
Just own the damn robots - npalli
http://thereformedbroker.com/2017/10/16/just-own-the-damn-robots/
======
Waterluvian
Reads like this are slowly convincing me not to buy into the world of
mortgages and debt and to just live the rest of my life paying for everything
in cash. I tried to buy a house last year with my wife but the market exploded
where I live and suddenly houses were 40% more expensive from last year.

So we still rent, which makes me feel incomplete. Like I'm kind of failing my
duty of bringing the Canadian Dream to my family. But I gotta tell you, seeing
45% of my before tax income going into savings feels amazingly liberating. I
stopped calling my savings a "down payment". It's now, "two college funds and
3 years of unemployment."

I feel in total control of my future this way, but I also feel like I'm
feeding into the apocalypse paranoia. I won't actually need this unemployment
cash will I?

~~~
hectorlorenzo
Slightly off-topic, but that is the main reason I do not want to have kids: I
am not sure I would like the kind of person I would become.

Sometimes I am already paralysed by fear when thoughts about my future take a
dark turn (relatively often), but at the end of the day it is my well-being
(and my wife's) we are talking about, and we are economically independent
adults. We could take a hit or two.

Throwing little defenceless creatures in the mix? Oh gosh...

~~~
bamboozled
This seems to be a pretty common attitude amongst a lot of people in their
late twenties and early thirties I socialise with (who should probably be well
into parenthood).

Common question seems to be, "Why bring a child into a world facing climate
change, potential nuclear war and a lack of prosperity or opportunities for
personal growth".

Adopting is probably a better option ;)

~~~
schof
I fully reject that "Why bring a child into this world facing..." argument.
(And I'm going to skip the fact that this is probably the best time in the
history of the world to be born.) Sure there are big problems in the world. My
son may help FIX some of those problems.

And if not, he may end up being the mayor of Bartertown.

~~~
bamboozled
Ok, interested in hearing your views?

------
matthewbauer
Interesting article but I think the premise that workers are buying tech
stocks because they fear automation is incorrect. Gallup found 13% of
Americans thought that their jobs would soon be replaced by automation[1]. In
fact you usually find more people worried about immigration than
automation[2]. Maybe people /should/ be more concerned about automation but
they just aren’t right now.

[1]: [http://news.gallup.com/poll/216116/few-workers-worry-tech-
ma...](http://news.gallup.com/poll/216116/few-workers-worry-tech-making-job-
obsolete.aspx)

[2]:
[http://news.gallup.com/poll/1660/immigration.aspx](http://news.gallup.com/poll/1660/immigration.aspx)

~~~
aerodeck
The article mixes its message a bit between automation/disruption/capital. One
couldn't really say that Uber is in the business of automation. The
capital/labor distinction is more productive, but since it is derived from
marxism no one actually uses it.

I'm starting to get the impression that this genre of "technology gone bad"
article is starting to be a safe surrogate for talking about class. The
muddling of terms is actually a feature: one can avoid the dirty reality of
class by framing it as an inherent feature of technological progress, which,
of course, is a good in-and-of-itself (unless you're a dirty commie).

I think the same is true of immigration: low class people blame their poor
condition on immigrants, rather than their class standing.

~~~
stoolpigeon
Actually here on this site is where I've read many times that automation is
Uber's destination and that when they get there they will truly have attained
their goal.

------
sulam
This “theory” for equities growth is a joke. There is a very simple reason for
it and plenty of non-tech baskets show the same 2 yr (or longer) pattern.

Simply put, cash and cash equivalents are generating historically low returns.
So you put your money in equity.

(And if you are a retiree you put it in stocks with dividends. Look at the
growth in dividend-generating stocks like energy, mining and metals and it
makes FANG look shitty. This is fixed income portfolios trying to achieve
their needed goals.)

Ironically, it’s GDP growth that will stop the music, because enough of that
will generate inflation and make it rational to hold something besides US
treasuries. In fact it’s already starting to happen for non-US markets
(although slower than all the hedge fund smarties thought, therefore the
complete bath they’ve taken the last year).

The length of our equities boom is inversely correlated with GDP growth. This
cycle is (much) longer than the historical average simply because real growth
has been so low. Normalize against aggregate growth over a cycle and we have a
year or two left in the current one (assuming job, GDP, wages etc continue to
be anemic - if they pick up rapidly things will rapidly shift).

~~~
roymurdock
> we have a year or two left in the current [cycle]

Are you saying that we have a year or two until we see a pick up in
productivity (driving real growth and GDP), which will shift investment out of
equities and into? Cash and cash equivalents?

Or are you saying that we have a year or two until we see a recession (decline
in GNP), triggered by a flight from the equity markets?

~~~
sulam
I'm making a (perhaps reflexive) statement about economic cycles, that they
are effectively defined as a period of growth followed by a shock. Without
growth, there is no shock. Our current cycle has been characterized by very
low growth. It is also much longer than typical, but I think this simply
follows from the fact that we haven't had a lot of growth. Growth seems to be
picking up, though, and I think over the entire period of the cycle will soon
be "enough" to trigger the next cycle.

------
mooreds
Whoa. No solutions, at the end, but what a story.

