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The Great Human Capital Devaluation Is Upon Us
People. Who needs 'em?
Not me. Or so I thought when I went into self-imposed exile a decade ago. No
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“It’s not exactly a secret that the “productivity gains” narrative in the context of AI is just euphemistic code for the outmoding of people.”
Say it aint so. Haven’t we been “promised” that AI will usher in an age of endless bountiful prosperity for everyone?
Didn’t Jensen assure us that those who are “right-sized” (nod to Chainsaw Al Dunlop) will simply pivot over to abundant jobs in medical care and construction? Especially now that Stephen Miller is creating openings in those fields?
CBI – Dear Leader, I’m wondering if that golden promise proves to be faulty, might that be the trigger for the sea change in voter attitudes which would allow CBI to, at least, be seriously debated? Even in red states where the notion of self-reliance has held sway since 1945 or even 1865?
It’ll be interesting to watch. When international sourcing and off shoring first started impacting the availability of decently-paying jobs in many areas, the GOP masterfully pinned the blame on NAFTA and other liberal policies. Somehow the fact that that US companies adhering to maximizing shareholder value were equally to blame was overlooked.
This time will the right again be able to put the blame on smelly foreigners when they are being put out of work by US companies? Our cosseted US champions? But would anyone in MagaLand even wonder about that? I’m really skeptical about that, but stranger things have happened!
To be fair, the “powers that be” (regardless of who it is) don’t have a choice. This is an arms race, and you can’t let the “old foe” out in the East get ahead.
Maybe in the context of military technology. Outside of that, in the new bipolar world, does having some kind of temporary lead really matter all that much?
“L’enfer c’est les autres”
One of the first novels I had to read for college was Kurt Vonnegut’s “Player Piano” (1952). I won’t recommend it as a great read, but it is about a dystopian, near-future world, where automated machines have replaced nearly all human workers. Society is essentially divided into well-off “tech” managers and engineers, and what are seen as nearly meaningless masses who are assigned to do manual work such as reclamation projects and road repairs (the “Reeks and Wrecks”). Spoiler alert: it ends in a failed rebellion.
UBI? COGS? a little help here? Thanks
Universal basic income, cost of goods sold.
I vision my grandkids with a scan tag like a piece of fruit at market. Scan her, get immediate cost to GDP and other metrics….glad I’m almost 81……
I’m sure I’m not the only one on here to be happy to see what you wrote about interpersonal relationships, so I’ll just say as much, and assume I’m speaking for many of us who value your incredible work here over the past decade.
It is easy to analyze this with an implicit assumption that only a certain amount of work needs to be done each day and therefore if some tasks are completed at lower costs than human only then there are fewer jobs.
However I think the net effect is much more complicated. Take a robotic weeder for instance which uses ai pattern recognition to avoid the crops. The robotic weeder can do a job without hitting the crops with damaging herbacides which then promotes more production. The robotic weeder is therefore increasing production and saving costs on herbacides. The human capital to set up and keep operating teh robotic weeders is likely much more than the human capital cost to maintain a sprayer.
If it was not for ai the choice would be to have humans controlling the robots. Doing the pattern recognition. However wholly unaffordable. In this case the ai is doing a job at a lower cost than humans and making the entire industry possible whereas before it was completely unaffordable. Therefore i do not see all the robotic weeder like future technologies but history has taught us smart people use these technologies to create new jobs we can scarcely imagine today.
All of this happening at a time when we have the most billionaire-friendly administration possible and a laughable social safety net that’s still somehow under attack. Wonderful timing.
Yes that is a travesty and likely to waste much of the potential which can permanently improve the human condition rather than to temporarily satisfy greed for people who do not need the money or power.
UBI? From this Congress? What, would they have to – gasp – tax the rich? Unthinkable.
Before that, they’ll be slicing Social Security and Medicare. Because, with eroding payroll contributions, it’s the only responsible thing to do. Otherwise they might have to, heaven forbid, tax the rich.
Meanwhile, investors will richly reward the CEOs who RIF the most heads. We always do. The Mags are doing it, other big companies are following, and at conferences and breakouts, investors are praising them and asking why not more?
AI efficacy isn’t even necessary. Let’s face it, most big companies could misplace a few percent of headcount without any immediate problems, at least none that will trouble top management. A few more percent, well someone has to take one for the team. Call it AI so the CEO looks visionary. You can always hire back in a year, get younger and cheaper heads in the bargain.
H, you’d make a great dad. Now, all you need is a wife. You might actually stop punishing yourself and allow yourself to be happy. 🙂
There will likely be a lot of bumps, problems and mistakes, but I can definitely envision a world with AI, combined with robotics, that improves the lives of humans and gets us to a significantly shorter working week.
So what would humans do with more free time?
Contrary to what Elon is telling you, robotics are nothing new. I’ve been investing in them for 15 years and I was in late. I have yet to see massive benefits trickle down to the workers on the shop floor.
Well humans could do like hunter gatherers who spent 2-3 hours/day on acquiring and eating food (healthy diets) and the rest of the time interacting with family and community, napping, having sex, thinking (especially about their environment – plant types, weather,…) etc.
Then again, humans would probably do what humans do…get greedy, get hateful, etc.
We live in a Garden of Eden, yet can’t escape the lure of that Apple.
This piece once again illuminates what’s going to be the obvious outcome of AI intrusion into business processes, increased productivity (=> human capital redundancy and increasing layoffs to save money.) That’s nice except for a couple of “Catch 22s. First, and most obviously, people without jobs can’t buy what’s for sale => GNP goes down and people starve. Of course, UBI might help but, 1) who will pay for that? Not the government. People with no jobs don’t pay taxes and government requires taxes. Right now half the population doesn’t actually pay income tax. That just gets worse. 2) Then the safety net’s gone so people start to die … AI doesn’t create profit growth, it just saves money. No GDP growth from productivity cost savings because sales are down => growth down. Larry Ellison bought the largest company in the medical records business and essentially shut it down to eliminate a competitor. As a result my son-in-law who had a unique and complex skill set has now been out of work for over two years for the dual issue of AI in HR, and the acquiring company being essentially gone. There will be no new glorious, creative jobs for those replaced by AI. Such jobs would be too expensive. The burgeoning AI trend is going to destroy all of us. The only thing that will be left will no growth grunt work.
The history of automation has been that it creates net new jobs on balance. The jobs also are higher paid. However there are bumps and grinds. I once saw a machine that replaced 50 workers and allowed the company to compete with chinese workers. Those 50 workers paid the price but the benefits were a quickly accrued by the operating manufacturer who could then sell worldwide in competition with the chinese companies making the same product.
“the benefits were a quickly accrued by the operating manufacturer who could then sell worldwide in competition with the chinese companies making the same product.”
Exactly. Well, until their Chinese competitors adopt the same machines. In fact, China has been the largest purchaser and installer of robotics for at least five years, I believe.
Yuval Harari his book NEXIS fully explores the role of many humans after AI – their key role is simply to consume things
Add all the technology you can, but it never changes the human operating system’s strongest driver – scarcity mentality. A human’s biggest threat is another human. The least valued commodity in a human dominated planet is humans. While AI computing power is impressive, human nature dictates we will turn it on ourselves.