A Trial by Fire and the New Social Contract

The challenges before us remain immense. As I outlined in an earlier blog post, within fifteen years I predict that we will technically be able to automate 40 to 50 percent of all jobs in the United States. That does not mean all of those jobs will disappear overnight, but if the markets are left to their own devices, we will begin to see massive pressure on working people. China and other developing countries may differ slightly in the timing of those impacts, lagging or leading in job losses depending on the structures of their economies. But the overarching trend remains the same: rising unemployment and widening inequality.

Techno-optimists will point to history, citing the Industrial Revolution and the nineteenth- century textile industry as “proof” that things always work out for the best. But as we’ve seen, this argument stands on increasingly shaky ground. The coming scale, pace, and skill-bias of the AI revolution mean that we face a new and historically unique challenge. Even if the most dire predictions of unemployment do not materialize, AI will take the growing wealth inequality of the internet age and accelerate it tremendously.

We are already witnessing the way that stagnant wages and growing inequality can lead to political instability and even violence. As AI rolls out across our economies and societies, we risk aggravating and quickening these trends. Labor markets have a way of balancing themselves out in the long run, but getting to that promised long run requires we first pass through a trial by fire of job losses and growing inequality that threaten to derail the process.

Meeting these challenges means we cannot afford to passively react. We must proactively seize the opportunity that the material wealth of AI will grant us and use it to reconstruct our economies and rewrite our social contracts. The epiphanies that emerged from my experience with cancer were deeply personal, but I believe they also gave me a new clarity and vision for how we can approach these problems together.

Building societies that thrive in the age of AI will require substantial changes to our economy but also a shift in culture and values. Centuries of living within the industrial economy have conditioned many of us to believe that our primary role in society (and even our identity) is found in productive, wage-earning work. Take that away and you have broken one of the strongest bonds between a person and his or her community. As we transition from the industrial age to the AI age, we will need to move away from a mindset that equates work with life or treats humans as variables in a grand productivity optimization algorithm. Instead, we must move toward a new culture that values human love, service, and compassion more than ever before.

No economic or social policy can “brute force” a change in our hearts. But in choosing different policies, we can reward different behaviors and start to nudge our culture in different directions. We can choose a purely technocratic approach—one that sees each of us as a set of financial and material needs to be satisfied—and simply transfer enough cash to all people so that they don’t starve or go homeless. In fact, this notion of universal basic income seems to be becoming more and more popular these days.

But in making that choice I believe we would both devalue our own humanity and miss out on an unparalleled opportunity. Instead, I want to lay out proposals for how we can use the economic bounty created by AI to double-down on what makes us human. Doing this will require rewriting our fundamental social contracts and restructuring economic incentives to reward socially productive activities in the same way that the industrial economy rewarded economically productive activities.

This won’t be easy. It will need a multifaceted, all-hands-on-deck approach to economic and social transformation. That approach will rely on input from all corners of society and must be based on constant exploration and bold experimentation. Even with our best efforts, there remains no guarantee of a smooth transition. But both the cost of failure and the potential rewards of success are too great not to try.

Let’s begin that process.

First, I want to examine three of the most popular policy suggestions for adapting to the AI economy, many of them emanating from Silicon Valley. These three are largely “technical fixes,” tweaks to policy and business models that seek to smooth the transition but do not actually shift the culture. After examining the uses and weaknesses of these technical fixes, I propose three analogous changes that I believe will both alleviate the jobs issues while also pushing us toward a deeper social evolution.

Instead of just implementing mere technical fixes, these constitute new approaches to job creation within the private sector, affecting investing and government policy. These approaches take as their goal not just keeping humans one step ahead of AI automation but actually opening new avenues to increased prosperity and human flourishing. Together, I believe they lay the groundwork for a new social contract that uses AI to build a more humanistic world.

Posted by Dr. Kai-Fu Lee on Jun 13, 2019 in All Posts AI and You In the Media

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