As someone in a situation similar to the 45 year old he mentions, I worry
about being displaced. Not every day, but every month or so I wonder.

What a fascinating thesis. I wonder what happens when the 'replacement fear'
buy collides with the 'boomer retirement' sell?

~~~
pdog
Pretty sure the proposed solution is to buy stocks of the U.S. technology
giants: Amazon, Apple, Facebook, Microsoft, and Alphabet, the parent company
of Google.

~~~
adventured
The largest market cap companies in a given decade, overwhelmingly tend to be
under-performers in the following decade. It's a trend that has repeated
decade after decade. Many of these types of companies - AMZN, NFLX, GOOGL, FB
- have pulled a massive share of their future returns forward (which is what
happened to Microsoft, stagnating its stock for ~15 years).

In 2007 the largest companies were: Exxon, GE, Microsoft, PetroChina, Royal
Dutch Shell, Citigroup, AT&T, Gazprom, BP, Toyota, Bank of America, China
Mobile, HSBC, ICBC, Walmart. All have performed at a mediocre level at best
over that time. See:

[https://www.bloomberg.com/news/articles/2017-09-11/apple-
vau...](https://www.bloomberg.com/news/articles/2017-09-11/apple-vaults-to-
no-1-from-no-70-after-a-decade-of-iphone-sales)

Is Amazon going to grow into a $2 trillion market cap over the next ten years?
No, there is zero possibility of that happening. It'll be very lucky to grow
into its existing market cap today, over that ten years. Keep in mind, they
have $100 billion in retail sales, generating Walmart style margins on that
business; Walmart has ~$450 billion in retail sales, generating ~$15 billion
in net income. For that, Walmart gets to trade at half the market cap of
Amazon. That's Amazon's future value compression. That multiple erosion won't
occur until the market starts to realize the AWS growth machine isn't going to
last forever (AWS representing a very large portion of the Amazon stock
appreciation the last three years), as that growth curve slows in the next few
years, the market will push down on Amazon's present extreme premium.

Netflix has a ~200 PE ratio, there is no means for it to ever justify its
existing valuation (400 million global subscribers? no chance), much less a
far higher one. Their present business model has never proven the ability to
produce good margins, content has perpetually sapped their earnings potential
and is likely to continue to do so.

Facebook and Google will stagnate and grow into their valuations. Google
particularly is trading far beyond where it should versus its now modest
growth rate. ~37 times earnings, $700 billion market cap, for 10%-15% annual
growth over the next five years? No thanks. In the not very distant future,
Google will pull a Microsoft and begin paying out a dividend, after this
latest stock market bubble ends and their stock returns drift to mediocrity.

~~~
paulpauper
_Netflix has a ~200 PE ratio, there is no means for it to ever justify its
existing valuation (400 million global subscribers? no chance), much less a
far higher one. Their present business model has never proven the ability to
produce good margins, content has perpetually sapped their earnings potential
and is likely to continue to do so._

 _Facebook and Google will stagnate and grow into their valuations. Google
particularly is trading far beyond where it should versus its now modest
growth rate. ~37 times earnings, $700 billion market cap, for 10%-15% annual
growth over the next five years? No thanks. In the not very distant future,
Google will pull a Microsoft and begin paying out a dividend, after this
latest stock market bubble ends and their stock returns drift to mediocrity._

People said that three, five, ten years ago. What is happening is that the
market for mobile and desktop ads and e-commerce is growing, combined with
increased market share for these three companies, creating a double tailwind.
I'm certain Google, Amazon and Facebook will not suffer the fates of Exxon,
GE, PetroChina, Royal Dutch Shell, Citigroup, AT&T, Gazprom, BP, Toyota, Bank
of America, China Mobile, HSBC, ICBC, and Walmart. Part of the reason Amazon,
Google, and Facebook will be permanently successful and are so resilient is
because they have market dominance, impassable moats, ubiquity, and are mostly
immune to global macro conditions, whereas commodity and banking companies are
much more vulnerable to macro conditions. It's much easier to create a steel,
drilling, or mining company (look at all the overnight fracking companies that
went bust in 2015-2016) than it is to, say, get 1/6 of the world population on
your social network (Facebook), every website and phone displaying your ads
(Google), or every consumer buying from your store (Amazon) (and also the
cloud hosting services). [http://greyenlightenment.com/will-the-silicon-
valley-tech-fo...](http://greyenlightenment.com/will-the-silicon-valley-tech-
fortunes-dissolve-like-the-rockefeller-carnegie-and-vanderbilt-fortunes-no/)

But also, some of those companies you listed pay huge dividends, so when you
factor those into the returns, it's not stagnant.

~~~
kmicklas
> will be permanently successful

Surely you don't mean actually permanent. So what time scale do you think they
will last?

~~~
tibbetts
One reasonable perspective is they will be successful until there is a market
correction so large it can't be hedged against. World War Three, global
warming societal collapse, popular revolution, or massive antitrust activity.

As they say, "in the long run we are all dead."

------
arca_vorago
Have fun trying to own the robots after we've allowed proprietary licenses and
leasing to takeover anything with a CPU attached.

Ownership is important, which is why copyleft is important, and its time to
recognize how integral the four freedoms are to the future I think most of us
want.

