Futuristic

FUT 31

[00:00:00] SS: Just an ease.

[00:00:05] CR: Okay, I’m recording. Turn on my backup record. Give me a one, two, three.

[00:00:13] SS: One, two, three.

[00:00:17] CR: Welcome back to the Futuristic Sammartino episode 31. Uh, we’re recording this on the 25th of October, 2024, two weeks before the U S election, January. Um, one year before the Singularity, um, one year before Elon Musk releases RoboTaxis and RoboVans and robots to the world or two or five, depending on Elon’s timeline, just before we came to where I showed Steve the Tesla stock chart, they released their earnings today, share price.

[00:01:00] CR: Bumped 22%, their biggest day in 11 years for all of the Elon haters out there that were shitting on the RoboTaxi launch a week or so ago. Have you been Steve? How’s the future treating you these days?

[00:01:13] SS: If you’re just treating me okay, when you said one year out from RoboTaxes, I was like, I said 2015, because wasn’t that when he made the promise? This is like,

[00:01:21] SS: we’re 10 years in to coming soon. Jeez, I’ll tell you what, you’d be

[00:01:25] CR: As he himself,

[00:01:27] SS: trailer and they said coming soon to a theater near you.

[00:01:29] SS: Be lining out the front,

[00:01:30] SS: 1977 Star Wars, you’d be like, what’s going on?

[00:01:35] CR: as he himself said at the RoboTaxi launch coming out by 2026, but I am often a little bit over optimistic with my launch date. So let’s say 2027 at the latest. Uh, well, look, the future’s complicated, Steve. Things are sometimes harder than they seem. Objects may appear closer than they really are when you’re looking in the Elon Musk rear vision mirror into the future.

[00:02:01] CR: Steve, um, one of the things that we want to talk about today, I’ve been trying to get some time to talk to you about this for a while, and a couple of our listeners have asked for this, is a deep dive on the UBI, um, which isn’t a, which isn’t a urinary tract disease or something, a form of birth control.

[00:02:21] CR: Um, universal.

[00:02:23] SS: that. It’s got a real medical

[00:02:25] CR: it will be, maybe it

[00:02:28] CR: could be both. We don’t know. Maybe it will

[00:02:29] CR: be a form of birth control because you won’t have enough money to actually afford to have children. The, uh,

[00:02:35] SS: UBI, the greatest birth control ever invented. Well, we’ve already got that with the property crisis. That’s, that’s birth control, isn’t it?

[00:02:45] CR: yeah,

[00:02:46] SS: by a policy as well. You know, one of the big policies there is you only pay half the tax on money you make through property. What a great idea.

[00:02:55] CR: mm, mm,

[00:02:56] SS: Because money is more noble than

[00:02:58] SS: labor, Cameron, to our government.

[00:03:00] CR: well,

[00:03:01] SS: Hmm.

[00:03:02] CR: more noble than the Labor Prime Minister is buying 4 million beachfront properties, Steve. He’s done okay out of the property market. Um. I’m not sure how a Prime Minister is able to afford a 4 million, uh, like a, not just a Prime Minister, but a career long politician. He’s not like Malcolm Turnbull, who was like a multi millionaire when he came in.

[00:03:22] CR: He’s a lifelong union labor guy, buying a 4 million beachfront property. But let’s not get distracted, Steve. Um, like I’ve been talking to UBI for, uh, 10 or 15 years. It’s an idea that’s been around for a long time that we’re going to have to have one of these things eventually. Not always directly related to the idea of AI taking our jobs or robot taking our jobs.

[00:03:54] CR: They’re often part of the conversation, but usually it was just sort of what capitalism was doing to incomes, offshoring jobs, and stuff like that. But Over the course of the last year or so, as I’ve been trying to figure out where our economy is going over the next five to ten years as a result of AI and robots, I can’t escape the conclusion that we’re facing a severe and significant re engineering of the fundamental economics Of Western Civilization.

[00:04:32] CR: Uh, which makes it hard because I run an investing podcast and we’re always talking about, uh, you know, the prospects of companies into the. Future, uh, intrinsic values and, you know, forward cashflow projections. And I’m always saying, I don’t know, don’t know what the world’s going to look like in five years from now, but, um, fortunately we just have to live in the present moment.

[00:04:56] CR: You know, Steve, I know you’re, you’ve been a skeptic about UBI on the show in the past

[00:05:01] SS: sceptical and I’m still anti, so let me just play my cards straight up, I agree there’s issues coming our way, I think UBI is a terrible idea, absolutely fundamentally disastrous. And that’s my position. So that’s, I guess, going to force our discussion. That said, I agree with your opening premise.

[00:05:27] SS: We are heading for a significant fundamental shift in the way society

[00:05:34] SS: and all economies globally work.

[00:05:38] CR: well, as I’ve said on the show before, it doesn’t, Require very high net unemployment number to crash an economy. Like it’s, it doesn’t, I think sometimes people think, Oh, well, you know, that would require 50 percent of all jobs to be gone or something like that. Yeah. The great depression and the major recessions that we had, like the Keating recession that we had to have, we were talking high single digits, 10%, uh, unemployment.

[00:06:14] CR: And that has severe, um, recessionary or depressionary, uh, characteristics. I’m just checking my facts here. The unemployment during the Great Depression was 10 percent in 1929, which was already high just before then, 21 percent by mid 1930 and 32 percent by mid 1932. So it escalated well beyond that sort of 10 percent level.

[00:06:46] CR: You know, it, it, it snowballs, I guess is the point, you know, because when you have an economic crash like that, uh, money disappears out of the economy. You end up with people don’t have jobs, so they don’t have an income, because they don’t have an income, they can’t pay taxes, so governments that rely on taxes can’t provide services, uh, businesses that rely on people spending money to buy stuff.

[00:07:11] CR: don’t have those customers anymore. So businesses go broke. They have to let go of employees and, you know, it, it can escalate. It’s like a negative spiral that kicks in pretty quickly. So if we’re assuming, uh, as I am, that AI is going to start to take a chunk of initially white collar jobs, as I’ve talked about before, starting with maybe low level, uh, white collar creative.

[00:07:37] CR: journalistic type jobs. And I was showing you last night, this latest version of, uh, image generation tool, text to image generator, ideogram. ai launched their version two yesterday, which is better than mid journeys. I think I produced not only a futuristic, uh, banner out of, I said, make, make the word futuristic out of rusty cogs on a factory workbench.

[00:08:07] CR: And it did. Then I told it to make some word marks, like a, a logo. It got there. The wording right every time. Mid Journey, I still struggle. And even with, um, DALI, I still struggle to get it to write words consistently. Now, to be fair, when they first launched the latest versions of DALI and Mid Journey, it did do a good job, and then, for whatever reason, it seems to have deteriorated in its ability to get words right over the Next couple of months.

[00:08:34] CR: Ideogram, uh, at the moment anyway, was doing a perfect job getting words correct. So I, you know, my immediate thought is this, you know, as soon as these things are consistently reliable, give me 20 logos or 20 word marks for this business. You got a lot of freelance graphic designers that are shit out of luck with this kind of stuff, uh, very, very quickly.

[00:08:57] CR: But then, as it escalates, Up the food chain, we end up with quite a lot of unemployment. And the question then is, what do we, how do we handle that? Now, if, if you don’t, and so for people who have never read much about a UBI, universal basic income is this idea that everyone is provided with a certain amount of money by Usually a government or, you know, it could be in a Sam Altman vision sense, his UBI startup, that’s going to take profits from open AI and distribute them back to the masses.

[00:09:35] CR: Some form of regular income that enables you to survive when you don’t have a job. Anymore. And you know, maybe it’s just a survival income so you can pay rent and have food, uh, and maybe it’s enough for you to be able to go and fulfill your dreams of learning how to, I don’t know, carve wooden spoons or something like that, uh, follow your hobby instincts, but if you, if you don’t think a UBI is the path to income replacement, Steve, is the model that, um, you see.

[00:10:09] CR: As a solution to the

[00:10:11] SS: In short, it’s redistribution of wealth. That’s the short answer, which is a number of things. The first one could be antitrust activity. So that those that have removed the labor and own the capital, the capital then gets distributed in society.

[00:10:30] SS: So it’s kind of like anti monopoly. Redistributive wealth or anti, well, why would, why would there be no jobs?

[00:10:39] SS: That’s the first thing. Why would there be no jobs? And if there is no jobs, Where did the money go? Like, we actually got to go back a few wires. We’ve got to ask a few questions on, before we say AI ate all the jobs, we actually have to go a step back and then another step back and then another step back, and you’re going to see the root of the problem.

