question. And you'd be surprised, though some of our customers who have wondered, you know, I'm building in Kalamazoo, Tennessee, right. That might have a population of people. Am I going to get data there? The answer is I've gotten better data from other Texas that had their records digitized going back to You could see when the first our phone poll was built astounded.

Russ Wilcox

And then you go to Waltham, Massachusetts, where you can barely get any public record. Right. So that's the first step is to realize is that there's not a correlation between population density and and transparency of. Right. And that tells you something about society. It's very interesting. But more importantly, this is one of the things that I'm talking with legislators at both the state and local and federal levels, is this idea of a data utility?

Russ Wilcox

God forbid someone thinks that I want some state owned enterprise light and track or something like that for AI and data. That's not what I'm saying. I'm saying we need to have a data layer that functions like the highway system for information flow. Why did we build the highways? Why did we get that infrastructure? We see more easily transport troops and supplies and supply chains right.

Russ Wilcox

Data is the new oil. Now you need a way to pipe it. And right now this is getting piped to corporations. I'm saying there has to be some frameworks and a national investment around a joint public private partnership model, or a data utility that allows folks, Ferc, which is one of the large scale electricity federal regulatory environments that allow the state Department of Public Utilities to access all of this data.

Russ Wilcox

Why? Because inside these documents are the histories of weight. Height changes, how the grid is developed. We know the grid needs massive monitor modernization, right. And people are talking about virtual power plants and all these great technologies, but it's missing the context of them. And so it's not just going to be the private side that dusts in this.

Russ Wilcox

There has to be a concerted effort on the public side as well to say that this is a critical infrastructure that can improve decision making.

Richie Cotton

Now, I love that. And I suppose, we've had similar discussions over the last few decades around like the internet, like, it went from, oh, this is a cool new technology to actually, this is a utility, something everyone needs. And so, yeah, it should be available to everyone at a reasonable price in order to help the rest of the economy.

Richie Cotton

I'm right there with you on. We should have the same thing for, a data layer as well.

Russ Wilcox

And I think there's a way of monetization. That's right. And I don't want to I want to take this, this, this conversation too far. But you take a look at one of the challenges around housing affordability, right? Is Texas towns make their money on taxes, mostly property taxes. So if you need more money, what happens? You either artificially inflate your property values or you you look at the market and say, well, my $house is now $

Russ Wilcox

So the secret more money. You're the town attorney. Or you do different funding modalities like two and a half overrides here in Massachusetts. Right. But modern, small and midtown American towns don't have the infrastructure to compete financially. That's why this town only has a budget of $million. I can't afford its sewer system, so it has to go to the state, has to go to the federal government or grant.

Russ Wilcox

What if there is a way to monetize its internal data? So now we have to think about data as an asset, right. So historically we go back to that first conversation where we say why do we have laws, right. If I killed you years ago, right. Your brother or your son or your child could come and kill me.

Russ Wilcox

And Hammurabi's Code would say, yes, it's done. But if I put a fence on your property, I couldn't kill you. That does not equal. So you had this concept of an arbiter, right? That said, okay, well, there's this set of common law that says, yeah, you're over the line. Here's what you have to do to mitigate that. But I'm not going to kill Rich, okay?

Russ Wilcox

And that's how our legal system developed over two, years around this concept of property as an asset. And we built our economy around that. And I'm not saying we shouldn't. I'm saying that data, which is a far more esoteric asset, a harder to comprehend asset in something that has come into the world maybe years ago at scale.

Russ Wilcox

We have to reframe the way we think about monetization and assets around this, because we can't just raise our property taxes for the next or years funding these projects. We have to find new ways of monetization and data and insights are the answers. And that's how you can have this public private partnership.

Richie Cotton

Okay. Yeah. It so seems like a useful thing to pursue hopefully over the next few decades. Maybe, if I maybe we can go ahead and say that we've got plenty of listeners here, particularly, I guess if you're in Waltham, Massachusetts, where apparently there's not good, public record systems, maybe you go speak to your local government representative.

Richie Cotton

Yeah. See if we can, get some things moving. All right. Wonderful. So, just to wrap up, I always want more people, to follow. Is there anyone whose work, you think, is worth, looking into in this area?

Russ Wilcox

Yes. I think there are a couple places you can take a look. One of the first locations I would take a look at is a great nonprofit out of the Boston area called Just Horizons. They are doing some work on ethical AI standards. They're run by, a world leading, ethicists and philosopher over technology. Wesley Wildman, they're doing some, some really great work on, on ethics in AI.

Russ Wilcox

So that is, I think, one of the first places to take a look. The second, is there is a group called Gaia X out of the EU that is doing a very similar type of thing of data sovereignty. Data that I'm trying to do here with artifacts. So I think that's a a good primer on what does it mean to be able to create these types of democratized AI systems.

Russ Wilcox

And then the third, which I'd highly recommend, it can be a little dense, is, the center for AI and Digital Policy. This allows for kind of a global academic network. Folks can come together, really debate and figure out these frameworks around AI security, AI ethics, etc. those are kind of the or external sources. I would take a look and then the last one is, a personal plug for me, which is if you're interested, actually learning more about my views on the AI China race, check out my Substack blog called The Pacific Divide.

Russ Wilcox

I take an unbiased look. I actually read and translate the actual documents from China, compare them to regulatory frameworks and those kind of the the tools that I would suggest. But I want to leave the listeners with one more thing is that we are in one of the greatest moments of human history, the only point in history that is similar that I've seen is the agricultural revolution.

Russ Wilcox

The agricultural revolution forced human society to change on how we work together. We evolved from hunters, gatherers say no. Now we need to have a set of communities for common good. I can do that. Right now we're developing these nationalistic AI systems, and we talked about sovereignty and all of that, which I agree with. But I can also find common ground between people and create modern collaborative frameworks.

Russ Wilcox

So if you're scared about AI, I don't blame you. There are risks around that. But I would challenge you to say, what can it enable and for you to test it. And when you test it, don't test it. Like Google. Don't ask it for information. Don't ask it to search for something. Play with an idea that you have.

Russ Wilcox

Play a game with the AI. Try to explore how to create a collaborative environment and I think you'll be surprised.

Richie Cotton

Okay, yeah, certainly I we lost the researcher and, I polled seven. There's so many surrounding things going in that area. But I love your point about. Well, yeah. Okay. I, I mean, I guess it can be divisive, but it also bring people together as well. So. Yeah. Let's hope we find some common ground in the future.

Richie Cotton

That's why it was like a good message.

Russ Wilcox

You look at the victory of humanity. We have these, like, little ups and downs and big bumps and downs. Right. But the general quality of living from someone from, from now to even years ago has drastically increased. Right? We're in this single social movement up and down, left and right. We're an upward trajectory. And I have hope.

Russ Wilcox

And I believe in humanity. I believe in democratic principles, and I believe in collaboration. And AI is going to enable that might not be five years from now. It might be ten, might be years from now. But I was going to be central on that. And don't lose hope on that. And don't forget your humanity.

Richie Cotton

Wonderful. All right. Great. Let's, thank you so much for your time, Russ.

Russ Wilcox

Perfect. Thank you so much for having me.