Accelerating Technology and the Economy of the Future 2 pot

... Cases 22 4 The Next 10 -20 years: Some Indicators to Watch for 22 7 Outsmarting Marx 23 7 The Technology Paradox 23 9 Machine Intelligence and the Turing Test 24 1 About / Contacting the Author 24 6 ... Views about the Future 115 The China Fallacy 117 The Future of Manufacturing 124 India and Offshoring 127 Economic and National Security Implications for the United States 128 Solutions ... haveasweanticipaterecovery from the current cri-sis and in the years and decades ahead? What will the economy of the future looklike?Among people who work in the field of computer technology, itisfairlyroutinetospeculateabout the like-lihoodthatcomputerswillsomedayapproach,orpossiblyevenexceed,humanbeingsingeneralcapability and intel-ligence....

... aregrowingdark.Nowweseethatmany of the verybrightestlightsin the tunnelfinallyfeel the impact and alsobegintolosetheirlight. The owners of the businessesin the tunnelareseeingmuch of theirwealthgraduallydrainaway. The ... mayhaveactuallyin-creasedforatime,astheywereabletolowertheirprices.Asaresult,theirprofits, and therefore the wealth of theirtopemployees and shareholdersincreased.Thesewere the brighterlightsin the tunnelthatinitiallybecamestronger.However,asnearlyallbusinessesin the tunnelcontinuedtoautomatejobs,atsomepoint the decreasein the num-ber of potentialcustomersbeganto ... between 20 01 and 20 09:injusteightyears,Billhasgainedover$1 ,20 0,comparedwithagain of only$ 82 over the 26 yearsleadingupto 20 01. THE LIGHTS IN THE TUNNEL / 24 CopyrightedMaterial–Paperback/Kindle...

... morepopular.Whatwillwedoifsomedayasubstantialpercen-tage of the three and ahalfmillioncashiersin the U.S.nolongerhavejobs?Whatadditionaleducation and trainingcanweoffertheseworkers? And whatjobswoulditpre-parethemfor? And what is the impact of thatpotential unemploy-mentonmarketdemandforgoods and services?Cashiersaregenerallynothighlypaid,buttheynonethelessexistaslightsinourmassmarkettunnel.Cashiers,justlikeotherworkers,drivecars,buyclothes and consumerelectronics,rent ... the world of science fiction. We think of the robots C3PO and R2D2 from the Star Wars movies, or perhaps the HAL 20 00computerfrom 20 01:ASpaceOdyssey.Asare-sult of this,wehavebeenluredinto the falsebeliefthatinorder ... the glassesisopen and the other closed. And, of course, the glassescouldberotatedinanydirection. And perhapstheyare touching or somehow entangled with other objects.Building and programminga...

... food—all of these and countlessthousands of otherstructures and chemicalsthatcompriseourbodies and make usfunctionareproteins. And theyareallconstructedthroughnanotechnology.Itislikelythat the coming“nanotech”revolutionwillbegin ... collating and faxing in-formation. The intellectualportion of the job—eitherap-provingordenying the loan—isprobablyalreadyessential-lyhandledbyacomputer.Throughout the economy, there*Formoreonrobotics and itspotentialimpactonemployment and on ... of the geometrically increasing technology line. Prior to the point where the impact be-comesobvious,thereisreallynowaypastdatacanshowthem the steepverticalpart of the linethatliesahead.The...

... economicgrowththatChinahasenjoyedinrecentyears.Evidence of thisisclearlyseenin the stallinggrowththat is resulting from the 20 08-9 recession. As of early 20 09,thousands of Chinesefactorieshaveshutdown and millions of workershavelosttheirjobs. The Xinhuanewstutinglowcostlaborforautomation.BYD,amanufacturer of batte-ries ... Amazontakeaper-capitaincomethatissomewhatcomparabletothat of developed nations and then multiply it by somehugefraction of the Chinesepopulation.In otherwords,theyassume that a very significant percentage of the 1.3billion ... Inventor and author RayKurzweil,whoreceived the NationalMedal of Technology THE LIGHTS IN THE TUNNEL / 1 12 CopyrightedMaterial–Paperback/Kindle available @ Amazonon the economy sabilitytocreatejobs,itisimportanttonotethattherearealsosignalswhichtendcontradictthisconclusion:before the advent of the currentcrisis,unem-ploymentasmeasuredby the government,remainedverylow.However,thereisalsoevidencethatunderemployment,especiallycaseswhereworkershavebeenforcedtosettleforoneormoreparttimejobsratherthanafulltimeposi-tion,hasbeenasignificantissueforsometime.Inshort, the evidenceisnotconclusive;butIthinktheremaywellbereasonablecauseforconcern.I...

... todecline.Rememberthatwearetalkinghereaboutaverageworkers.Toget the graphabove,youmighttake the dis-tribution of incomesin the UnitedStates and thenelimi-nateboth the richest and the poorestpeople.Thengraph the averageincome of the remaining“typical”people (the bulk of consumers) ... of India.Indiaisessentiallyanimpoverished,developingna-tionwithagovernmentthatisdemocratic,butalsooftenmired in bureaucracy. In the midst of this, India has anisolated island of enormous growth and prosperity: itssoftware and offshoringindustries.Indiawillface ... tolookinalittlemoredepthatsome of the mostwidelyheldconventionalassumptionsabout the future and seeiftheyarereallyreasonable: The primaryforcethatwillshape the comingdecadeswillbeglobalization.Offshoring of jobs and the con-tinuingmigration of manufacturingtolowwagecoun-tries...