[00:11:01] SS: Because what we’re jumping to is this assumption. We’ve got this economy at the moment that works, that

[00:11:06] SS: does all of these things. Okay. It includes,

[00:11:10] CR: Steve. It’s all the dinosaurs fault. If the dinosaurs hadn’t have fucked shit up 200 million years

[00:11:14] SS: that’s right. A lot of people that don’t know that, um, so, uh, they don’t know that, uh, if, if jobs disappear, what, why do jobs disappear? Like, let’s, let’s ask that question first. We’re going to ask that. We know that AI and robotics can replace people. Yes. And which we, which creates, let’s call it structural or technological unemployment.

[00:11:37] SS: True. That’s the reason we might need a, Uh, UBI? Do we agree on

[00:11:41] SS: that?

[00:11:44] CR: Oh, hi, Mark. Yes, we agree on that.

[00:11:50] SS: All right. So

[00:11:51] SS: why did those jobs go away?

[00:11:55] CR: Well, the jobs will go away because, uh, business managers and business owners will have the opportunity to replace, uh, 30, 40, 000 a year job with a piece of software that they will pay 100, 200, 1, 000 a month for whatever it

[00:12:16] SS: And They do that to why do they do that? To get more what?

[00:12:20] CR: They do that to maximize their profits.

[00:12:23] SS: Okay. So they’re doing it to maximize their

[00:12:25] SS: profits.

[00:12:27] CR: And also to stay competitive. I mean, if, if their competitors are doing it, they have to do it to cut their costs to stay competitive. I mean, it’d be a combination of those.

[00:12:38] CR: The reasons we always have automation to decrease costs, to remain competitive, to increase profits, and also to add new services ostensibly that they couldn’t deliver before in a cost effective

[00:12:52] SS: So if they do that

[00:12:54] SS: and people go away,

[00:12:57] SS: do their, does their people go away in their jobs? Now people go away. First, the people go away with the jobs, but guess what else goes away too when people lose their jobs? Either that money, either that money, that extra profit goes in one of two places. The extra profit gets redistributed back to the populace so that they can continue to spend, or prices have to drop and they get competed away, which frees up new money to be spent elsewhere where new people will be

[00:13:30] CR: Why do prices need to drop?

[00:13:34] SS: Because if they don’t drop, going to have less demand, because less people in the economy, people have got to buy stuff. See, the problem at the moment is

[00:13:44] SS: robots don’t buy things.

[00:13:48] CR: Yes. I mean, it depends. I mean, yes, there’ll be a lag there though, is what

[00:13:52] SS: there’s a

[00:13:53] CR: Prices don’t necessarily need to drop. If your cost base is

[00:13:57] CR: reduced,

[00:13:57] SS: you cut if your customer base is a different bunch of people.

[00:14:02] CR: Yeah, yeah, Yeah.

[00:14:04] SS: But what happens though, if, if the labor market shrinks, the economy shrinks too, unless the reason, and you mentioned it in your own first analysis is prices drop because you have to do it because everyone’s doing it. For example, if you’re making your cars by hand and everyone’s making them by robot, yours will cost him too much.

[00:14:26] SS: You won’t be able to sell them or make enough money and you get out competed and then your business

[00:14:30] SS: dies. Let’s just use the car

[00:14:33] CR: over time.

[00:14:33] SS: right?

[00:14:35] CR: Over time, But

[00:14:35] SS: over time, over time. over

[00:14:37] CR: quickly.

[00:14:38] SS: But what generally happens, what generally happens with structural unemployment, and it depends on how fast it happens or technological unemployment, is that the cost of production goes down. So long as you don’t have a monopoly, right? You have to compete. So even though your product costs go down, your margins go down. And if your margins don’t go down, right? Because You have to compete because everyone’s competing. Then new, new people will enter that market to try and get those high margins, entry and exit to the marketplace because you’re making abnormal economic profits.

[00:15:18] SS: Unless you’ve got a

[00:15:18] SS: big moat, which is usually a monopoly,

[00:15:22] CR: Well, it also depends. I mean, it depends on the barrier to

[00:15:25] SS: barrier to entries, barriers to entry. So yeah, competitive moats or high capital expenditures, those types of things. So usually when the price of something comes down, Everyone does it. The price comes down with the product cost as well. They both decline because you compete away those excess profits that would be

[00:15:46] SS: made by a reduced Cost and production.

[00:15:50] SS: Then that money gets freed

[00:15:51] CR: A says, well, if company A says, if we

[00:15:54] CR: reduce our, our, uh, price by 5%, we’ll pick up 6 percent market share. So, and

[00:16:01] SS: And we can do it. And we can do it because our cost is lower than our competitors, right? And then your competitors go, we better get that new technology to reduce our cost. And then we’ll match them with our price, but they match them with their price, even before they get the new tech, because they do that while they get the tech.

[00:16:16] SS: So they don’t lose too much money. Everyone competes down. So long as you’ve got competition, you will compete away the excess margin that gets invented via automation, right? Then that money that used to get spent on product A, then gets spent on product B. And in product B, which is often a new category that doesn’t exist, labor transitions across to it.

[00:16:42] SS: And what we need to do is not give UBI, but help people transition or put in place legislation to protect

[00:16:53] SS: the people from the capitalists.

[00:16:57] CR: In what way? Protect them in what

[00:16:58] CR: way?

[00:16:59] SS: Protect them from having monopoly power on necessary goods and maintaining their

[00:17:05] SS: margin and having an anti competitive environment.

[00:17:10] CR: Well, I, I see, Two issues with what you just said. Number one, this whole idea of transitioning people to a new skill or a new job, which historically is what has always

[00:17:21] SS: It’s what has always happened Yes.

[00:17:24] CR: when the Luddites were

[00:17:26] CR: unhappy about, uh, you know, machines being introduced to, you know, knitting factories. Um, Those, you know, the, the, the people that formerly were doing whatever those fucking machines were that the lullets were

[00:17:42] SS: Lathes. Was it lathes? No, not a lathe. It was a No, not a lathe. It was a

[00:17:47] SS: It was the, um, geez,

[00:17:50] CR: Yeah. Some sort

[00:17:51] CR: of material manufacturing, I forget. You know, those people were re skilled into something else or their children were re skilled and re tooled into a different thing. That’s always been the way it’s happened. Horse and buggy manufacturers ended up getting jobs in a Ford factory. The problem is, is I can’t see.

[00:18:11] CR: What the new jobs will be. And that’s not

[00:18:15] SS: no one can.

[00:18:16] CR: look into a crystal ball. No, no, no. But it’s beyond that. It’s beyond our inability to see around the corner. It’s because you have to conceptualize what kind of a job. will not be done better by a super intelligent AI and or super intelligent AI with anthropomorphic robots and any other kind of robots that you want.

[00:18:40] CR: Like the, I cannot even begin to conceive of What kind of a job can be done better by a human than an AI

[00:18:53] SS: All right. So that’s a

[00:18:55] CR: Outside of maybe teaching violin. I think Chrissie’s

[00:18:59] CR: got a job

[00:18:59] SS: but, but no, no, you know, let’s assume that teaching violin can also be done better by a robot, a humanoid robot with incredibly dexterous fingers, who knows how to play perfectly every classical violin piece in the world. Let’s assume that that is also going to happen, but I would, I would go in a different direction.

[00:19:17] SS: I would say that there are already. An inordinate number of jobs that can be done better by machines that we still choose humans to do because a human is doing it. And some of them are the most highest paid jobs in the world. Now, they’re not for everyone, but I’ll give you a couple of examples, okay? A robot can do a better version of Taylor Swift for free, because I can listen to every song she’s ever had or made or recorded on Spotify, perfect studio version wherever I am for free. watch the video.

[00:19:53] CR: you can’t, you have to pay Spotify.

[00:19:55] SS: 10 bucks, whatever. All right. I’ve got every song ever

[00:19:57] SS: made for 10 bucks a month. It’s as good as

[00:20:00] SS: free.

[00:20:00] CR: you’re living in,

[00:20:01] SS: It’s as good as free. Mate, I used to pay 30 bucks for 12 songs. I used to pay 30 bucks for 12 songs on a CD and, and force myself to listen to the album to, to like

[00:20:11] SS: them because you’ve spent your money on it.

[00:20:13] SS: You’re

[00:20:14] SS: in, which was sometimes

[00:20:16] CR: had them for life

[00:20:17] SS: ended up liking

[00:20:17] CR: you got rid of your CD collection.

