AI and The Taxman, Gut Bacteria and Alzheimer's and Clearing Landmines
April 13
This week we discover if AI will help The Taxman close all those loopholes that we all love so much. Maybe AI will help us find a new loophole or two? We investigate new findings in the relationship between gut bacteria and the development of Alzheimer's Disease. We look at a new, much softer method for detecting landmines. Finally we examine a new bow cover that makes international shipping more efficient.
Also a heads up, after 4 years of Substack asking me to turn on paid subscriptions I have finally done so. All current subscribers will continue to receive the newsletter for free for as long as I continue to write it. There is no need to do anything. If you have a friend that wants the newsletter please drop me a note in comments and I will add them to the free forever list as well.
I added the paid option (in part) as it gives me greater access to the new notes feature on Substack. Notes is a lot like twitter (no wonder Elon banned all substack links from twitter). It has only been open for a few days so little content but make sure you have a look. It is currently very much like the earliest days of twitter (nice and polite and very supportive). I will send you a separate invitation to join me on notes.
AI and The Taxman
We all love getting a little more of the tax that we pay, back from the Government. The Government loves to take that little bit more from each of us. Tax is sometimes seen as a contest of semantics “Is this payment a cost that is deductible or is it a capital cost or is it personal or can we fit it into some other category”.
Tax law in many countries is complex and difficult to understand. It is full of interpretation. Interpretation that can constantly change. Maybe AI is the solution? ChatGPT has recently passed various medical exams, it is able to help us in a myriad of ways, maybe it can help us with tax law?
Unfortunately ChatGPT barely gets a passing grade on tax exams. Even the easy exams on basic tax questions where flipping a coin would result in a 50% pass, ChatGPT only scored 70%.
The problem comes with what we commonly call loopholes. Tax law is a massive unwieldy array of laws, rulings and court decisions. Workarounds exist for taxpayers smart enough to find holes and exploit them. A taxpayer will get a ruling from the central tax authority and then combine it will another rule to produce an idea that saves a lot of tax. It is estimated that the use of unintended loopholes from combinations of rulings costs the US Internal Revenue Service US$500 billion per year.
The combination of rulings and the vast array of conflicting laws is why it is difficult for an AI to be an effective tax partner (for the taxpayers or the Government). That however, is going to change.
A team at Johns Hopkins are building an AI that they have called “Shelter Check” (like a spell checker but an AI that will seek out tax shelters). The AI will read prospective changes in tax law and inform legislators and tax officials about the ramifications of new tax law and warn them about unintended consequences.
This type of sophisticated analysis will require an AI to be able to read, parse, understand and bend complex tax law. The AI will first have to conquer the legalese used in tax law and then combine that skill with the deductive reasoning of a human. This is a vastly more skilled AI than current systems.
The team has made significant progress however their greatest fear is that a better funded development program from large tax payers, will develop a more sophisticated AI that has the capability to find new and more lucrative holes in the tax codes. These efforts on behalf of taxpayers will receive much less publicity however there is no doubt that they exist.
The future will be a battle of AI’s. I can just see the letters from the tax offices of the future.
“Dear Taxpayer,
Our AI has determined that the deductions claimed by your AI have no foundation in law. Your case has been forwarded to our compliance AI which will determine your punishment. You may appeal to our legal AI however such appeals must be commenced before any software upgrades are implemented in our system. No appeals will be allowed after software upgrades.
Best Regards
The Taxman”
Gut Bacteria and Alzheimer’s
Despite a lot of research over many years we are still very much in the dark when it comes to what causes, Alzheimer's disease. However we are finding that tensions between the brain, the gut and the makeup of its’ microbial inhabitants appear to play a critical role.
A recent US study focused on the relationships between Alzheimer's and the mix of organisms inside our digestive systems. Their analysis uncovered a genetic connection between different genera of gut bacteria and Alzheimer's in addition to a link between the microbes and a genetic risk factor for the disorder.
