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I think it might be relevant to note here that it's not really humans who are building current SOTA AIs --- rather, it's some optimizer like SGD that's doing most of the work. SGD does not have any mechanistic understanding of intelligence (nor anything else). And indeed, it takes a heck of a lot of data and compute for SGD to build those AIs. This seems to be in line with Yudkowsky's claim that it's hard/inefficient to build something without understanding it.

If Eliezer wasn't meaning to make a confident claim that scaling up neural networks without a fundamental theoretical understanding of intelligence would fail, then [...]

I think it's important to distinguish between

  • Scaling up a neural network, and running some kind of fixed algorithm on it.

  • Scaling up a neural network, and using SGD to optimize the parameters of the NN, so that the NN ends up learning a whole new set of algorithms.

IIUC, in Artificial Mysterious Intelligence, Yudkowsky seemed to be saying that the former would probably fail. OTOH, I don't know what kinds of NN algorithms were popular back in 2008, or exactly what NN algorithms Yudkowsky was referring to, so... *shrugs*.