[00:20:20] SS: yeah. All right. So. But, but I can’t get a

[00:20:24] CR: As opposed to what? Going to a Taylor Swift concert.

[00:20:27] SS: Which is a different product. I understand. It’s a different product. I get it. It’s

[00:20:31] SS: a different product. But

[00:20:33] CR: you’re not

[00:20:34] SS: that I’m there, you’re not

[00:20:35] CR: the music.

[00:20:36] SS: not actually buying the product.

[00:20:38] SS: I’m buying the emotional connection that I am there live with other

[00:20:42] SS: humans who are also there at that moment and I will pay an ultra

[00:20:46] CR: buying the experience.

[00:20:48] SS: Right. And you’re buying the experience because it’s human. Now I would, I would argue, imagine this. Imagine that in the future we have, it could even be 10 years away, right?

[00:20:58] SS: The perfect humanoid robots that look and feel with soft exoskeletons and grown flesh Terminator style to have Taylor Swift with all of her dances, the exact same constant setup. And we can, it sounds exactly like her, even with the croakiness in her voice and the imperfections are put in there. And I can go to the MCGNC, the Taylor Swift.

[00:21:22] SS: Robot version for 50 or the Taylor

[00:21:26] CR: It’s already happening, dude.

[00:21:28] SS: wait.

[00:21:28] CR: It’s called

[00:21:29] SS: know it’s already happening. I know they’ve already got virtual concerts. I know with ABBA and all of that. I know.

[00:21:34] CR: It’s the ABBA virtual concert.

[00:21:35] SS: I

[00:21:36] SS: get it.

[00:21:37] CR: And it’s, people are going to see virtual versions of

[00:21:40] CR: ABBA.

[00:21:41] SS: because ABBA won’t turn up in the real. Now, that’s because ABBA

[00:21:44] SS: have said, yeah, we’re out here, kids.

[00:21:46] SS: We’re done. We’re done. Fernando,

[00:21:48] CR: 20 year old.

[00:21:49] SS: Fernando. Can you hear the drums, Fernando? No, I cannot. I am sitting home in Sweden, listening to a national radio, and doing an interview with Molly Meldrum in 1982, because I ain’t going, right? Now. Let me finish, man. I know that this is happening, but let’s, it’s the dancing Taylor Swift.

[00:22:08] SS: It looks exactly like a robot. And, but you can go and see the actual her for 500 bucks or the robot crew for 50 bucks. I promise you people are lining up for the Taylor 500s, the 500 versus the robot version, because most of the things

[00:22:23] SS: that we consume, right, are in our head. It’s what you get in your head.

[00:22:29] SS: Also,

[00:22:30] CR: of those graphic designers that are out of work can go become Taylor Swift.

[00:22:33] CR: But

[00:22:34] SS: I did say that this is an example that is a little bit extreme.

[00:22:37] CR: so what are the, what are the realistic things that people can go do when their jobs get neutralized by AI?

[00:22:47] SS: I don’t know yet.

[00:22:49] CR: Exactly.

[00:22:50] SS: Yet,

[00:22:52] CR: And not, not even

[00:22:53] SS: going to be,

[00:22:53] CR: jobs, but give me

[00:22:54] SS: I didn’t know there was going to be, a

[00:22:55] CR: me an example of a job.

[00:22:57] SS: Okay. I didn’t know that there would be 30 million app developers

[00:23:01] SS: in 2005 because there was no such thing as the

[00:23:03] SS: iPhone.

[00:23:05] CR: Yes, you did. You knew people were going to be building software. You didn’t know what the platform or the device was, but 25 years ago, if I had said to you, Steve, what do you think some of the big jobs are going to be in the future? You

[00:23:17] SS: right. Well, let’s go back further. Okay. I could say software. All right. Let’s go back to 1600. To go to 1600 and say, what do you think the big jobs will be in the year 2000? You couldn’t guess because 90 percent of humans worked in agriculture and now it’s like 5%. We didn’t know then that there’d be mechanics.

[00:23:37] SS: We didn’t know then that there would be, uh, any of the things really we do now, whatever the 95 percent other things are that have arrived,

[00:23:46] SS: we didn’t know then.

[00:23:47] CR: Yeah, okay. Look, I, I

[00:23:50] CR: get it. we don’t know what the new things are, but my point is that I can’t even imagine any kind of job outside of a small handful of things. Like I talked about teaching violin, and even that’s potentially replaceable, and teaching Kung Fu is potentially replaceable, but I, I still think most people would probably prefer, depending on the economics of it, to learn from a human than a robot.

[00:24:15] CR: Those sorts of situations, but if a robot’s for free, because you’ve got one in your house already doing your cooking and your cleaning, and you go, oh, by the way, it can also teach your kids violin and kung fu, you’re probably going to go, oh, fuck it, let’s just do that, right? Because it’s got the, it’s got the, it’s got the software, it can tap into the

[00:24:32] SS: The other potential too is that a lot of these things that robots can do, especially when they’re personal services, they really could reduce the cost of things really significantly because I don’t think the robots are just going to take people’s jobs. Right. Which might be 20 percent of the cost of product, right?

[00:24:51] SS: They may also have the potential to organize things at the molecular level to move us to a near zero marginal cost society where most things become really, really, really reduced in cost. And then potentially

[00:25:06] SS: we

[00:25:06] CR: but you still need money.

[00:25:07] SS: you still need money, but I think,

[00:25:09] CR: So where’s the money going to come from? You said redistributing the wealth, but when I asked you to explain the mechanism by which that had happened, you went back to the dinosaurs. So,

[00:25:19] SS: got to take, you’ve

[00:25:20] CR: tell me what the mechanism is.

[00:25:23] SS: tax, breaking up companies. And

[00:25:26] CR: And then what do you do with

[00:25:27] SS: well I don’t think you can do a UBI,

[00:25:30] CR: Well, how do you do it?

[00:25:31] CR: How do you redistribute the money? How does it go from tax to me?

[00:25:42] SS: don’t think you do, well we already have redistributing

[00:25:44] SS: money to people who are unemployed now, so that kind of UBI already exists to a certain extent.

[00:25:49] CR: That’s it! It’s a UBI!

[00:25:51] SS: not en masse. Not en masse. and That is the show Thanks for

[00:25:55] SS: joining us.

[00:25:56] CR: 10 minutes. I took Steve from UBI is fundamentally wrong to we want to

[00:26:02] SS: Nah, well, I think the money doesn’t go to UBI.

[00:26:05] SS: I think it goes to building new industries, re education, and here’s what I honestly think deep down in my heart of hearts. I’m going to tell you what, I think the highest paid jobs are going to be because a human is doing it. Human labor in human things that robots can do. The simple examples I’ve given, this is the lowest in the, I’m double ending it here, Cameron, double ending.

[00:26:27] SS: I’ve gone Taylor Swift to a waiter or a service staff, right? I think service staff, uh, humans doing things at a, basically, you’re going to pay more because a human is doing it.

[00:26:42] SS: Because you want the human connection.

[00:26:44] CR: that?

[00:26:44] SS: Because you want to look someone in the eye and see the sweat on their brow. We already do that all the time now, with so many things. Like right now, you could go Most people buying coffee when they go to a cafe and paying 5 for something that could be 30 cents at home isn’t because of the coffee.

[00:27:00] SS: I’ve got a machine at home, I make coffee just as good as the one down the road. But I walk there and go there and say hello because we are a social species who want to connect

[00:27:10] SS: with people physically, mentally, emotionally. And I think those physical

[00:27:15] CR: are you connecting with your, your barista

[00:27:18] SS: I’m talking to them, they’re my friends, they’re my people.

[00:27:22] CR: for how long?

[00:27:22] SS: Oh no, it’s 10 15 minutes.

[00:27:26] CR: You talk to the barista

[00:27:28] SS: yeah, I sit around there and I get my coffee and I

[00:27:30] CR: how many customers are at these cafes you go to

[00:27:33] SS: busy, but I’m there, I’m their person.

[00:27:35] SS: I’m, I’m,

[00:27:35] CR: and they’re talking to you for 15 minutes?

[00:27:37] SS: not, not constantly

[00:27:40] CR: leave, I bet they’re like, oh, thank God that fucking Sammartino guy’s

[00:27:43] CR: gone. I’m like, I’m trying to, I’m trying to make coffees here. He just sits there, he’s talking, he’s

[00:27:48] SS: I’m serious.

[00:27:49] CR: obviously lonely.

[00:27:50] CR: He needs a podcast so

[00:27:51] CR: he can actually talk to, talk to someone.