We have an assortment of bacteria in our guts (119 different types according to the study). It is usually a mutually beneficial relationship. These microbes will help protect our guts. However shifts in our immune systems and our diets can give some species advantages over others. These shifts can be for better or worse.
Research in recent years has focused on the complex relationship between the gut, its’ occupants, the immune system and our neurological functions. We hope this will tell us why some areas of the brain degenerate and result in memory loss and cognitive decline. Observational studies have identified a reduction in the diversity of gut microbes in individuals with Alzheimer's. Laboratory studies showed that gut bacteria can release chemicals that can induce damaging inflammatory signals in the brain.
In addition, a gene involved in moving fats through the blood, apolipoprotein E (APOE) has three versions in humans. The variant known as E4 appears to be a genetic risk for Alzheimer's (correlated only, causation has not been established). It is suspected that having one copy of APOE E4 may influence the composition of our gut bacteria.
The study identified 119 gut bacteria from thousands of participants. Four of those bacteria appeared to have a relationship with the APO variation E4, that is thought to raise the risk of Alzheimer's. One example is the Collinsella bacteria which has also been shown to have relationships with rheumatoid arthritis, atherosclerosis and Type 2 diabetes. Elevated cholesterol and low levels of low density lipoproteins combined with high numbers of Collinsella shows some link with neurodegeneration. Other protective bacteria were also uncovered that could counter the inflammation caused by the microbes in the gut.
There is still much research to be completed before we have a complete understanding of the causes of different types of Neurodegeneration. In the meantime, continue to challenge your brain. Learn a new language or a musical instrument as those activities will challenge your brain. Do a crossword if you enjoy crosswords however crosswords do not appear to help protect your brain. You just become better at doing crosswords.
Landmine Clearing
Over 100 million landmines have been deployed in war in over 60 countries. Landmines cause 6,500 casualties every year. The CSIRO in Australia have developed a new land mine detection technique.
The technology is based upon magnetic resonance that will detect the molecular signature of explosives used in landmines. Currently metal detectors are used to identify landmines. The problem is that metal detectors also pick up bottle caps and shrapnel. This significantly slows down the detection and clearance process.
Clearing the landmines from long past wars will enable more freedom of movement, greater access to food and water and a heightened level of safety for people living in former war zones. These new handheld detectors will speed up the process of clearing former minefields, improve confidence in detection and bring down the cost of demining.
MRead, the company established to commercialize the technology, plans to deliver their first detectors to The HALO Trust in 2024. The HALO Trust clears landmine affected areas in SouthEast Asia.
More Economical Shipping
Over 80% of the world’s trade is transported by Marine Transportation. This includes passenger ships, container ships, oil tankers and roll on roll off car ferries. It is the most efficient method of transportation that we currently have however it can be made more economical.
Ships face significant drag forces from winds when under sail. A team from Shibaura Institute of Technology in Japan and Hanoi University of Science and Technology have developed a new hull cover that will reduce the wind drag on ships.
Using a commercial software program for computing fluid dynamics simulations the team simulated a small passenger ship. The ship was divided into millions of elements using a numerical grid. The team then used the Reynolds averaged Navier Stokes equations to calculate the average fluid flow motion for each element in the model.
They then compared the performance of the ship when using seven different flat plate bow covers of different lengths and heights. They also compared a conventional streamlined cover. They found a 38% difference in total drag when using a 2.4 meter bow cover verses a 0.37m cover. This performance compares favorably to the streamlined cover however the flat cover is much cheaper to manufacture and install. Covers are able to be retrofitted and will save fuel and thus cost.
Paying it Forward
If you have a start-up or know of a start-up that has a product ready for market please let me know. I would be happy to have a look and feature the startup in this newsletter. Also if any startups need introductions please get in touch and I will help where I can.
If you have any questions or comments please comment below.
I would also appreciate it if you could forward this newsletter to anyone that you think might be interested.
Till next week.
The government could simplify the tax code and eliminate loopholes and absurd deductions, but it's far more likely that millions will be spent on dueling AIs.