~~~
Digit-Al
He wasn't talking about actually, physically, owning the robots. He was
talking about owning stocks in the companies that make the robots. So that as
they get wealthier, so do you.

~~~
pygy_
Until the robots decide to stop feeding their "owners".

Money is a social construct. Power comes from controlling energetic resources,
and automation is gradually stripping that control away from humans.

------
aorloff
15 years ago all the software jobs I worked at were retiring clerical workers
with software (oh you have 15 people doing spreadsheets ? We can automate that
and you won't need them for the same report generation).

So this has been going on a lot longer than the article supposes. Yes its true
that the sophistication of the automation, and the breadth of its reach (with
robots / gig economy) is higher than before, so it will affect more jobs, but
it will also create new jobs managing the automation (the same way people
found jobs using Excel to manage those spreadsheets from previously more
manual ways to do reporting).

In other words, this is the normal destructive (and positive) cycle of
capitalism. It is always painful for people who adapt slowly, and provides
opportunities for those willing and able to jump into the development and use
of new automation tools.

~~~
Iv
> but it will also create new jobs managing the automation

No, that's bullshit. New jobs will be created that way but far less: there
would be no incentive to automation otherwise. This month I visited a
warehouse with a team tasked to automate it. If we succeed, phase I should put
~10 people out of job and we don't expect to have to do more than occasional
monthly interventions (and that's assuming that we have a high failure rate).

The thing that is different in this cycle is that we may very well manage to
100% automate some industries. At this point, there will be a genuine
question: why do we need to work to benefit from the goods of these
industries?

At the core of the pact that makes our society is the idea of specialization:
we have varied needs that we ask specialists to fill (farmers, car makers,
fridge makers, power plant workers, etc...) while we, too, fill one small
niche. The less people work we need to fulfill our daily needs, the less work
we should be asked daily.

But this transition will only happen if we are conscious that it is possible
and desirable.

~~~
aorloff
> At this point, there will be a genuine question: why do we need to work to
> benefit from the goods of these industries?

For the same reason you can't look over to your neighbor's driveway and say,
since he doesn't use his truck all day while he's at work, why can't I drive
it ?

The people who built those automated industries expended capital, and likely,
borrowed against future revenue to do so.

What you are free to do is compete with them. You can drive them into their
stupid lender's hands by forcing a collapsing of margins in the industry using
your wits.

But nationalizing the factories has, historically, generally led to nasty (the
opposite of what your conscious advocates would call desirable) outcomes. And
you are saying that a 100% automated factory should be effectively
nationalized.

~~~
knodi123
> The people who built those automated industries expended capital, and
> likely, borrowed against future revenue to do so.

> What you are free to do is compete with them. You can drive them into their
> stupid lender's hands by forcing a collapsing of margins in the industry
> using your wits.

So the solution for the hordes of people who were put out of work by
automation, is to gamble it all on the bet that they can outcompete powerful,
established businesses by operating with far less profit?

Are you really saying "I'm sorry you lost your factory job, but the only moral
solutions are a.) let your family starve to death, or b.) every unemployed
factory worked just, sorta, _becomes_ an entrepreneur, scrapping with all his
former coworkers and bosses over who can survive on the slimmest margins." ?

Nationalizing factories may lead to undesirable outcomes, but your alternative
is a different kind of dystopia.

~~~
aorloff
I'm not suggesting that literally, I'm saying that's what the overall system
does. Someone will gamble their time on beating powerful established
businesses, and they will figure out some efficiency to win by.

Some of the factory workers will find other work, some in other industries, or
other businesses in the same industry.

But when you are suggesting policy, you think about the overall system, not
just the poor factory workers. The overall system works, even if labor isn't
part of production due to automation, because labor builds, maintains, and
services the automation. Sometimes there's some debugging involved too.

Yes some workers will lose their jobs because they don't have marketable
skills any more. That's why we invest in education. Maybe not terribly wisely,
but that's the idea.

~~~
logfromblammo
But eventually, you will run up against something never before experienced in
human history--exhaustion of demand.

The problem with automation is that the robots don't _want_ anything, and all
they _need_ is power and maintenance (that is much easier to perform than
medical care).

They can supply goods and some services so much more efficiently than human
labor that no human can effectively compete with them and still be able to
eat. So the humans that formerly did their jobs have nothing to trade at
market. They are forced to subsistence labor, if they are even allowed to do
that. You can't afford the electric induction cooktop or the electricity
produced by robots, so you have to burn scavenged wood in a hand-built rocket
stove. The displaced laborer contributes no more demand to the robot-supplied
marketplace.

Each worker you make obsolete removes their demand. The robots produce less,
consuming only their most basic needs, and send most of the output to their
owners. The owner class, who does not consume 100% the maximum output of their
robots, slowly buys up all valuable resources with the excess, as those who
wish to avoid subsistence lifestyles sell off their assets in order to stave
off scavenging for roots, mushrooms, and squirrels. Perhaps some of them can
manage a parallel economy trading in inferior goods and services, but the
threat always looms that anyone too productive will be able to buy in to the
robot-owner class and stop supplying the under-economy. Most everyone becomes
Spam. They only trade with each other until they can be steak again. So
everything in the under-economy sucks.