[00:27:55] SS: No, I’m

[00:27:56] CR: I think cafes are like the Tyler, the Taylor Swift

[00:27:59] CR: experience. I go to a cafe. Uh, usually to meet my, my, my adult sons, we’ll play chess and we’ll drink coffee. And we’ll talk these days, mostly about the U S election or my, that or AI or social media is what we’re talking about, but it’s, it’s, it’s a, it’s the experience of getting out of the house, sitting somewhere.

[00:28:20] CR: And yeah, getting served, but just, you know, it’s, it’s about, you’re, you’re paying for the environment. You’re paying for the experience of getting out of your house. I’m not paying for the service staff,

[00:28:31] SS: Well, I

[00:28:32] CR: uh, as human connection. I’m not paying for the human barista.

[00:28:35] SS: I’m paying

[00:28:35] CR: a shit if it was a robot serving

[00:28:37] CR: the

[00:28:37] SS: see,

[00:28:38] CR: I’m, I’m going out

[00:28:39] CR: because of the people I’m sitting at the table with, not.

[00:28:42] CR: The person delivering the

[00:28:43] SS: Well, I’m actually, no, I actually, I like to see the people who work in establishments where I develop relationships, and maybe I’m just a very, very lonely guy,

[00:28:54] SS: but I genuinely, I genuinely like

[00:28:58] CR: Minimum wage! You like to be around minimum wage people so you can go

[00:29:03] CR: Yeah, look at that poor sucker

[00:29:05] SS: mate I can’t believe you would infer

[00:29:06] SS: that, I’m a minimum wage guy who did paper rounds and worked at Hungry Jack’s

[00:29:11] CR: I know, you’re like, but I remember! You’re like, yeah, I

[00:29:13] CR: remember when I was When I wasn’t rich too, you SUCKER!

[00:29:17] SS: I’m not, you can’t infer that, that’s, I’m, I’m in a wealthy country, but you know, I’m normal, um,

[00:29:26] SS: in the middle, somewhere in the meaty part of that middle

[00:29:29] SS: curve. In the middle of that, that meaty curve.

[00:29:32] SS: But look, I genuinely want to

[00:29:34] CR: so your argument is that we’re gonna that businesses your argument is that business owners are gonna pay more than they have to to have humans working for them when they

[00:29:45] SS: Nah, that’s not my

[00:29:46] CR: robot for a tenth of the

[00:29:48] SS: It’s not my argument. I’m saying that a lot of

[00:29:50] CR: Well, who’s who’s paying

[00:29:51] SS: my argument. I’m saying a lot of the things that we pay a premium for, Right? And we do it already, Cameron, a lot. We do, we have a lot of things that we pay for because they’re personalized. When we can get robotic versions of them at home for a whole lot of reasons.

[00:30:09] SS: Yes, you go to the cafe for the ambience and the

[00:30:11] SS: people and you sit with and all of that experience. I’m saying

[00:30:14] CR: what? Give me, give me more examples then.

[00:30:21] SS: well, I gave you the music one, the live music, which is one, whether it’s Taylor Swift or whether it’s someone at your local pub, you go into the local cafe, you go to the restaurant, you like the people there, you like the people that you do business

[00:30:32] SS: with. For me, I do events, right?

[00:30:37] CR: you don’t have an, you can’t do business with a

[00:30:39] SS: Okay, I do events and I do keynote speeches, all right? You ready? I’m about to, I’m about to give up the ghost here and tell everyone my trick. There is nothing you can’t learn by watching a YouTube video online rather than coming into a room where I’ll do a speech for 45 minutes. Right? And probably more entertaining than me, funnier than me, smarter than me, more researched than me, but for some reason, people, yeah, right, for some reason people want to turn up, go to that room, interact with each other, watch a monkey on a stage, have a few ideas that aren’t as good as something you can see online and you get paid a good amount of money to do it.

[00:31:16] SS: Now that’s another example. Basically, whenever you see a human doing something, most of those things now, they’re not robots necessarily in the way that you infer, most of those things are available and better for anyone to get online, but they still choose the human side of

[00:31:32] SS: it.

[00:31:32] CR: Yeah. Okay. But that’s, that’s like, that’s just the Taylor Swift example on another level,

[00:31:36] SS: but, yeah, but wait a minute, I gave you three examples. I gave you three,

[00:31:40] SS: right?

[00:31:41] CR: none of them were good.

[00:31:42] SS: Well, in your

[00:31:43] SS: opinion. In your opinion, but we don’t need to get there because here’s what’s going

[00:31:47] CR: Everyone, go vote online.

[00:31:49] SS: go vote online, but

[00:31:50] CR: com slash vote.

[00:31:51] SS: okay, we don’t need to worry about it because here’s what’s going to happen and here’s what has always happened.

[00:31:56] SS: All right? A company finds a way to automate things. The other companies who compete automate it as well. They compete with each other on price. The price is dropped. The money gets freed up. New industries are invented, before automation arrives in that industry, people go work in that industry, then that new industry gets automated, margins get competed away, and, and the money moves sideways.

[00:32:19] SS: The easy example is, music is the perfect

[00:32:21] CR: will be new industries.

[00:32:22] SS: So music is the perfect example, right? Where did the 30 of a CD go? Where did it go? Like, where did it go?

[00:32:31] CR: to

[00:32:31] CR: Spotify,

[00:32:32] SS: No, but not all of it, because you used to spend way

[00:32:34] SS: more. If you’re into music, you’d spend

[00:32:36] CR: Jobs and Spotify.

[00:32:38] SS: Right. No, but where did it

[00:32:40] SS: go? This is, this is, this is

[00:32:41] CR: well, people, people spend less on, I mean, I don’t know what the net net is, but I don’t go and buy, uh, you know, I, I thought I previously would have spent maybe 30 bucks on a CD, maybe three or four times a year. Now I spend 20 bucks a month on Spotify. So it’s actually 240 bucks a year on music rather than 120 bucks a year on music, but.

[00:33:08] CR: I get a lot more music, um, and the artists

[00:33:12] SS: That’s what automation does.

[00:33:13] CR: and the labels get less.

[00:33:14] SS: yeah, you get, labels get less. But where did the money you

[00:33:17] SS: spent go?

[00:33:18] SS: Because you, you’re not earning less money.

[00:33:19] CR: Spotify.

[00:33:20] SS: No, but let’s

[00:33:21] CR: Oh, where did my

[00:33:22] SS: yeah, that’s actually the question. It’s not.

[00:33:24] CR: to 15 video subscriptions.

[00:33:27] SS: Yeah, So

[00:33:28] CR: Netflix, is

[00:33:28] SS: that’s what I’m

[00:33:29] SS: saying, though. This is what I’m saying, Cameron, and it’s easy to just poo poo it. no, no, no, no.

[00:33:34] CR: but what I’m saying is there aren’t going to be new

[00:33:36] CR: jobs that people go to,

[00:33:39] CR: because the new, there will be no new jobs that AI and robots can’t do better and cheaper and more effectively than humans.

[00:33:47] SS: well, you’re assuming that it has to always be cheaper is the thing that people want.

[00:33:54] SS: Sometimes people want things because they’re expensive. Look at the richest person in the world. One of the richest, Sir Bernard Arnault. Look at him. What does he sell? Overpriced handbags. An overpriced fashion. And it’s not the billionaires that are buying it.

[00:34:08] SS: It’s people like mortgaging their house and spending 10 grand on a bag that they shouldn’t because they want the emotional attachment with the fact that that bag was pretended to be handmade somewhere. And they over invest in it. That’s because of what it is emotionally. And what I’m saying is that so much capital will be freed up because many things that used to be expensive, expensive, will come down in price so, so radically because of AI and automation and competing the prices down.

[00:34:34] SS: Money gets freed up into new industries where people, the most premium product you can buy is no longer a handbag or a brand. It’s like, I had a massage by a human today. What? Did you get the massage by a human? They used to do it in the 60s. Yeah, well, I got massaged by a human. Look, I know that the, the Momo massage robot is, is, is amazing.

[00:34:56] SS: But I had Terence today and Terence’s fingers, I could feel the fingers on the back of my skin when he massaged me with this, uh, herbal oil that he got from Southeast Asia. How much was it? It was 780 for 20 minutes. What? 780?

[00:35:11] SS: A Momo robot only cost 100 and You have it in your house. But Terrence was so nice when he

[00:35:16] CR: don’t even have a job.

[00:35:17] CR: How did you afford to pay 780? You don’t even have a job. You

[00:35:21] SS: but I do have a job. But I do

[00:35:23] SS: have a

[00:35:24] CR: What is it?

[00:35:25] SS: I don’t know yet. I don’t know.

