A Big Shift in the AI Race

**Nathaniel Whittemore** (0:00)
Today on the AI Daily Brief, some big shifts in the AI race.
Before that in the headlines, the latest on Anthropics Fight with Washington. The AI Daily Brief is a daily podcast and video about the most important news and discussions in AI.
All right, friends, we are back with a normal episode today. Appreciate your forbearance yesterday as we got to go make some core memories at the World Cup. And of course, the big story happening behind the scenes in AI continues to be the fallout of the Fable 5 shutdown and the negotiations to try to bring it back. It has at this point been five days since the US government shut down Mythos slash Fable, or rather, imposed the conditions upon Anthropic where they were forced to shut down Mythos slash Fable, and it doesn't particularly appear like we're any closer to a resolution. On Monday, Anthropic leaders touched down in Washington to explain the situation and to try to come to some new type of understanding. Now, interestingly, and I think giving some insight into how Anthropic is viewing this situation, rightly or wrongly, is that the talks appear to have been largely technical. Anthropic sent Chief Compute Officer Tom Brown, Head of External Affairs Sarah Heck, Head of Red Teaming Logan Graham, and Senior Security Researcher Nicholas Carlini. The Wall Street Journal actually ran quite a long piece about Carlini, titled The Hacker Sent by Anthropic to Calm the Government's Nerves About AI Safety. The Journal describes him as a well-respected hacker who is considered something of a professional skeptic of AI cybersecurity claims, who has, quote, lately changed his mind. Putting some fuel on the fire of no, this time was actually different, they write, just weeks after getting his hands on Mythos, Carlini offered a stark warning to a standing room-only crowd of cybersecurity experts. First, he showed them how he had used Anthropic's AI to find and exploit a critical bug in a piece of web-publishing software called Ghost. Then he demonstrated another in the Linux operating system, one of the most battle-tested pieces of software, which powers billions of devices. Carlini had never before found a bug in Linux or in Ghost. Now, he had discovered many. What he was seeing represented a new world order for cybersecurity. The balance that existed between attackers and defenders over the past two decades, quote, seems like it's probably coming to an end. He continued, it's pretty clear to me that these current models are better vulnerability researchers than I am. Now, that was back in March. And it sounds like Carlinni was one of the folks inside of Anthropic, pushing the company not to release Mythos at that time. Fast forward to the situation we have today, former DoD official and Council on Foreign Relations senior fellow Michael Horowitz said, The government and Anthropic clearly have an inability to communicate effectively with each other. More technical exchanges should be helpful in socializing these issues in a way that should lead to better decisions.
So coming back to the negotiations on the government side, staff from the Center for AI Standards and Innovation in the office of the National Cyber Director also attended the meetings.
Commerce Secretary Howard Lutnick phoned in from the G7 Summit in France. However, it appears that none of the key architects of the decision, including National Cyber Director Sean Cairncross, Treasury Secretary Scott Besson, or White House Chief of Staff Susie Wiles, were in attendance. Given the prior reporting then, it's questionable whether anyone in the room on Monday had authority to actually call off this Mythos-Fable ban. One thing that is worth underscoring at this point, obviously since so much of the coverage, mine included, has focused on Fable because gosh darn it, you took our new toy away. This is absolutely not just a Fable 5 ban, it is very much a Mythos ban as well. In fact, it seems like the re-release of Fable to consumers is fairly low on the list of the government's concerns. Sources said the Commerce Department expressed a willingness to allow Fable to come back online as long as Anthropic fixed the jailbreak that was at the heart of the matter in the first place.
Mythos, it seems, is another question. Over the weekend, we had some very thin reporting from Semaphore that the administration feared the Chinese government had gained access to Mythos. And on Tuesday, The Washington Post reported that a big part of the schism with Anthropic had come up out from the expanded access to Mythos a few weeks earlier.
The WP wrote that Anthropic added around 50 firms to Project Glasswing at that time. And it was then that, quote, senior officials began to consider using export controls to claw back the technology after Anthropic did not identify the new recipients for days. Once the government had the list, they discovered that one recipient was a South Korean telecom company that the administration suspects of having ties to the Chinese government. Now the nature of the jailbreak is also getting increased attention in the press. On Tuesday, The Atlantic elevated the analysis of LADA security CEO, Katie Moussouris, which I discussed in earlier coverage. They rehashed the point that Fable will refuse to review insecure code for security issues, but when asked to fix the bugs, it will generate patches. Moussouris' point has been that this was just the model working as intended for cyber defense, arguing that GPT-55 and Opus 48 work in the same way. And yet, of course, as we've seen over and over, part of the meta story is about personal interactions between the major players rather than technical specifics. In Monday reporting, an administration official told Axios that Anthropic knew the model was susceptible to a jailbreak and decided to distribute it anyway. They came to every fork in the road, the source said, and took the wrong fork. A source familiar with the administration's thinking commented, Anthropic has not done a great job at trying to speak to the administration and appreciate the ideological differences. It's like they just speak in different languages.