One laborer can maintain hundreds of robots, who can each support a specific
want of millions of people, but only have thousands of owners. The owners
don't _want_ more than the robots can provide, so those humans that don't own
can't manage to sell much of anything to the owners, except things that robots
_cannot_ provide [yet]: art, love, babies, etc.

Every unemployed-becomes-entrepreneur is a last-gasp effort to leap the
widening gap between the haves and have-nots, like a salmon shooting past the
open jaws of a grizzly. If you don't buy in soon, you might not have anything
left worth trading for your golden ticket.

------
Terr_
> In this context, the FANG stocks are not a gimmick or a fad, they’re a f---
> ing life raft.

Note that if you are employed in one of those companies, you should think
twice how you'd want to invest in them, because you're actually putting a
bunch of your eggs in one basket.

I keep remembering those poor Enron employees whose retirement funds were
mainly in stock of Enron itself, so that they were both unemployed _and_
financially ruined when the scam fell apart.

~~~
suls
This. Just a bit of portfolio theory would make it very clear this isn’t a
good idea ..

.. yet I have to defend myself every odd month as to why I am not
participating in the employee stock ownership program.

~~~
lostboys67
Depends on program in the uk share save schemes are an obvious no brainer
investment you literally cant lose more than the difference between inflation
and the guaranteed return if the stocks are under water at exercise time

~~~
alien_at_work
There is more to consider than that. How much money is being tied up for
participation, what is your average expected return for that amount, how does
that compare to just picking an index, etc.

------
arichard123
I just don't buy it. I understand I'm in a minority, so let me indulge myself
and explain, for a moment, why I think AI / Robots are nothing to worry about.

My claim is: Robots will not replace humans in all jobs. Further, it's more
than because of Human preference, I think that Robots will lack cognitive
abilities that we have.

My expectation is that in each area where they are deficient then they may
well become a tool for a Human overseer, and that might replace some workers.

I don't believe AI will effectively deal with:

1) Cultural concerns. e.g. Appropriate imagery in advertising.

2) Major strategic considerations when faced with an uncertain future.
(Physical war, trade war, geopolitical events, natural disasters).

3) Legal frameworks, as they are not well defined.

4) Human relationships. e.g. Don't make Alice and Bob work together.

5) Intuitive leaps. e.g. Rubics cube.

6) Empathy.

The reason I believe this is not because I believe in a soul, or anything
mystical, but because I believe that the nature of our brains, our senses, our
learning experiences, and the evolutionary processes that got us here can not
be matched by our technology.

I think this means Robots / AI will not independently create new businesses,
new products, build factories, kit out factories, buy other robots, produce
marketing, deal with customer services, returns, courts, investors,
regulators, suppliers and so on.

I can imagine products that will exist forever, like, rope, or cutlery, or
plates, and someone automating a factory to produce these commodities. But
they will still use humans to manage product development, supplier and
customer relations, advertising and security, and, probably, looking after the
robots.

I think that Robots / AI will at best become a tool for people to use, but the
power will remain with Human employees.

~~~
michaelbuckbee
It was some article here on HN a while back that framed this much better for
me.

It's NOT that Robots are going to take all the jobs, it's that automation and
productivity advances are going to reduce the people necessary by a drastic
degree.

There's lots of stats like Ikea factories making 17x the bookcases they did in
1985 but with the same number of staff. But even in our technical and
development niche, look at something like Instagram. They went from idea to
billions of users with what a decade ago would have been a laughably small
staff.

The future is the top 10% of staff executing with an army of automated
services at their command to do the work that 90% of their colleagues used to
do.

~~~
mooreds
Some might say it's a "Brave New World"

:)

The real question is what happens to the 90%.

~~~
CobrastanJorji
The best outcome is the "Culture" endpoint: a post-need society. 10% of people
are called upon to work, and the rest thrive on basic income and become
artists and inventors, philosophers and musicians and actors.

The worst outcome, on the other hand, is rather more dystopian. A society with
a very large percentage of young, unemployed people with no particular path to
success is not a stable society.

I suppose it matters how comfortable the 90% is when they become unemployed.
Is basic income enough to fulfill individual passions and interests? What
happens to a large body of humans whose needs are taken care of but who aren't
strictly needed for anything?

~~~
germinalphrase
Also, do the 10% believe that they are a static group deserving of persistent
participation in the "working class" \- or is this a competitive and fluid
group in which the children of the 90% may move into/out of as their
skills/ability apply? Which is to ask - is it worth maintaining a 90% at all
or should we 'solve that problem'?

~~~
lsiebert
I think you are assuming equal opportunity for the children of the wealthy vs
the children of the poor. It doesn't take any particular smarts to live off of
family money though. Investment income doesn't require work to support
oneself, properly diversified it will continue to grow. Income from jobs
however, does require work.

Study after study indicates that wealth provides opportunities, and that most
people don't move up to become wealthy but are born that way. So basically
society systematically advantages people who have wealthy parents, over people
who work hard.

Bill Gates father was relatively wealthy. Imagine how many bill gates there
are who are poor.