[00:35:27] CR: You’re giving Terence a massage after he gives you a

[00:35:29] SS: It’s a double massage scenario. I, I, the point, what I’m leading with is not what the jobs are. I’m leading with something different because what you’re gravitating

[00:35:42] SS: towards right now, Cameron, Not Cam. Cameron. I’ve Cameron, do.

[00:35:47] CR: Oh, you’ve camera’d me. What are you, my mother?

[00:35:49] SS: is your leading with what are the jobs? I’m not leading with that. I’m leading with the economics of the fact that the only reason, the only reason that you would automate something

[00:36:02] SS: is to reduce cost and unless you’re a monopoly. Yes.

[00:36:06] CR: It’s not the only

[00:36:06] SS: and quality.

[00:36:07] CR: it’s also, if

[00:36:08] CR: it can be Custom quality, yes,

[00:36:10] SS: right? Okay, put them both

[00:36:11] CR: Quality, it can be done

[00:36:13] SS: cost and quality can be done better, faster, whatever, right? That is why you would do it. If you would do that, your competitors would do it too.

[00:36:23] SS: Now,

[00:36:24] CR: Yeah,

[00:36:25] SS: if you leave the prices up high, And there’s margin, others will enter that market, so long as the barriers to entry aren’t too high. And if what we are saying is true, because automation is becoming so cheap and so omnipresent, humanoid robots, AI and everything, and open source, then we have to also assume that the barriers to entry would be low.

[00:36:47] SS: Therefore, a couple of players who reduce their cost with automation, they either bring their prices down or new entrants come in the market. And force the prices down because there’s margin to be had, right? That happens. That money gets freed up. The 30 of the CD gets freed up. I’m talking about the process of where money flows, right?

[00:37:10] SS: And I don’t know what is next. Maybe it’s retro stuff that you get humans to do, or maybe it’s things we didn’t even know we needed, wanted, like, we don’t know what they are yet. Just like in 1500, or even 70 years ago, or 50 or 30 years ago, there’s a lot of things we do today that we didn’t do. Humans are inventive.

[00:37:29] SS: Alright, we are very, very good at inventing ways to spend money we thought we would never spend money on, right? Like my dad reminds me, how many times did we go out for breakfast, Steve? When we grew up, approximately how many times did we go out for breakfast? Approximately, Steve. And the number being zero is very easy for me to give the approximation.

[00:37:50] SS: Right? Zero. All right? Money spent on break. There’s a whole lot of things we spend money on today. And I really wish I had written the list before I got into this podcast. But I was asleep on the couch because it was nap time and all of that. So,

[00:38:03] CR: That’s why you were

[00:38:04] SS: that’s why, no, it wasn’t why I was

[00:38:05] SS: late. Um,

[00:38:07] CR: you were doing your hair.

[00:38:08] SS: I,

[00:38:10] CR: Thought you were doing your

[00:38:11] CR: hair.

[00:38:11] SS: It does look nice

[00:38:12] CR: always looks

[00:38:13] SS: I had a haircut the other day.

[00:38:14] CR: always looks

[00:38:15] SS: Thanks, mate. And so,

[00:38:18] SS: so that money gets freed up and we are creative and we will invent new ways to spend that money. And in the short run, in the short run, right, we have to organize how to do these things that humans want and that thing arrives and then the money shifts to that and then the process of automation continues.

[00:38:35] SS: So I don’t think that we’re ever going to get to that place of mass automation. Removing jobs. And I don’t think that lag is going to be there like it is with the recession because the recession is based on perception of what the future is like. Whereas automation is based on reality and they’re very, very different because the perception is based on behavioral economics.

[00:38:59] SS: Things get bad or there’s too much demand and the interest rates go up and everyone

[00:39:02] SS: panics and they stop spending and you get into a negative spiral.

[00:39:06] SS: An inflation spiral and an unemployment

[00:39:08] CR: Unemployment isn’t perception If people don’t have jobs that’s not a

[00:39:13] SS: No, no, no,

[00:39:14] CR: That’s a, they don’t have jobs

[00:39:16] SS: but most of most of the recessions that we’ve had have been because of economic shocks that haven’t really been because of technological shocks.

[00:39:25] CR: that’s not what we’re talking

[00:39:26] SS: But we’re talking about a technological shock creating unemployment. We’re not talking about, no we’re not, we’re not talking about, um, a GFC where, uh, a lot of companies went broke and so they had to unemploy people or, or let people go.

[00:39:42] SS: We’re not really talking about that, are we?

[00:39:45] CR: No,

[00:39:46] SS: so it doesn’t have the same behavioural impact, because if you have a shock in the share market, or an economic shock, right? Companies make decisions based on what they believe will happen. And therefore they invent it. It’s behavioral economics, whereas this is

[00:40:01] CR: talking about a situation. 30%.

[00:40:04] SS: you’ve got to have automation be implemented, implemented new pricing, different behavior, but it’s, it’s more elongated.

[00:40:12] SS: Then an economic shock that leads to a recession, like a share market crash and a panic, which is what happened in 29. It also is what happened in 2008. It was also what happened in 1991. By the way, our highest unemployment rate ever since the recession. What do you think it

[00:40:30] SS: was, Cam? I looked it up.

[00:40:34] SS: Nah, it was,

[00:40:35] CR: the great

[00:40:35] SS: yeah, it was, it was close to 30 in Australia as well.

[00:40:39] SS: It was 11 percent

[00:40:40] SS: in 1991.

[00:40:43] CR: Um, I don’t know why you think it’s going to be elongated, because I think that

[00:40:48] SS: Because, because I’ll tell you why. I’ll tell you why I think it’s going to be elongated. No, I’m just going to answer this one question, and then you can tell me why I’m wrong. Which, which I’ve probably been a lot of today, but that’s okay. I think it’s going to be elongated because the lag time between something being

[00:41:05] CR: Elon Musk gated?

[00:41:06] SS: Elon Musk, it’s like an Elon Musk robo van.

[00:41:08] SS: It’s elongated. It’s just, it’s just an infinite timeline.

[00:41:15] CR: Yeah, sorry, go

[00:41:15] SS: Uh, uh, well, this is the funnest one we’ve had.

[00:41:22] SS: Uh,

[00:41:22] CR: I knew this was going to be fun, because I knew we were going to

[00:41:24] SS: oh, we disagree a lot because I, I work with a lot of large companies who have every resource in the world at their disposal. Alright, I’m doing some work at the moment with Seabus, right? Giant multi billion dollar building firm. Haven’t implemented any forms of modern modular 3D printing, construction, all of these things which can save them 50 percent in time, in production.

[00:41:50] SS: Uh, they’ve got a whole lot of challenges with the software that they use. Things are all fragmented. And they’ve got every resource you could imagine in their industry. I work with a multitude of companies, Rio Tinto, who could do far more automation in their, in their minds, don’t really do it. They’ve got automated trains.

[00:42:09] SS: The reason it’ll be elongated is the lag between something being possible and something being executed against in large companies. Is usually really, really long for a whole bunch. Even if the finances stack up and you say, we’re going to go to automation. Yep. It’s going to be better. The finances stack up on a whole lot of tools right now today.

[00:42:30] SS: And yet these companies haven’t implemented them. Now, do I think that we will go with AI and robotics? Absolutely. And I think AI before robotics, cause it’s really easy to remove an information worker more than it is a physical worker. And that’s the opposite of what a lot of people expect. Remember they said, Oh, blue collar are dead.

[00:42:48] SS: Now it’s more, it’s the white collar that are, that are going to get crushed. And in the modern economy, that’s probably a bigger percentage as well, but the implementation with software that can improve them with companies, the lag is huge. That’s why I think it’s going to be elongated. That was a long answer.

[00:43:03] SS: I’ll let you get in a word. Edgewise has arrived. Get

[00:43:06] SS: your word in.

[00:43:10] CR: think that’s the most solid argument you’ve made on the

[00:43:13] SS: Oh, thank God I finally made one.

[00:43:18] CR: Companies, you know, we’ve both had a lot of experience in the IT industry. Companies Peace. tend to be very slow to roll out major IT implementations and things like that. But one of the reasons for that is it’s very difficult because you have humans that are running your IT department. If you’ve got an AI system that’s going to do all of the implementation for you, it may speed things up.

[00:43:46] CR: But I don’t think The really big companies doing big IT implementations is really where we’re going to see the impact of AI in the workforce first. I think it will be small to mid sized businesses that are desperate to cut their costs and that will be able to implement AI faster than a lot of the big corporations that have a, it’s like turning around a battleship.