... elimi-nates the jobsthatprovideincometoconsumers. The es-sentialideaisthatweshouldimposesomecombination of aconsumptiontax and/ oraspecialdirecttaxonbusinessthatcaptures the incomewhich,inanon-automatedecon-omy,wouldbepaidoutinwages.Overtime,as the wagespaidtoaverageworkersdecrease(asapercentage of reve-nue),thesetaxeswouldbegraduallyincreasedtorecaptureatleastaportion of thisincome. The overallobjectiveistorecapturejust the optimalamount of income and thengetitinto the hands of consumerssothattherewillbesuffi-cientconsumerdemandtocontinuedriving the economy. Once the income ... capturesourinterestforatime, the moststrikingrealizationisthatnothingelsehaschangedin the tunnel.Aswewatch,weseethat the lightscontinuetosoftlyimpact the panelson the walls of the tunnel as consumers purchase products and services. The businesses in the tunnel make no dis-tinctionsbasedon the color of the lights.Overtime, the process of creativedestructioncontinuesjustasit ... riskthroughout the entireworld economy, and thiswilleven-tuallyinvolvetransitioningtoamorerobustmodel. The Market Economy of the Future The scheme that I have proposed above essentially in-volvesadoptingspecialtaxestorecapture the incomefromlost jobs and then having the ...

... dramaticallynegative.In the UnitedStates,twothirds of workers and thereforeconsumers—donothaveacollegedegree.Whileeffortstoimproveeducation and trainingarelaudable, the realityisthatthisisnotlikelytooffset the impact of geo-metrically accelerating technology. Infact,Ithinkthat the THE LIGHTS IN THE TUNNEL / 23 0 ... havestrongeducations and training.Thesepeoplearebeneficia-ries of the informationage.On the toxicwastelandside of the fence, are relatively unskilled workers. These people THE LIGHTS IN THE ... Page 22 4 The Next10 -20 years:SomeIndicatorstoWatchFor.……………………………………Page 22 7OutsmartingMarx……………………………Page 23 7 The Technology Paradox…………………… Page 23 9MachineIntelligence and the TuringTest…….Page 24 1Appendix...

... acentrallyplanned economy,  and perhaps most chillingly, the overthrow of govern-ments and a“dictatorship of the proletariat.”In the wake of the collapse of communism, these ideas ... 38RobertJ.Shapiro,Futurecast:howsuperpowers,populations, and globaliza-tionwillchange the wayyoulive and work,NewYork,St.Martin’sPress, 20 08.39ThomasL.Friedman, The WorldisFlat:ABriefHistory of the TwentyFirstCentury,NewYork,Farrar,Strause and Giroux, 20 05, 20 06.40China’shighsavingrate the result of governmentpolicy,see:Ea-monnFingleton,In the Jaws of the Dragon:America’sFatein the ComingEra of ChineseHegemony,NewYork,St.Martin’sPress, 20 08.41PietraRivoli, The Travels of aT-Shirtin the Global Economy: AnEcono-mistExamines the Markets,Power and Politics of WorldTrade,JohnWiley and Sons,NewYork, 20 05,p40. 42 Ibid.p1 42. 43JeffRubin and BenjaminTal,“WillSoaringTransportCostsRe-verseGlobalization?,”CIBCWorldMarketsStrategEcon,March 27 , 20 08.Web:http://yaleglobal.yale.edu/about/pdfs/oil.pdf44Revenueperemployeenumbers.Source:GoogleFinance,basedon 20 08revenue.45“…growthwithoutjobcreation.”, The Economist,August11, 20 03.Web:http://www.economist.com/agenda/PrinterFriendly.cfm?Story_ID=198588946Huether,David, The Case of the MissingJobs,BusinessWeek,April3, 20 06.Web:http://www.businessweek.com/magazine/content/06_14/b3978116.htm47Technicallythismightbebettercalled“regressive”or“reversepro-gressive”since the deductionishigheratlowerwagelevels.However,thosewordshavenegativeconnotations…48FareedZackaria, The Future of Freedom:IlliberalDemocracyatHome and Abroad,NewYork,W.W.Norton&Co., 20 03,p.1 72- 173.Notes ... 51CorneliaDean,“ScientificSavvy?InU.S.NotMuch”,NewYorkTimes,August30, 20 05,web:http://www.nytimes.com /20 05/08/30/science/30profile.html 52 SeeChrisAnderson’s The LongTail:Why the Future of BusinessisSellingLess of More,abookbasedonanarticleinWiredMagazine,October 20 04.Web:http://www.wired.com/wired/archive/ 12. 10/tail.html53JohnMaynardKeynes,“EconomicPossibilitiesforourGrandchil-dren,”(writtenin1930),EssaysinPersuasion,NewYork,W.W.Norton,1963.Web:http://www.econ.yale.edu/smith/econ116a/keynes1.pdfp.195footnote,Einstein’sviewontechnologicalunemployment,see:WalterIsaacson,Einstein:HisLife and Universe,NewYork,Simon&Schuster, 20 07,p.403.Chapter...

... the world of science fiction. We think of the robots C3PO and R2D2 from the Star Wars movies, or perhaps the HAL 20 00computerfrom 20 01:ASpaceOdyssey.Asare-sult of this,wehavebeenluredinto the falsebeliefthatinorder ... hasquicklyattracted the notice of the Securities and ExchangeCommission and mayresultinnewregulation.Astheseexamplesshow,wecanexpectthat the rate of change and the volatility of nearlyeverythingarounduswill ... securitieswerethensoldtobanks and financialinstitutionsallover the world,with the understandingthattheywereverylowriskinvestments.When the subprimeborrowersstarteddefaulting, the value of the mortgage-backed securitiesplunged, and the derivativesdidnotworkasexpected.Inmanycasesitwasdifficultorimpossibletocalculatetheirvalue.Inaddition,financialinstitutionshadengagedinmanyothercomplexinterrelationships...