If Elon Musk hadn't had his father's money for his first company, there might
not be a paypal or tesla.

So the question is how many potential bill gates and elon musks are there
who's parents couldn't risk supporting them, who settle for doing something
less innovative and interesting because they need to pay the bills or support
family members?

~~~
fastball
But where did the wealthy parents come from?

You're setting up a chicken and egg problem for yourself. Wealth had to start
somewhere, as I doubt you'd argue that it was handed down to certain families
by a deity.

Heritage is important. A person does not just have more opportunity because of
the wealth of an ancestor - they _exist_ because of that ancestor. Does
everyone not deserve to have whatever their ancestors chose to give them?

The only argument that can be made is if you can show that someone's ancestors
only had wealth because they unjustly stole it from others. But that's a tall
order.

~~~
richardknop
If you go down the history, most wealth was stolen from people violently and
from then on anybody born into these aristocratic families would continue
benefiting from the wealth.

A lot of new wealth has been created by people born into poor / middle class
families in last 1-2 centuries for sure, especially 20th century.

But there are still families today that are wealthy and their wealth have been
with them for 400-500 or more years. And in those cases it's very likely the
original wealth was stolen.

It could be that original wealth was gathered during robber baron times by
exploiting workers or it could be even older, being passed from generation to
generation since medieval times. Which means the original aristocracy probably
gained this wealth in a violent conquest.

~~~
fastball
Right. "Probably", "maybe".

I don't think it's society's responsibility to look back further than the
formation of that society. For the US, I think you can safely use 1776 as a
starting point. The US formed itself with the express purpose of creating
equality for the original settlers.

If someone is violating those principles, society should punish accordingly.
If not, society is not "rewarding wealth". They are allowing for the fact that
everyone is someone else's child, and that comes with it certain rights.

~~~
logfromblammo
Prior to industrialization, "pull your own bootstraps" fortunes were extremely
rare, and largely a matter of accidentally being in the right place at the
right time. Most wealthy folks got there from skimming off their human herd by
force or threat of force and by bribing the most docile and cooperative by
giving them some of their own production back.

After industrialization, a lot of people were able to leverage first-mover
advantages and unrealized frontier opportunities into vast fortunes. But even
then, having one extra dollar from daddy in 1790 meant having many, many more
to give your own kids by 1820, even if you had 12 of them. That extra dollar
might have meant you carried a full feedbag and got there a day before the guy
who had to stop to let his horse forage, and getting there first was worth
thousands.

Now, daddy's dollars might allow you to start from second place, and grow
faster than the first-mover, who might be trying to bootstrap. Or you could do
the same with investor money, but with corresponding loss of equity. If mommy
or daddy fund you, you probably get to keep more of your own company.

~~~
fastball
What exactly is the problem with this?

~~~
lsiebert
Well personally, I'd like to incentivize those who put work and value into the
system over those whose individual contribution is negligible.

As well the marginal utility of another dollar to someone who is already
wealthy is low and they are less likely to use that money, whereas someone who
is poor or middle class not only benefits more from another dollar, but is
much more likely to spend that money in a way that stimulates the economy.

------
btilly
A correction to the history of retirement schemes.

Retirement schemes go back a lot farther than acknowledged in that article.
The most popular to have lots of children in the hopes that one would take
care of parents in their old age. But then you having things like the
[https://en.wikipedia.org/wiki/Tontine](https://en.wikipedia.org/wiki/Tontine).

~~~
pgeorgi
Sure, but Tontines didn't originate in the US (or at least the UK) and
therefore there's no need for the author to consider them part of world
history.

~~~
btilly
They didn't originate in the US, but they were popular in the US long before
the invention of pension funds.

------
anigbrowl
Why not just seize the means of production? Private (real) property is
ultimately rooted in the theft of the commons. This has historically been
justified using two assertions: that people don't value what they don't own,
and that nobody does anything except for profit. Both are highly questionable,
yet when counterexamples are offered they are generally dismissed as 'the
exception that proves the rule' or some equally irrational rhetoric.

Our existing economic paradigms are demonstrably flawed. Just as feudalism
tried to restrain the creative forces of capitalism but eventually collapsed,
capitalism is arguably restraining the creative forces of (socialism,
participativism, something we haven't got a good name for yet). We are
familiar with many of the potential pitfalls - excessive bureaucracy and
various flavors of authoritarianism - but have yet to fully systematize the
desirable alternatives of open source culture. Perhaps what is needed is a
general theory of economic networking that incorporates lateral as well as
hierarchical structures.

~~~
richk449
> Why not just seize the means of production?

I wonder if anyone has tried that before. I guess I will go read a history
book and find out.