[00:44:14] CR: But again, I’m still Okay, let’s assume that you’re right, that uh, there are still jobs to be had for enough of the people, then we don’t need a UBI, but uh, cause people will be redeployed and we’ll be able to find work, and as you said,

[00:44:35] SS: Money changes places.

[00:44:36] CR: which I wrote, I wrote, I wrote about in my Mind Mapping the Future

[00:44:40] CR: article that we talked about an episode or two ago.

[00:44:43] CR: The implementation of AI and robots and nanotech when it arrives will drive the cost of production down, which should drive the cost of products and services down. And, you know, we should find that we have a decrease in the cost of living as a result. Uh, housing aside, but even housing, you know, if we have a million robots building houses for us, um,

[00:45:09] SS: In places you don’t want to live, of course, but they can build them. I mean, you can live in the Simpson Desert if you want. We’ll get a robot out there in no time.

[00:45:17] CR: yeah. And actually I think that’s one of the big opportunities, like, um, business opportunities is going to be using robots To

[00:45:24] SS: entirely new Yeah, because hasn’t China done that? Don’t they have like, ghost suburbs and cities that they’ve built with no one in them?

[00:45:33] CR: Not with robots, but

[00:45:34] SS: Yeah. Well, you know, they treat their people like robots up there. Cam, you know that.

[00:45:39] CR: okay, no, no, enough of the anti China stuff, man. Come on, we’re better than that. Um, uh, we, we. Let’s say that people still have jobs. Um, I don’t know what those jobs are. No one can tell me what kind of a job AI and robots won’t be able to do better than humans.

[00:45:57] CR: But you’ve got this

[00:45:58] SS: that they don’t have to be better.

[00:46:00] CR: touch, high human service. Um, big corporations and governments might be slow to implement stuff. Um, but then outside of that, getting back to this idea of redistribution of So if you look at the Google sheet that I prepared for today, um, You know, when I talked about in potential solutions there, I talked about automation taxes.

[00:46:28] CR: Let’s say that we do want to redistribute the wealth, which is where you started. And then you changed your mind and said, we won’t need you

[00:46:32] SS: Oh, that’s, that’s what podcasts are for, changing

[00:46:34] SS: minds, even if it’s your own.

[00:46:37] CR: It’s your

[00:46:38] SS: Well, it is one of the best

[00:46:39] CR: Well, honestly, talking about stuff is how we think through things, right? So that’s why I enjoy talking to you because it makes me Anyone else

[00:46:48] SS: don’t fall in love with my, I’m happy to change my mind on ideas.

[00:46:51] SS: If, you know, and, and I’m exploring what

[00:46:53] CR: make me think.

[00:46:55] SS: I’m exploring what I

[00:46:56] CR: Well, when I talk to anyone

[00:46:57] CR: else about this sort of stuff, their eyes glaze over in

[00:46:59] CR: about 15 seconds, and that’s it. They just

[00:47:01] SS: Yeah, likewise, likewise.

[00:47:02] CR: away.

[00:47:03] CR: They walk, they walk backwards. Very, say, oh, I think I left the kettle on, and they try and get out of my, uh, vicinity. Or Chrissy comes and saves them, and says, Okay, Cameron, I think they’ve had enough from you now. And rescues them from me. Um, So automation taxes was one of the things that I put there. So a tax on AI or robots that are replacing human workers.

[00:47:27] CR: I actually think that as a legislative option is a good one. Okay, so, Mr. Employer. You’ve got, you’re currently paying, um, Jane Bloggs, uh, 50, 000 a year to do her job. You can replace her with AI for 10, 000 a year and you have 40, 000 a year profit. What you can, what we’re going to make you do is you have to split that profit with Us, and you can keep half.

[00:48:02] CR: So take 20, 000 of that, add it to your bottom line, happy days. The other 20, 000 has to go to the UBI fund, and then we redistribute that. Maybe back to Jane, or maybe it just goes to Jane. You have to pay that to Jane as a dividend for the rest of her life, uh, that 20, 000 a year. Or maybe you give it to the government, then they redistribute it.

[00:48:27] CR: I think it’s just easier if you just give it to them. And it’s legislated, so anyone who terminates somebody on the basis that they’re going to replace their job with an AI or a robot, um, you have to split the profit with them. Uh, there’s also the idea of increased capital gains or wealth taxes, um, Particularly for companies that are profiting from automation, higher consumption taxes, GST, for capturing, you know, the, the existing or continuing revenue that’s coming from spending that gets redistributed or corporate taxes, increased corporate taxes, just straight up companies that are making way more money

[00:49:05] SS: We need to do that anyway.

[00:49:07] CR: go of all of their

[00:49:07] SS: We need to do that before the AI revolution. But there’s, there’s something really interesting that you mentioned there, which hasn’t really occurred that much yet. It has a little bit, but not a great deal. Is an entire job being replaced by automation. There, there are examples, of course.

[00:49:24] SS: I’m, I think a production line in a car factory or production lines are good examples. Supermarkets are a visual example that we’ve all seen. Um, ironically, uh, It wasn’t robots, it was stupid customers who ended up doing the work themselves, doing

[00:49:41] SS: self scanning. Um,

[00:49:44] CR: I don’t know if it’s stupid. I prefer to do it myself.

[00:49:47] SS: I don’t mind either, because it’s the same amount of time standing there anyway, and you do it yourself, and you pack it yourself. But look, there are, there aren’t that many examples where a person gets replaced in totality. Usually parts of the job get removed through automation. Certainly in White Collar, that’s been the case.

[00:50:06] SS: And an example might be, um, lawyers used to do A certain part of the analysis, now AI’s, large language models might be able to do big parts of that. And the lawyer then does more FaceTime with customers and more customers talking to customers. You sort of layer up in this sort of new sphere that is a layer above the AI’s talking to the AI’s.

[00:50:27] SS: And we sort of become, let’s say the, the guardians or, or the bureaucrats. We’re like bureaucrats that. Assess and manage a whole bunch of AIs who are doing the hard stuff and we’re almost like they’re, they’re political, uh, overseers that sort of organize the ethics and the behavior of the different ro I don’t know.

[00:50:50] SS: It, it may be that to an extent, but it’s very rare that you see a full job get replaced. It’s usually pieces of it and that’s why we’ve been able to adapt so far. And so it’s really hard to say, Jane blogs, Um, her 50 grand, we replaced her with 10 and she’s gone because usually Jane blogs doesn’t go in one go.

[00:51:10] SS: Parts of her jobs

[00:51:10] SS: go away.

[00:51:15] CR: look, I, I understand the theory behind that. And I think there are some jobs like lawyers, uh, that, where that may be true, but you know, when I wrote

[00:51:25] SS: in business and commercial, commercial scenarios, like when you worked at Microsoft, all those kinds of commercial scenarios, there’s a lot of things that AI could do, but there’s a lot of things that you never got to on your to do list that frees you up to do, which is kind of what’s happened

[00:51:38] SS: with automation to this point in white collar scenarios.

[00:51:42] CR: yeah, but the analysis that I did a

[00:51:44] CR: few months ago, my mind mapping the future, um, post, you know, I was saying that the first layer of jobs I see going will be the low risk, high value jobs. So, Coding. Okay. At the moment, you’ve got five coders working on a project and you’ve got a manager overseeing those or a head coder.

[00:52:03] SS: You only need

[00:52:04] CR: probably get rid of

[00:52:05] SS: Yeah, of course you can. Yes,

[00:52:06] SS: you can.

[00:52:06] CR: right? So those four aren’t going to have human facing jobs. Oh, well, you can go all talk to a client now. You don’t want a scruffy neckbeard coder talking to humans. That’s a terrible idea.

[00:52:20] SS: keep them away from humans. That’s really

[00:52:21] SS: funny. A

[00:52:23] CR: Customer service. You know, people that are answering phones and doing chat service, you know, and little text box service things, completely replaced with AI.

[00:52:34] CR: No, there’s no human facing, happy touch, double massage opportunities for them in this scenario. They’re just gone, gone. I don’t see them being, um, given something else to do inside of the business. Analysts? At the moment, big organization, you might have five, 10 analysts doing stuff or,

[00:52:56] SS: and financial institutions, insurers, all of

[00:52:59] SS: that. Yep,

[00:53:00] CR: cost estimators in construction companies and stuff like that. You might keep one out of five or one out of 10 and a manager initially, but the rest of it’s just going to be replaced with AI. You’ve got riders. Freelance writers, PR, journalism, whatever it is, um, gone, um, marketing writers, graphic design, industrial design.

