Slow Takes Ep. 2: Replaced, Monitored, or Deregulated

Thank you Karo (Product with Attitude), Jessica Drapluk, Jen Benford, @colleenkenny, Des Kennedy, Karen Brasch 🚁, and many others for tuning into this episode. This is the second episode of Slow Takes, a weekly Substack Live I co-host with Leor from Exploring ChatGPT. The format is simple: we take the week’s AI news and react to it without hype, without predictions, and without pretending we have all the answers. We invite the audience to call us out when we get it wrong.You can also watch us on Youtube here. What follows is not a summary. It is context that did not fit into 47 minutes, plus the sources so you can read further and form your own view.What we covered1. Anthropic versus the PentagonThe Pentagon demanded unrestricted access to Claude. Anthropic held two red lines: no mass domestic surveillance of Americans, no fully autonomous weapons. Pete Hegseth gave them a Friday deadline. Anthropic refused. Trump blacklisted them via Truth Social. The contract went to OpenAI.What we said on the live: This is not a story about good versus evil. Anthropic contracted with Palantir, accepted a $200 million defence contract, and was involved in the capture of a foreign head of state. OpenAI released a statement pledging the same two red lines Anthropic was punished for holding. We do not believe a word of it. Watch what companies do, not what they say. And if the US government pushes Anthropic out, other countries will be waiting.What did not come up: On 1 March, OpenAI published further details of its Pentagon agreement. It retains full discretion over its safety stack, deploys via cloud rather than handing over model weights, requires cleared OpenAI personnel in the loop, and has contractual protections. More notably, OpenAI explicitly asked the Pentagon to extend the same safety terms to all AI labs, including Anthropic. Whether that is genuine or positioning remains to be seen.As of 2 March, Dario Amodei has escalated his language, calling the supply chain risk designation ‘retaliatory and punitive.’ This is stronger than the earlier ‘unprecedented’ and ‘legally unsound’ framing. Anthropic says it received no direct communication from the Department of Defense or the White House before the designation was made public.The Pentagon’s position was that Anthropic’s red lines were unnecessary because mass surveillance is already illegal and internal policies already restrict autonomous weapons. Anthropic’s counterargument: policies can be changed; contractual red lines cannot.I wrote about this at length in Nobody Blinked. Now What?Source: OpenAI statement | Source: Anthropic statement2. Jack Dorsey cuts 40% of BlockJack Dorsey fired 4,000 of Block’s 10,205 employees. Not because the company was in crisis. Revenue of $6.25 billion slightly beat estimates. Dorsey said he was replacing them with AI tools ‘in advance of what we think is going to happen.’ Block’s stock rose 24%.What we said on the live: This is a long-term risk for a short-term reward. Leor’s experience, and the research backs this up: the more you work with AI, the busier you get. If you are not training juniors now, you will not have seniors in ten years. Dorsey doubled Block’s workforce between 2022 and 2024. Even Altman said companies are using AI as an excuse to lay people off. Medium term is one quarter now, not five years.What did not come up: Bloomberg ran a piece on 1 March headlined ‘Jack Dorsey’s 4,000 Job Cuts Arouse Suspicions of AI-Washing.’ The Oxford Economics report from January 2026 found many layoffs attributed to AI were actually correcting pandemic overhiring. Ben May (Oxford Economics): ‘We suspect some firms are trying to dress up layoffs as a good news story rather than a bad one.’The numbers tell the overhiring story clearly. Block had 3,835 employees in 2019. It peaked above 10,000 by end of 2025. After the cuts it will have around 6,000. That is still 56% larger than pre-pandemic. Dorsey’s claim that 2024 corrections already dealt with overhiring does not hold up.Dorsey published his rationale as a 626-word post on X: ‘Intelligence tools have changed what it means to build and run a company. A significantly smaller team, using the tools we’re building, can do more and do it better.’ He also predicted that within a year, most companies will reach the same conclusion. That prediction is doing the heavy lifting for the stock price.Source: CNBC | Source: Bloomberg3. Surveillance with a smile: Burger King’s AI headsetsBurger King is testing OpenAI-powered headsets at 500 US restaurants. The system, called ‘Patty,’ listens through existing employee headsets for welcomes, pleases, and thank yous, and scores the friendliness of drive-through workers.What we said on the live: Super creepy. This should be flipped: humans surveilling AI, not AI surveilling humans. Happiness and pleasantries are subjective. What about neurodivergent employees? What about people having a bad day? This technology forces compliance to a very specific, heterogeneous, neurotypical standard. It made us