The pace of big funding rounds continued to hold up at brisk levels this past week, led by a $1.4 billion financing for 'robot brain' developer Skild AI. More big rounds went to startups in sectors including AI chips, brain-computer interfaces, defense tech, biotech and airplanes, among others. 1. Skild AI, $1.4B, robotics: Skild AI, a robotics company building an 'omni-bodied' brain to operate any robot for any task, announced it raised $1.4 billion, tripling its valuation to over $14 billion. SoftBank Group led the Pittsburgh-based startup's latest financing, which comes just over seven months after it raised a Series B at a $4.5 billion valuation. 2. Etched.ai, $500M, AI and semiconductors: Etched.ai, a startup working on chips for AI superintelligence, reportedly secured $500 million in new funding. Stripes led the financing, which was said to set a $5 billion valuation for the Silicon Valley-based company. 3. Merge Labs, $252M, brain-computer interfaces: Merge Labs, a Sam Altman-founded startup based in San Francisco, which is working on brain-computer interfaces that interact with the brain at high bandwidth and integrate with advanced AI, reportedly locked up a $252 million seed round. According to reports, OpenAI was the largest backer....

Defense tech startup Onebrief has raised another $200 million and acquired a small battle simulation company, Axios reported. The deals follow on the heels of a record-setting year for venture investment into defense tech startups, per Crunchbase data. Battery Ventures and Sapphire Ventures led the Series D funding for Honolulu-based Onebrief. Investors including Salesforce Ventures 1, General Catalyst and Insight Partners joined. An updated valuation was not reported, but the company raised its Series C just seven months ago at a $1.1 billion pre-money valuation, per Crunchbase. Onebrief has now raised $311 million in total, per Crunchbase data. Along with the funding, the company acquired Battle Road Digital, a startup that makes simulation and wargaming software for the military and raised a $5 million seed round in 2023. The company's AI-driven collaborative and planning software is used by the U.S. Department of Defense to design, coordinate and brief complex military operations more efficiently, functions previously done on paper, through email and hand-written notes....

In Less Bad Arguments for Protectionism I offered a number of arguments for tariffs that, unlike the more common ones, are consistent with a correct understanding1 of the economics of trade; I do not find any of then convincing but someone else might. One had to do with national defense. Suppose we get into a war with China. It would be inconvenient if some of the things we needed for the war, ammunition, computer chips, drones, or something else, were things we did not produce because we had been importing them from China. So it might be prudent to use protective tariffs to keep critical industries going even if they could not compete with foreign competitors. It is not an absurd argument, but it has several problems, especially as a defense of the tariffs Trump actually imposed. Trump's tariffs were imposed on a wide variety of countries and goods, to first approximation tariffs on everything. A supporter might claim that protecting everything was fine since the more industries we have the more we can produce if there is a war, but he would be wrong; while a protective tariff benefits an import-competing industry, it harms export industries. If foreigners get dollars by selling us things they have to do something with them and the alternatives are either to buy US goods and take them out of the country, our exports, or to buy US assets, T-Bills or shares of stock, and leave them in the country. The less they sell to us, the less they will buy from us. As explained in an earlier post, the result of a tariff is to shift the exchange rate, the price on the dollar/yuan (or dollar /EU or dollar/') market, making dollars, hence American goods which are bought with dollars, more expensive. So a tariff that benefits an import-competing industry also harms all export industries; we are not getting more industries, just different ones. To argue that Trump's tariffs make us better prepared for a future war with China you need some reason to believe that the import-competing industries helped by tariffs will be more important than the export industries harmed....

In recent weeks, powerful atmospheric river storms have swept across Washington, Oregon and California, unloading enormous amounts of rain. As rivers surged, they overtopped or breached multiple levees ' those long, often unnoticed barriers holding floodwaters back from homes and towns. Most of the time, levees don't demand attention. They quietly do their job, year after year. But when storms intensify, levees suddenly matter in a very personal way. They can determine whether a neighborhood stays dry or ends up underwater. The damage in the West reflects a nationwide problem that has been building for decades. Across the U.S., levees are getting older while weather is getting more extreme. Many of these structures were never designed for the enormous responsibility they now carry. As a civil engineer at Tufts University, I study water infrastructure, including the vulnerability of levees and strategies for making them more resilient. My research also shows that when levees fail, the consequences don't fall evenly on the population....