Andrew Yang single-handedly moved the Overton Window on automation during Tuesday’s debate. Regardless of whether our national politicians are ready or not, automation and the 4th Industrial Revolution is an existential crisis that requires our attention and governance.
First, let’s get some basics on the board. You may have only paid attention to the World Economics Forum’s annual meeting in Davos this January because Trump elected to skip it. The conference’s theme was “Globalization 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution”:
Klaus Schwab, founder and executive chairman of the Geneva-based WEF, published a book in 2016 titled “The Fourth Industrial Revolution” and coined the term at the Davos meeting that year.
Schwab argued a technological revolution is underway “that is blurring the lines between the physical, digital and biological spheres.”
Simply put, the Fourth Industrial Revolution refers to how technologies like artificial intelligence, autonomous vehicles and the internet of things are merging with humans’ physical lives. Think of voice-activated assistants, facial ID recognition or digital health-care sensors.
Schwab argued these technological changes are drastically altering how individuals, companies and governments operate, ultimately leading to a societal transformation similar to previous industrial revolutions.
Not convinced that our world has changed significantly already? Currently, the biggest taxi company owns no taxis (Uber), the largest telecommunication companies don’t build any infrastructure (Skype, WeChat), the most valuable retailer has no inventory (Alibaba), the most popular media company creates no content (Facebook), and the largest movie house owns no cinemas (Netflix). These changes will only hasten in the future.
Inconvenient Truths
I believe that Andrew Yang is doing something similar to what Al Gore did when he released The Inconvenient Truth in 2006. That film presented a case for a warming planet, consequences of what might occur if this problem is left unchecked, and called us to action.
Fast forward to the present day and where are we now? The Green New Deal is finally on the scene and most prominent Democratic politicians have finally awoken to the existential threat of climate change. But all of this talk remains primarily rhetorical and aspirational, while the globe continues to warm around us to untold consequences.
How America and its politicians respond (or do not respond) to automation will have monumental consequences.
Automation and the Future
In 2016, Schwab predicted inequality would be the greatest societal concern associated with the Fourth Industrial Revolution.
“There has never been a time of greater promise, or one of greater potential peril,” he said.
Automation and artificial intelligence has already and will continue to occur in fields requiring primarily repetitive manual or cognitive labor whereas work that requires complex problem-solving, creativity, and human intuition will likely experience less or minimal automation.
That’s not necessarily a bad thing. Those futuristic promises of 20-hour work weeks and being freed to do the things we actually care rely or replacing humans with robots in unsafe work heavily on the fruits of the 4th Industrial Revolution. However:
Companies, governments and individuals are struggling to keep up with the fast pace of technological change.
Krieger, who served as the U.S. State Department’s first-ever representative to Silicon Valley from 2016 to 2017, said technology is often missing from policymakers’ “toolkits.” As a result, he said, companies are left filling a void trying to understand how to implement — and regulate — advancements like A.I.
“There’s an absolute hunger for concrete things companies can do,” Krieger said.
Automation’s Impact of Low-Wage Earners
As it stands now, lower-income individuals and people of color will bear the brunt of these effects since they are currently over-represented in high automation fields, as highlighted in McKInsey's just released report on the future of work in black America:
We project that African Americans in the 13 community archetypes we analyzed may have a higher rate of job displacement than workers in other segments of the US population due to rising automation and gaining a smaller share of the net projected job growth between 2017 and 2030. By 2030, the employment outlook for African Americans—particularly men, younger workers (ages 18–35), and those without a college degree—may worsen dramatically. Additionally, we find that African Americans are geographically removed from future job growth centers and more likely to be concentrated in areas of job decline. These trends, if not addressed, could have a significant negative effect on the income generation, wealth, and stability of African American families.
Preparing our society for these changes as early as possible will be crucial. If 78% of Americans already live paycheck-to-paycheck, then the associated consequences will be devastating without appropriate government intervention.
Skepticism over Automation
Some are skeptical about automation. Again, I return to the reception of An Inconvenient Truth to draw some parallels. Existing data will never show evidence of the true effects of any major change until after the change takes root.
What did the economic data say when Amazon was a scrappy upstart selling books at $3 less a pop than Barnes and Noble? Or how the iPhone would change literally everything about the way we work, play, and connect with others?
While projections can be wrong and biased, data will always lag behind and we are seeing this dynamic play out to devastating effects with climate change.
A Picture is Worth a Thousand Words
For the visually-oriented folks out there, I wanted to post some examples of automation in action to provide a glimpse of the acceleration that is likely to occur in the future (note: many of these videos are even 2-4 years old):
Intellectual/White Collar Automation
While the examples provided earlier showcase automation of repetitive manual labor, white collar work is far from immune. From a recent Yahoo Finance report:
“Financial services is going to go through a wave of automation,” Edelman said at Yahoo Finance’s All Market Summit Thursday in New York City. “Twenty-five percent of financial services jobs will be eliminated.”
Algorithms, next wave software, AI, and more will radically transform some work that has exclusively been seen as within the domain of human beings:
The Full Reach of Automation
As automation advances, our government needs to be prepared to proactively intervene, rather than react. NPR’s latest report on the Boeing 747 Max fiasco has the following to say, which highlights the importance of having politicians who are technologically competent and can act reasonably to ensure these societal changes promote social good:
The report also raises questions about the increased use of automation in airplanes and pilots' abilities to step in and take over if automation fails.
"This is not just an airplane problem, but an airplane-slash-pilot problem," said Hart in the conference call, adding that the FAA and regulators around the world need to better recognize "this new reality of super-complex automation and pilots not necessarily understanding how to operate it."
"As automation becomes more and more complex, pilots are less likely to fully understand it and more likely to have problems and more likely to encounter scenarios in real operations that they haven't seen even in a simulator," he said.
Beginning to Address Automation through Universal Basic Income
I won’t rehash Yang's Freedom Dividend proposal as it has been written about in prior diaries and covered in depth elsewhere. The beautiful thing (IMO) about Yang’s proposal of using UBI funded largely by a value-added tax is that even if Yang is wrong about the effects or scope of automation, the Freedom Dividend will still uplift millions and will do so with immediate effect.
And if the effects of automation won’t be felt until much later or at a smaller scale, it will give our society a fighting chance to prepare, rather than react after a majority of suffering has already occurred.
Automation, the 2020 Primary, and Andrew Yang
Plenty of technologists, futurists, economists, intellectuals, and others have been publicly discussing automation for years. But Andrew Yang is the first (and only) politician to have successfully brought this debate to the forefront of American politics.
We would be wise to imagine the impacts that automation and technology may have on our lives and identify the appropriate role of governance, even if one does not agree with Yang’s vision.