think of Office Space (the flair scene) and Stepford Wives. If OpenAI are against mass surveillance, this contradicts that claim.What did not come up: Burger King insists this is ‘a coaching tool,’ not a scoring system. Patty also alerts managers when items run out and helps workers remember ingredients for limited-time offers. The friendliness monitoring is the headline, but the broader system is a full operational AI assistant embedded in the headset.Whether employees can opt out, and whether the audio data is stored or used for training, has not been clearly answered. The name ‘Patty’ is doing a lot of work. Naming a surveillance AI after a burger patty is an attempt to make workplace monitoring feel playful and non-threatening.Source: Fortune | Source: NBC News4. Grok, Aurora, and three million deepfakesGrok launched an image generation tool called Aurora that enables users to de-clothe people, including children. The EU opened a formal investigation. French police raided X’s Paris office. The UK’s ICO and Ofcom launched investigations. Indonesia and Malaysia blocked Grok. Elon Musk’s response was that nobody committed suicide because of Grok.What we said on the live: This does not require a lot of critical thinking. Nobody wants this. There is no need for any AI tool that enables childhood exploitation or sexualised deepfakes. The technology to prevent it exists. The legislation should exist. Musk has no positionality. He comes at this from privilege without putting himself in the position of the marginalised and the traumatised. This was likely a purposeful marketing choice: a not-zero percentage of people want this content, and multi-billion pound industries already profit from it.What did not come up: At peak, Aurora was producing as many as 6,700 sexualised images per hour. That figure quantifies the scale in a way that abstract discussion of deepfakes does not.Musk and former X CEO Linda Yaccarino have been personally summoned to testify in French hearings in April. The Paris raid was part of a year-long investigation that predates the Aurora feature. And under the UK’s Online Safety Act, Ofcom can seek a court order to block access to X entirely, not just fine it.X’s response was to restrict image generation to paid subscribers only. This does not solve the problem. It paywalls it.xAI actively marketed a ‘spicy mode’ as a feature differentiator. The deepfakes were not an unintended edge case. They were a predictable consequence of a design choice.Source: PBS | Source: Al Jazeera5. Trump’s AI Litigation Task Force: suing states that regulateTrump created the AI Litigation Task Force through an executive order. The DOJ will sue states that pass AI regulation. The leverage: $42 billion in BEAD (Broadband Equity Access and Deployment) funding. States with AI laws the federal government deems too restrictive become ineligible for broadband infrastructure money.What we said on the live: States should be able to make their own decisions. That is how the US operates. But even if they do, companies can just leave that state. Legislation cannot keep up with the pace of technology. We need both top-down regulation and bottom-up critical AI literacy. We cannot rely on either alone.What did not come up: This executive order was signed on 11 December 2025, not the past week. The AI Litigation Task Force has been operational since 10 January 2026, led by AG Pam Bondi. What brought it back into the news cycle was a 26 February analysis in The Regulatory Review.The BEAD leverage is legally dubious. Lawfare’s analysis argues it faces ‘steep legal hurdles.’ Under NFIB v. Sebelius (2012), the Supreme Court ruled that the federal government cannot coerce states by threatening to withhold large amounts of pre-existing funding. Using $42 billion in broadband money to force AI deregulation may cross that line.The irony is hard to miss. BEAD stands for Broadband Equity, Access and Deployment. Using equity-oriented infrastructure funding as a cudgel against AI consumer protections is a tension that deserves more attention.Multiple legal mechanisms are working in parallel: DOJ litigation, FCC proceedings, FTC policy statements, and conditions on discretionary grants. The strategy is to create overlapping federal authority that makes state AI regulation practically impossible. Colorado and California have both signalled legal challenges.Source: The Regulatory Review | Source: LawfareThis week’s Substacker recommendationsSam recommends: Chief Absurdist Officer and their series Not Rising, which platforms writers outside the Substack algorithm’s favourites. This week’s feature is Jennifer Houle at Uncompliant. Jennifer writes about HR in a way that is insightful, funny, and incredibly dark. She is also joining me for a Slow AI live later this week.Leor recommends: Daniel Nest. He just likes to have fun with AI. Sometimes the best way to build with these tools is to nerd out and enjoy it.Slow Takes is every Monday1pm GMT. 8am Eastern.One week in AI. No hype.Go slow. Get full access to Slow AI at theslowai.substack.com/subscribe