Leviathan Waking - by Dean W. Ball - Hyperdimensional
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Leviathan Waking<br>On Anthropic/USG, and a new era in AI governance
Dean W. Ball<br>Jun 16, 2026
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Introduction
Imagine that there were no Food and Drug Administration (FDA), but there remained a large pharmaceutical sector, similar in size and scope to the one the United States enjoys today. In this alternate world, imagine that drugs were officially not licensed; there were even officials in the executive branch who boasted that the U.S., unlike other countries, would not get into the regulatory morass of licensing drugs.<br>One day, a pharmaceutical developer warns that they think they have made a drug that cures a major Cancer at one dosage but is lethal at a slightly higher dosage. The company says, for this reason, that they are going to restrict release only to pre-approved patients and monitor their usage of the drug carefully—a sharp break from prior industry practice but one that the company insists, controversially, is necessary. This particular company had been advocating for years for stricter drug regulation, much to the chagrin of the government.<br>This causes a stir, and the government, not quite knowing what to do, announces that it will give drug developers the helpful option to show their drugs’ safety profiles to government officials before they are released. They are adamant that this is a voluntary program. The pharmaceutical company, being hopelessly literal nerds, and if we are being honest, more than a little bit obstinate, decides to release their drug without going through the voluntary program. “We already paused general availability of the drug while we did our own safety study, so we don’t need the government’s testing, and besides it is voluntary, isn’t it?” the company seems to be saying.<br>But then a handful of patients get side effects severe enough to hospitalize them, but not severe enough to be lethal. The government gets understandably upset, particularly considering their lack of experience in regulating drugs. “You talked up your own safety practices so much, and now we have people in the hospital. You are telling us that you are comfortable releasing chemicals that can put people into the hospital?,” the government argues to the company.<br>The company’s literal and obstinate nerds say, “well, we’ve thought about drug safety regulation quite a bit, and given how common hospitalization of a small number of patients is with a new drug, compared to the lifesaving benefits of our drug for millions, yes, we think the benefits outweigh the risks in this case.” But trust has already broken down, and this abstract, technocratic defense falls on deaf airs. “People are being hospitalized,” the government says.<br>And so the government bans the drug, indefinitely. It is not clear what the government wants more: a remedy for this specific side effect, a solution to all side effects from drugs, or, really, an apology from the company, as well as the sensation of domination over these disobedient, obstinate, and literal nerds.<br>In a matter of weeks, in our alternative world, the United States went from a system that was implausibly laissez-faire for the level of risk involved in this industry, to a system that was, in the eyes of essentially all expert onlookers, incomprehensibly strict and risk averse.<br>Fable, Jailbreaks, and Export Controls: What Happened
This, of course, is my read of what happened in the Trump Administration’s latest dispute with the AI company Anthropic. For those not following the blow-by-blow, what happened, in a few sentences, is:<br>Anthropic released Fable, a commercial version of their very-powerful Mythos model with severe guardrails to prevent misuse.
People liked it, though broadly speaking thought the guardrails were far too strict.
A few days later, officials in the Trump Administration (it is not clear who) became aware of a jailbreak that got around some of Fable’s safeguards (it is not clear how severely), and demanded that Anthropic de-deploy the model (it is not clear with how much specificity the government expressed the concern).
Anthropic did not de-deploy the model (it is not clear why), so the government imposed worldwide export controls against all non-U.S. persons on Fable and Mythos.
Because Anthropic lacks the ability to validate U.S. personhood for end users, this meant they had to pull down the models globally, for everyone. In fact, by some accounts, Anthropic has had to suspend internal usage of their model because of the risk that their own non-U.S. person employees might use the model.
You’ll notice the clause “it is not clear” repeated frequently above. The sheer opacity of everything that is unfolding makes it hard to analyze. There is no text for me to draw on, and no actual policy to criticize. There is simply a game of he-said, she-said played between two actors whose animosity toward one another is only growing and who both,...