~~~
PhasmaFelis
It's depressing how many people aren't interested in understanding how and why
communism failed, and what we can learn from that. The conclusion is always
just "capitalism and communism are the only two systems that exist; communism
didn't work; therefore capitalism is the best and only way to run things."

~~~
explainplease
I think it's helpful to look at it in terms of control vs. freedom. Communism
means more state control of people, capitalism means less.

In these terms, what if capitalism is simply the natural outcome of _x_ amount
of freedom? Therefore, shifting away from capitalism means shifting toward
either anarchy or communism (even if both of those options are far away in
absolute distances).

This makes it hard to discuss things calmly and rationally, of course: Few
people want actual anarchy, and few people want actual communism, but a move
in either direction is a move toward one of them, even if it's not intended to
go all the way. And if you do move one way or the other, some of those few
people who do want to go all the way will try to capitalize (ha) on the
opportunity.

Incidentally, this may be an argument for leaning more toward capitalism, i.e.
toward less state control: because people as a whole will never agree on a
single course of action, and because there will always be those among us who
want to achieve more power and wealth for themselves at others' expense,
leaning toward less state control reduces the potential damage and
power/wealth accumulation that "rogue" actors can achieve.

Or, to put that another way, it reveals an inherent weakness of leaning toward
more state control: that power corrupts, and humans desire power, therefore
using the force of law to concentrate power in the hands of fewer people
(ultimately backed by the use of force, as all government power is) results in
more corruption, and therefore results in more suffering for those not in
power. Capitalism certainly causes suffering as well, as the robber barons
demonstrated many years ago, but at least that suffering is not enforced by
the state--it merely arises opportunistically, and each instance is temporary
and localized, not permanent and universal.

Of course, globalism greatly increases the scale of that localization, which
demonstrates that theories about economics, government, etc. must be revised
and kept current with the times. Our governments and economies are largely
built upon ideas whose foundations were laid centuries ago, before any of
today's technologies could have even been conceived of. For example, the
American Founders could not have foreseen the kinds of rapidly changing,
global corporations that exist today, and so we should expect their ideas to
have some vulnerabilities which may be exploited by newer technology (to think
in infosec terms).

Anyway, if you are wanting to move away from capitalism and not toward
anarchy, you necessarily are moving toward less freedom and more state
control. I think the important point to note is that state control of economic
means cannot be isolated from other facets of life. It necessarily influences
all other parts of life, for the economy is that from which human sustenance
flows.

To look at it another way, capitalism allows for greed, which has very
negative effects--but it also accounts for greed, which is part of human
nature, and which motivates. Specifically, it accounts for it by allowing
everyone to be motivated by it. In contrast, giving the state more control
concentrates the greed in fewer people, by law. And I think it's better to
allow the evil of greed to be evenly distributed (which does not guarantee the
even distribution of wealth, health, or happiness, but allows it to be
pursued), than to use the force of law to concentrate it in fewer people,
expecting them to rein it in for the sake of the greater good, because that
fails to account for human nature--it's essentially a GIGO system.

Food for thought. :)

~~~
aluhut
As someone who comes from a soviet block country, I wanted to thank you. You
described it pretty good on the meta level. I may come back and copy it in
future ;)

It's far more then the mysterious criticism above deserved as an answer and
the "criticism" of this comment goes the same way. There is a certain fear in
left Utopism from the realization of what you've described. That fear is being
drowned in endless derivations of what already failed in hope to cloud the
meta problem.

To me, it's a wasted effort. This energy all those bright young people invest
there could be directed towards coming up with something really new or at
least making what we have more social. I hope they'll get there one day.

~~~
explainplease
Thank you for sharing that. I wish more people like yourself, who have first-
hand experience, would speak out. As you noted, the rhetorical techniques they
use are not in good faith. We need more actual witnesses to testify against
it, because such personal testimony is less susceptible to the deceptive,
distracting non-arguments they use.

> To me, it's a wasted effort. This energy all those bright young people
> invest there could be directed towards coming up with something really new
> or at least making what we have more social. I hope they'll get there one
> day.

Indeed. This seems to be the troubling outcome of their long-term efforts in
academia. It often seems like humanity is doomed to repeat the horrors of
history, not only because our memories are so fragile, but because there are
always a few dedicated to systematically erasing them. What a tragic waste of
human resources. We could stand on the shoulders of giants, but instead we are
pulled back into the crab bucket.

Keep fighting the good fight, my friend. :)

~~~
anigbrowl
_As you noted, the rhetorical techniques they use are not in good faith._

Wow, project much? I don't see that argument made in his comments, nor is it
evidenced in the comments of others. Considering that I drew attention to the
authoritarian pitfalls of communism and their destruction of 'life, liberty
and dignity' _before_ you joined the thread, your complaints about systematic
erasure are baseless. Perhaps you didn't bother reading the comments you were
replying to; I hope not, since the alternative possibility is that you were
engaged in deliberate mischaracterization.

~~~
explainplease
I wasn't referring to you, because I wasn't even thinking about your comments.

------
no_wizard
Like all things this well written on this topic I feel like it hits the nail
on the head and misses a few things because it’s an article by necessity must
paint in broad strucks so let me say this:

It’s completely right that automation/ robotics will accelerate the
displacement of workers and cause upheaval. Certainly owning the productive
fruits of this will make one very rich.

What won’t happen is that these will displace those who service unmapped or
poorly systemic mapped things. For instance: in the last 15 years there have
been techniques to attempt to automatically curate wine. Most either fail or
pivot. Why? Because chemical composition is only ine facet in the high end.
Remarkably software still does not do a great job here as tastes are subtle
and hard to train in a model or algorithm. It so far can only get n times
better than average but never tops an expert human curator in the high end.
Will it some day? Maybe. On an infinite time scale yes it will but I wouldn’t
quite go dumping my high end wine skills quite yet.

Which brings me to my point: automation is great for irredeemable or trainable
repetitive processes but still an infant at more complex things like the
example given.

In turn, if you can carve out a niche that is unusually hard to model and
train you may be okay. Unfortunately that’s not 90 percent of jobs I reckon.

The other sure fire bet us to only deal in Veblen goods. The value there being
exclusivity, which I reckon will never stop being a thing

~~~
intended
There an article somewhere which breaks down the types of automation, into a
useable manner.