[00:53:24] CR: I was talking to a young guy at Kung Fu the other day, he’s 19, 20, working in a factory or something, hates his job. I said, what do you want to do? And he, like, why don’t you go do something that you like? He goes, eh, I’m thinking about getting into drafting. I want to get into drafting. I said, uh, that’s interesting.

[00:53:42] CR: How many years do you think it’s going to be before an AI just does all of the drafting? And he said, uh, maybe two. I go, yeah, that’d be my guess too. Not much of a career really, is

[00:53:53] SS: Well, let’s go with that analyst

[00:53:55] CR: the time you learned to use a CAD tool.

[00:53:57] SS: You know, and I wonder if this is, because there could, there could be unexpected forks in the road. Often with technology, there’s just this really unexpected fork in the road. I foolishly believed that the internet would create more truth in society.

[00:54:11] SS: I really, really did. Like, I’m serious. I thought, wow, we can find things out now. We can go to the tapes figuratively and see what the truth is. And, and the way the

[00:54:22] CR: look it up.

[00:54:22] SS: evolved, here we are. Maybe a lot of these big organizations, and let’s take any organization that is big enough to have some type of analyst.

[00:54:32] SS: Whether it’s a fast moving consumer goods company like Procter Gamble, whether it’s Citibank, whether it’s an insurer. Lots of analysts in these big organizations. And even coding software companies, you know, rooms full of coders. Maybe we get an unexpected and new fragmentation, right? Where there is hundreds and thousands.

[00:54:58] SS: Of small people doing individual tasks in certain realms and areas. Ostensibly working with powerful AIs that they orchestrate and coordinate. And we enter this new era of the digital craftsperson, where we have access to massive open source forms of AI and robotics, where people can build, make, and create things, whether it’s physical goods like handbags or whatever with robots, or whether or not it’s someone who can somehow with powerful AIs, Build a banking system where you can get money off an open money market and have a banking system where your margins are enough for you to make 500 grand a year and you’re, you’re so skinny on the margins that everyone will go with the banking with you.

[00:55:43] SS: You, you, you build a micro bank, bank or something, or a micro insurer and we have All these individuals totally disrupting large corporations who used to aggregate all of this power. I don’t know. I mean, this is just a thought pattern that again, I’ve just made up on the spot. And, and that was like a little bit of the early internet dream.

[00:56:06] SS: Remember it was like, Anyone can make and do their own thing, become a little e commerce business. But we ended up with these power laws where things just aggregated. Um, as Doctorow said, you know, the internet became five giant websites with screenshots of the other four. So it’s like maybe this, this AI was the missing link because it was too complex to orchestrate the pieces of the puzzle in the supply chain, the finance, the data analytics, the advertising, the connecting the consumers.

[00:56:34] SS: And maybe AIs. Can be all put together so that we all become small business, digital crafts, people empowered by AI, totally demolishing big corporations because they can’t compete with us anymore because we have access to tools. That they have as well, but we have lower cost infrastructure and we don’t need as much margin because you’re only feeding us and our family.

[00:56:59] CR: we could call it the great fragmentation,

[00:57:01] SS: Look, just wait here because

[00:57:04] CR: that title.

[00:57:04] SS: that was kind of what I was thinking way back then in 2014 when I wrote that book, but it kind of didn’t turn out that way. I mean, a lot of the things that I had in there did turn out. I actually going to do a review of it. I’m going to do the 10 year review because it’s coming up to that.

[00:57:19] CR: Mm

[00:57:20] SS: Um, what I got right and what I got

[00:57:22] SS: wrong,

[00:57:24] CR: know, I, I have been saying for some time that I think that, you know, I see people talking about the role of AI in marketing and the way I hope it plays out is AI just eliminates marketing because. You know, right now, if somebody wants to, if I want somebody to discover one of my history podcasts, you know, they need to go, it needs to either be an ad that they see in Facebook or Spotify or Apple podcasts or something, or it’s word of mouth, or they need to go searching for funny history podcasts that talks about Rome and.

[00:58:01] CR: It has a lot of dick jokes in it, which is a pretty specific search term that I’m not sure a lot of people throw in. But, ostensibly, you know, uh, a few years from now, somebody will say to their AI tool on their Apple intelligence device, Hey, um, look, I want something new to listen to. And it will say, well, Steve, based on what I know about you, you have an interest in history.

[00:58:23] CR: You like dirty jokes. Um, you should check out, I’ve got this podcast for you that absolutely, I know you, is going to target your funny bone. You should check this out. Um,

[00:58:34] SS: which is what friends do, which is what friends do, because you want to have an understanding of each other that’s really deep and visceral and you, and you,

[00:58:41] SS: know what Cam will like. Yeah.

[00:58:45] CR: Um, and you can have the, the Etsy creator of, uh, uh, You know, like, I don’t know, some cool, uh, knife that they’re hand making. My friend Ian, who’s a boiler maker by profession, um, patent maker actually by profession. Um, he’s going to retire. He wants to make knives, have a little factory in his little property up in the Sunshine Coast and teach people how to hand make knives and stuff like that.

[00:59:14] CR: You’re going to have, you’re going to have like an Etsy thing where you have your handmade knives and The AI will find it for you and promote it to you. Hey, I’m looking for a really good custom knife. Oh, you should check this guy, this guy out. He’s doesn’t sell many. He doesn’t do any advertising, but he’s got great reviews.

[00:59:30] CR: Customer love his stuff. He runs a little course. You can go spend a weekend and learn how to make a knife and all that kind of stuff. It’ll cut through marketing and advertising by, it’ll know everything that exists on the net and it’ll be able to custom connect businesses with customers.

[00:59:47] SS: wonder how many businesses that we would love. To spend our money on, we just never really find because the game is so hard to get attention. And that’s why you’ve got these big tech companies. Yeah. And, and, and maybe a lot of those businesses could be thriving and not just be the 30 grand a year side hack.

[01:00:05] SS: That could be the 300 grand a year or the 500 grand a year. If you could connect with the right people. And humanoid robot that costs you 10, 000 in your garage doing Bits and pieces for you that you’re, again, the orchestrator of. It may well be that those businesses already exist, but the AI and the robotics is the missing ingredient or link to make those happen.

[01:00:27] SS: Reach more people and have the production capacity and organizational capacity to keep the finances, all the pieces of any business puzzle humming along. And that’s why, uh, it’s kind of almost goes back to Robert Coase and the theory of the firm and the theory of the firm. I think it was written in 1910 or 15 was why do organizations exist?

[01:00:50] SS: Because they create value through organized, organizing things that individuals just can’t do. But maybe AI. It makes us have to reconsider whether or not you need managers when those managers could be essentially AI bureaucrats who manage those pieces of the puzzle for you and give you a chance to

[01:01:11] SS: compete against the big, the firm.

[01:01:15] CR: Mmm. I like that. Well, before we wrap up and we’re running out of time, but I wanted to run through some of the other thoughts that I had when I was thinking through the UBI stuff, um, a few weeks ago, one of the, like I read, there’s, there’s a bunch of people that have been writing about this from Bill Gates through to Yanis Varoufakis through to Thomas Piketty and Andrew Yang.

[01:01:39] CR: I was, Scrolling through a lot of their ideas, and one of the things that I came up with that I thought was interesting was the idea of public sector jobs, like a return to the Works Progress Administration that FDR set up during the Great Depression in the US, where basically people who were unemployed just worked for the government, and they would go around and do Major projects like cleaning up the national parks or working on major building projects.

[01:02:05] CR: We’ve got a major housing crisis, as we know in Australia, the government go, okay, well, we’re just going to employ a hundred thousand, uh, people. Um, you’re all going to be taught how to build. Residential property. Um, we’re going to have some people who know what they’re doing come in and they’re going to just have work crews roaming the country, building residential property, just government jobs for everyone.

[01:02:30] CR: Um, beautiful communism where everyone just has a job for life, working for the state. Getting him to do whatever we need you to do. Where do we need, now, why wouldn’t you get robots to go build those things? Uh, well, maybe

[01:02:43] SS: Because the people need something to do, Cameron, is

[01:02:46] CR: to do,

[01:02:47] CR: exactly. Yeah. The government’s not run for profit. It’s going to be getting its money from somewhere. So if

[01:02:52] SS: I love this. You would be surprised as a raving capitalist at how much I love that. Like, I love, and I’ve always said that, that I think the best thing you could do if anyone wants their unemployed is after period X, whether it’s a year or whatever, and, and it might not even be full time, you might say, okay, you get unemployment benefits for six months, a year after that, you either need to be doing study to retrain in whatever you choose, or we will give you a job.

