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AI and the economy

 
 
 
pood

pood

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Maybe this is better in the Social Science forum.

I keep reading how AI is going to take all our jobs, not just mental labor but physical labor as well when it is successfully incorporated into nimble robots. I was just reading a thumbsucker from CBS online about “gradual disempowerment,” the idea that AI will soon make us all useless and feel useless as well.

So, AI will write novels and poetry, digitally paint pictures, make lawyers, accountants, and doctors obsolete, and when wedded to robots AI will serve beer in bars, serve as barbacks, do all sorts of heavy manual labor, construction work, probably have sex for us, and on and on.

I don’t think any of this will happen. But suppose it does.

What the long CBS thumbsucker never addresses is what I wanted to learn about most of all: If AI wipes out all our jobs, both mental and physical, who will have any money to pay for goods and services that AI will miraculously provide?

I realize billionaires are greedy bastards who hate all the poors, but as soon as no one can afford any of the goods and services that AI provides they won’t be billionaires for very long, or even thousandaires.
 
They could just sell stuff to each other.

Without a worker class they would stop mass producing the consumer goods that workers buy, and pivot to making robots and space yachts.
 
On the whole, it will be a better more abundant world without all of us breathers sucking up all the resources the multitrillionaires want for their own enjoyment. I mean, you don't really expect them to go live on Mars, do you? I fear the Nerd Reich to come, that is here now.
 
AI is apparently a highly useful tool for finding security flaws in software.

Whether that is a good thing depends in part on who is weilding it, and their motives.

Certainly it is causing a lot of flaws to become known very fast, which is probably better for the black-hats than for the white-hats - as a criminal, you only need to find one open door, while as a society we need everyone to be dilligent in securing every one of those doors as soon as they are found to be open. There's always some system somewhere that didn't get patched.
 
If AI lives up to the hype we will have to go to some sort of either universal income or subsidized jobs program. I favor the latter as the former is a potential deadly trap--if the situation changes and society needs them to work it will be much harder to recover from a situation where most people don't know how to work.

However, I would be very surprised if we reach that point. The only good uses we see of AI so far are cases where you don't need to count on it. Like the exposing security flaws--finding flaws is good. Trust an AI that all have been found? NOPE. Or the one that keeps showing up in her WeChat feed: used to be an attractive woman giving a short English lesson on half a dozen or so related words (or sometimes expressions). Now it's marked as AI and it's a little girl doing it. No, the mouth movement is too much and if you watch you can see the repetition of head movement. I'm sure the words are human, the girl's face is AI. Doesn't matter that the girl isn't perfect.
 
Loren Pechtel said:
If AI lives up to the hype we will have to go to some sort of either universal income or subsidized jobs program. I favor the latter as the former is a potential deadly trap--if the situation changes and society needs them to work it will be much harder to recover from a situation where most people don't know how to work.
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Wait, what?

Do you honestly think that people who don't work for money will not do work, or will somehow lose even the knowledge of what working is?

That's absurd. Unpaid work fills a large fraction of the waking time people spend outside of paid work.

Most people do housework (for zero pay) a lot of the time, even when they have a paid job; Retirees do plenty of such work.

Everyone will know how to work. There is a "risk" that they might stop being so keen to tolerate bullshit from bosses, but that's not the disaster you might think - productivity can be readily achieved without horrific working conditions, (though this fact is a closely guarded secret in the USA).

A universal basic income would not only be great for humanity, but likely also for the economy too. There's a reason why every player in the game of Monopoly starts with a non-zero amount of cash that is just handed to them for no reason. The game cannot even begin until every player has at least some money.

Money primarily acts as a signal to the economy about what is in demand. That signal cannot be sent by people who have no money. A minimal universal income for everyone would be an excellent idea. It would be inflationary, but that inflation can easily and simply be offset by an progressive increase in income taxation.

Of course, the big "problem" with such a scheme is that it would deny wealthy people a pool of very cheap labour. We would need to either automate, or pay very well for, drudgery. How terrifying.
 
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If redundant workers, also consumers, don't have the money to pay for the goods and services provided by AI/robotics, there is no profit to be made by the companies that invest in these systems. What then? The Government steps in to heavily regulate the economy, UBI for consumers paid for with high taxation rates on businesses that use these systems?
 
I repair rocking chairs and chandeliers, so AI does not threaten my job, as far as I know, so I'm not worried. Beyond that, I have a hard time taking seriously claims that AI will take our jobs. It will eliminate some jobs and will create some others. "Computer" used to be a job description. This goes back to the days when it became possible to accurately measure longitude at sea. This required a sextant, a clock, and a book full of tables which matched your time of day and angle of the sun to where you were. The tables in the book were the result of a lot of people with quill pens working out complicated mathematical formulas, one for every second of the day. They were called Computers. You can't find one today and nobody misses them. As for our modern computer, has anyone seen a typewriter lately?

All the anxiety about AI is an echo of people first became aware of the existence if electronic computers. This was just about the time we were getting used to adding machines. The old main frame computers and adding machines had one thing in common. Both helped produce an end product that was cheaper than the alternative.

The laws of gravity and the laws of economics cannot be repealed and can be resisted for only short periods of time. As it stands today, AI end product is being sold at a loss. A lot of it, mostly videos of kittens in Halloween costumes is provided for free. The businesses that are using it for actual productivity are not paying the true costs. The main reason for this is no one actually knows the true cost, yet. It's easy for a CEO to lay off a couple thousand people and say it's because of AI, when the real reason is he hired a lot more people than he really needed and business didn't grow quite as much as hoped.

As far as I know, AI has not yet produced a single dollar in profit. That's not unusual for a new technology. It took a long time for railroads to be profitable and that was only after most investors lost all the money they put into it. The Court of Economic Law has yet to render judgment, but it will eventually. Data centers are expensive to build, expensive to run, and expensive to maintain and the bill will come due at some point. Right now, all the AI companies are operating on investor money, supplemented by the sale of their service. Their projections which forecast profitability make wishful thinking look like an Emo band on Demerol.

I can't remember the last time someone called me because they were worried about my car's extended warranty. Instead, I get two or three calls a day(no exaggeration) from someone who is upset because my business does not show up in voice search services such as Alexa and Siri. I always ask, "How did you find my number? and they hang up on me. Today, I asked a customer to do a voice search for me and see if this was true. She held up her phone and said, "Give me a list of all the businesses in Baton Rouge that repair lamps". It gave her only one result and it was for a shop that closed it's doors about a year ago. That's not great news for me, but it's worse news for the people who think they are going to make money selling AI to consumers.
 
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