Theres automation of tasks which free up labor to do MORE work - so if you
were a bricklayer, and were bottlenecked by number of hands, the wheelbarrow
would be a force multiplier.

Theres removal of jobs with less useful jobs, so the chef got replaced by the
burger flipper (not really, but I can't think of a good example at the
moment).

And finally removal of jobs entirely, with no need of replacement.

~~~
Qwertious
>And finally removal of jobs entirely, with no need of replacement.

For example, computers - who were replaced by computers.

[https://en.wikipedia.org/wiki/Human_computer](https://en.wikipedia.org/wiki/Human_computer)

------
paulpauper
_In Kurt Vonnegut’s 1952 novel, Player Piano, we are introduced to a future in
which only engineers and managers have gainful employment and meaningful
lives. If you’re not one of the engineers and managers, then you’re in the
army of nameless people fixing roads and bridges. You live in Homestead, far
from the machines that do everything, and are treated throughout your life
like a helpless baby. The world no longer has a use for you. Anything you can
do a machine can do better, and you are reminded of this all day, every day by
society and the single omnipotent industrial corporation that oversees it
all._

 _He wrote this 65 years ago. It couldn’t have been more apropos to what we’re
witnessing now than if had he written it this morning, right down to the
nostalgia-selling demagogue who seizes the opportunity to foment rebellion
amongst the displaced and disgruntled. When millions of people start seeing
their purpose begin to erode and their dignity being stolen from them, the
idea that there’s nothing left to lose starts to creep in._

The fact he wrote this 65 years ago yet the labor force and population have
grown in lockstep, augers against this.
[https://staticseekingalpha.a.ssl.fastly.net/uploads/2011/12/...](https://staticseekingalpha.a.ssl.fastly.net/uploads/2011/12/2/saupload_growth-
of-us-labor-force.jpg) Why would companies, especially in an economic
environment that is so competitive, keep employees that serve no purpose.

Buying and holding shares of Facebook, Google, Amazon, and Microsoft ,which
are are not only leading this techno revolution but profiting immensely from
it, is one the best ways to capitalize on this trend, which is what I have
been doing for the past few years (along with owning Bitcoin). I don't however
agree that automation will mean the 'end of jobs'. It's not that robots will
take all the jobs, but rather the labor market will become increasingly
bifurcated, with a 'creative class' at the top and the low-income service
sector jobs at the bottom, without much in between. There is significant
demand for service sectors jobs, of all skill levels, including skilled
technical jobs such as coding, teaching, consulting, and engineering. But also
huge demand for hospitality jobs; however, many of these jobs may not pay as
much as the jobs they replaced, or bring much personal fulfillment.

~~~
candiodari
> The fact he wrote this 65 years ago yet the labor force and population have
> grown in lockstep

Only the reporting has grown in lockstep. The metrics have changed to make
this happen. Some of the real story can be seen in these graphs:

[https://data.bls.gov/timeseries/LNS11300000](https://data.bls.gov/timeseries/LNS11300000)

[https://data.bls.gov/timeseries/LNS12026620](https://data.bls.gov/timeseries/LNS12026620)

(you'll have to change the dates to get the full picture. Works with a POST so
I can't link to it. Note that unemployment essentially is labour force - jobs.
Hence, the weakest members of the jobs force are counted double. Also,
discouraged workers are discounted (and the rules for discouraged workers
means they are essentially anyone unemployed for more than some months). The
real unemployment rate, discounting double jobs and including discouraged
workers is somewhere between 9 and 16%)

The short of it is that the job market froze, with a few bubbles in between,
at around 1984-1987 or so, at an unemployment rate of around 8% or so and has
been slowly but very steadily increasing since. Even the rate at which this is
happening is increasing. The government, of course, has changed definitions
again and again to show better numbers, but so far they don't go all out China
on us (ie. the real data still appears to be published by the government,
unlike in China where we know 15 million people were fired last year in
several provinces due to protests and violence resulting from it, but this is
not reported anywhere in government data)

Granted, that's still not quite the story of Kurt Vonnegut, but keep in mind
that we're about 30 years into a phase in history where jobs grow slightly
slower than population growth. This could be accelerating, or it could simply
be that under Obama there was no real jobs recovery despite "extraordinary
measures" by the Fed.

------
nocoder
This is going to be a rant, so apologies.