[01:03:25] SS: Right? And there’s plenty of things that need done, you know, whether it’s, you know, like say parks and gardens cleaning, like Singapore do a great job of it, you know, they’ve got bloody flowers in the middle of their highways, right?

[01:03:33] SS: It’s a, it’s a, it’s a beautiful place. And there’s,

[01:03:35] CR: What about handymen for elderly

[01:03:38] SS: exactly. It could even be, you

[01:03:40] CR: we’ve got, yeah, we’ve got guys that’ll go around and change

[01:03:43] CR: a light bulb for my mother. Who’s in the late seventies

[01:03:47] SS: Exactly.

[01:03:47] CR: you know, chop the. you know, chop

[01:03:49] CR: the branches off a tree so she’s not up a ladder

[01:03:51] CR: with a chainsaw.

[01:03:52] SS: So that, that I think would be a really great idea. And it’s not you work for your doll. You get more money, even more than the minimum wage. And if it is that we have monopoly companies and the prices don’t drop like I think they will in the economic flow, Uh, again, you just tax it really highly, and then the government takes on people to do the things that the robots can’t, or other things that robots could do, but people do them anyway.

[01:04:20] SS: Like, I really think that is a really strong proposition, is to redeploy people doing Large scale public infrastructure works, products, houses, services, parks and gardens, everything. I mean, there’s a nor walk around any suburb and you could write a list as long as your arms and legs on things that need done that would be better to make, you know, our society more livable.

[01:04:41] SS: A lot of it might even be, you know, recreation and sport and, you know, take, you know, kids soccer clubs that don’t exist or, you know, building facilities for sport or whatever it may be.

[01:04:53] CR: Teaching people

[01:04:54] SS: That’s another example, by the way. Robots will be better at soccer and football and every sport than humans will be as well, but I bet you we’ll still go and watch the rugby league or the NRL or the NBL basketball because humans are doing it.

[01:05:07] CR: I don’t even watch any of that shit now because I

[01:05:09] SS: Because you focus on world wrestling with Mr. McMahon.

[01:05:16] CR: No, I just go to Kung Fu and get beaten up. Oh, I did my Kung Fu grading last week. Chrissy and I had a Kung Fu grading

[01:05:22] SS: Did you get the black belt?

[01:05:23] CR: Got our Brown Belt. We got our Brown

[01:05:25] SS: you said you were going to send me some video too.

[01:05:29] CR: did

[01:05:29] SS: Yeah, you promised. You said at the grading, you’ll film it and you’ll send it to me.

[01:05:32] SS: Oh

[01:05:33] CR: Fox was supposed to film it, but he spent most of the time filming himself doing Pokemon Go in the kitchen. But one of the other guys there did film some stuff and he sent it to me. I got punched in the throat towards the end. I haven’t been able to talk for the last week. I got punched in the throat really badly, but, um, I’m recovered

[01:05:51] CR: today. Two one what?

[01:05:59] SS: Minutes.

[01:06:02] CR: Two one minutes what?

[01:06:06] CR: really? You’ve got a

[01:06:07] SS: Yeah. I had a hard stop at 2. 30, but that’s all right. We’ll go to three. I was

[01:06:10] CR: All right.

[01:06:11] SS: I was getting, look, Cameron, I was enjoying the podcast and I think I was

[01:06:15] SS: starting to improve my performance as we went. I actually made some better

[01:06:20] CR: You’re hanging on, you’re hanging

[01:06:22] SS: at one point, but I

[01:06:23] SS: think I made a really good comeback.

[01:06:25] SS: I actually made a really good comeback. The other one. So

[01:06:28] CR: me quickly run through

[01:06:29] SS: to government, I love.

[01:06:30] CR: of the key,

[01:06:30] SS: That’s a tick from me.

[01:06:32] CR: some of the key. I want to run through some of the key thinkers and what their ideas are on this. Andrew Yang, who ran, I think, in the last presidential election, he advocates for a UBI funded by a value added tax on tech companies. A guy called Darren Ashamoglu warns about the unchecked Bread of automation and calls for policy focusing on job creation that complements human labor.

[01:06:55] CR: Guy called Eric Brynjolfsson supports progressive taxation, worker retraining, and lifelong learning to address automation driven inequality. Thomas Piketty, who wrote a great book on capitalism. He’s a French scholar about five or so years ago. He pushes for wealth taxes to combat rising inequality due to automation.

[01:07:12] CR: Yanis Varoufakis, who is I think the Economy minister of um, uh, Greece for a while there, he’s a big advocate for public ownership of AI and automation distributing the profits from these technologies. As A UBI, bill Gates is proposing a robot tax to fund social programs for displaced workers. Guy called Martin Ford warns about the scale of job loss and supports UBI as a solution, David or.

[01:07:41] CR: focuses on complementary jobs and the need for vocational training to fill roles that AI can’t replace. And Mariana Mazzucato calls for governments to shape markets through public ownership and investment in innovation. Those were the sort of eight or nine key thinkers whose stuff I’ve been reading through.

[01:08:03] SS: And, and they’re all,

[01:08:04] CR: ideas, but the, well, that’s

[01:08:06] SS: they’re all good. And, and they’re actually all the same thing. They redistribute wealth, some form

[01:08:11] SS: of tax. They’re all the same thing, aren’t they? Except

[01:08:14] SS: for Mariana

[01:08:15] CR: what a UBI is. It’s a redistribution,

[01:08:17] SS: I like hers, which is

[01:08:18] CR: retraining and redistribution of

[01:08:20] SS: Retraining, redistribution.

[01:08:22] CR: the thing is, we need to be having conversation about this now as a society. Government, I mean, we’ve got an election coming up here in Queensland this weekend. I don’t hear anyone talking about how the fuck are we going to prepare our society for AI.

[01:08:36] CR: It’s not really being talked about in the US presidential election, outside of being a throwaway. It’s all more about, you know, stopping

[01:08:44] SS: Well, you know, no, you know why that is. And it’s the same as in your election is because people are worried about their grocery prices and their interest rates and if they can

[01:08:53] SS: buy a house. And if you start

[01:08:54] SS: talking about this, you just get lost because people are worried about

[01:08:58] CR: I know.

[01:08:58] SS: It’s you and

[01:08:59] CR: are we going to talk about it?

[01:09:01] SS: and I and, and, and a small cohort who are thinking about these bigger things.

[01:09:05] SS: And we’re fortunate enough to have the time and energy and

[01:09:08] SS: capacity to do it. But most people are thinking about making their bills this

[01:09:12] CR: I’m not worried about the people. What, where are the, what are the governments? Where are the governments working

[01:09:17] SS: okay, so the

[01:09:18] CR: Where’s the,

[01:09:18] SS: while they’re not

[01:09:19] CR: where’s the COVID emergency plan that

[01:09:21] CR: we have for this, Steve? Like, where are we pulling together the greatest minds? When are you and I getting called into a room in Canberra to say, Hey, listen,

[01:09:29] CR: we, we, we need help.

[01:09:31] CR: Steve and Cam, Futuristic, come and help us

[01:09:33] SS: well, you know, I, I did get called by the federal police on the future of terrorism, but that’s, that’s, that’s another story, uh, for, for another podcast,

[01:09:41] CR: Were they talking about me?

[01:09:42] SS: hey? Well, I think they’ve found out that I hang out with you, and they’re very, very worried.

[01:09:50] SS: But they’re, they’re,

[01:09:51] CR: a socialist with crazy wizard hair.

[01:09:53] SS: yeah, but I, I really like the idea of governments shaping markets and taking action.

[01:09:59] SS: I think governments should take back all of the utilities. I think they all should be government owned. I don’t think any public utilities and natural monopolies should be privatized. They also give us the ability to employ people. They create natural monopolies where you can have money flows with it.

[01:10:13] SS: And they also give the government the potential to raise and reduce prices based on economic pressures. Um, yeah. And, and I don’t think anyone’s going to talk about this anytime soon because the threat is internal and not immediate.

[01:10:30] CR: Well, that’s the Futuristic for this week, maybe this month, uh, depending on what happens. We had a lot of other things we could have talked about, but we ran out of time. Uh, thank you. It was good fun to talk to you as always, my friend. I love, you make me think, you challenge my thinking. I appreciate that about

[01:10:46] SS: well, you, you even stuck it out when in the first instance I was struggling, but I felt like I hadn’t okayed back half. I think you still won the match, but I think it was a close game in the end.

[01:11:01] CR: Have a good week, buddy. Take care,

[01:11:03] SS: See you, mate. Bye.