Broadly speaking you can think that the mental reduces to the physical (physicalism), that the physical reduces to the mental (idealism), both reduce to some other third thing (neutral monism) or that neither reduces to the other (dualism). There are many arguments for dualism but I’ve never heard a philosopher appeal to “magic spirits” in order to do so.
Here’s an overview: https://plato.stanford.edu/entries/dualism/
(In fact, the very idea of "computable functions" was invented to narrow down the space of "all things" to something much smaller, tighter and manageable. And now we've come full circle and apparently everything in the universe is a computable function? Well, if all you have is a hammer, I guess everything must necessarily look like a nail.)
So yeah, the o3 result is impressive but if the difference between o3 and the previous state of art is more compute to do a much longer CoT/evaluation loop, I am not so impressed. Reminder that these problems are solved by humans in seconds, ARC-AGI is supposed to be easy.