This is a pretty crappy read. Lacks real data and also unwillingness to look
outside of the tech bubble, seriously what serious AI work is apple or Netflix
doing? Its as if the author started with the conclusion and wrote up whole
thing to justify it. For large parts most of the tech people at Google/FB are
involved in getting more people click and buys ads. And Amazon are involved in
getting people to buy more stuff and reduce the costs of handling and shipping
them. So, if the logical conclusion that many visionaries in these thread are
saying is true that 90% will be useless then these companies will have nobody
to serve and will collapse before we reach that point anyways. Secondly, let's
believe this is true then if an economic system which does not benefit
majority deserves to be overthrown by any means even violent and rise of trump
is a step in right direction. Third, if the tech companies are so smart then
how were they caught with their pants down when a foreign power used their own
infrastructure and technology to help elect a leader that they ostensibly
opposed. Finally, the fundamental reason for the current stock boom is simply
liquidity and lack of asset classes outside of stocks which give meaningful
growth. This is not just limited to fang or usa but seen in many stock
markets. I actively invest and trade in India where the markets are hitting
new highs and the only reason right now for this is that in most places it is
very hard to get a good return plus there is excess institutional & industrial
capital since they are not optimistic of the growth and thus not investing in
augmenting capacities or production. So investing in stock market seems the
only alternative. One of the reasons for this liquidity is central banks
around the world have been pumping money. This will end when the excess
liquidity is pulled out from the global financial system.

~~~
shadofx
So Trump is a harbinger of technocommunism?

------
Apocryphon
"Player Piano" should be required reading for all. It doesn't have to be the
future, but it's a future worth examining.

~~~
sf_rob
"Manna"[1] as well. While I don't like the writing style, I love the story.
Especially since it shows AI gutting middle management in an interesting way
before robotics is mature enough to do all the dextrous tasks.

1 [http://marshallbrain.com/manna1.htm](http://marshallbrain.com/manna1.htm)

~~~
eadmund
I read Manna, but honestly I thought it was silly.

> Terrafoam is, by contrast, 'Worse and worse.'

No, it's not. Manna is better and better: it yields continually better
results.

> With all that happening, it is very hard to get people together to work on
> big projects.

Wouldn't it be cool if there were something to get people to work together on
big projects? Something like an economic force causing them to give a little
to get a little?

Frankly, I think the Australia Project would stagnate after a generation or
two, while Manna would continually improve. After a few generations, it'd be
much like to Communist states vs. the West: yes, the Communists _did_ often
improve on their initial conditions by quite a bit — but the free economies
improved even more. I recall a story about someone (in China, perhaps?)
bragging about how the government dumped a pallet of free cabbage on each city
block every time period. Free cabbage sounds wonderful to someone who was a
subsistence farmer — but Asian-American fusion cuisine on every city block
sounds even better.

And that's just within the construct of the story. A real-world example would
have _competing_ Manna-like systems.

Also, in the Manna world the problem is that in the U.S. most people don't
have the ability to contribute, and so they languish in Terrafoam. It provides
no reason for why they are suddenly more talented in the Australia Project.
That just doesn't make sense.

Anyway, I hope that mankind's actual future is not to choose between two
different totalitarian systems.

~~~
candiodari
> Also, in the Manna world the problem is that in the U.S. most people don't
> have the ability to contribute,

Most people don't have the will to contribute. They've always just coasted
through life doing what is described in the manna story. They always know what
to do next and the only reason they do anything at all is because someone
tells them to, or it directly provides satisfaction. After sufficient years
they complain that this restricts their ability to do anything at all,
especially to change, but of course that's not true. They could spend 2-4
years training themselves and they'd be perfectly able. The reason that
doesn't happen is not often lack of ability.

------
pdog
Interesting investment thesis, but isn't there a better way to hedge yourself
than buying tech stocks?

That's just a huge bet on a tiny number of cyclical revenue sources: online
shopping, online advertising, cloud services, iPhones, Microsoft Office, and
Windows.

~~~
leggomylibro
What will that tech need to survive?

Lithium, for batteries. Heavy metals, for processing. Energy, most of all. I
wonder how long it'll be until we replace fiat currencies with a balance of
kilowatt-hours.

~~~
Apocryphon
Energy is the currency of the future.

\- CEO Nwabudike Morgan, "The Centauri Monopoly"

~~~
endgame
That game was incredibly prescient.

I was going to link to its page on Paean to SMAC but it turns out that quote
is from "Global Energy Theory", a tech that didn't make it into the final game
(but had data set up for it). So there's no write-up about it.

Instead, I'll link to the Paean's "First Time Here?" page:
[https://paeantosmac.wordpress.com/first-time-
here/](https://paeantosmac.wordpress.com/first-time-here/)

~~~
KekDemaga
"No check, no tech." is something I use often.

------
jboggan
"We’re in an age where we’re being told AI is about to start writing its own
software."

The most pregnant sentence in the entire piece.

~~~
EliRivers
All the problems in every serious piece of software I've ever worked on stem
from the customer (be it external or in-house) not knowing what they want, the
person in charge of capturing that doing a pretty bad job of it anyway, and
the chain from there to the person writing the software taking that failure
and making it worse.

AI writing software will just get me another flavour of the wrong software. AI
working out what people want the software to do would be useful.

~~~
kmicklas
You don't think good old fashioned bugs are a problem?

------
Zanni
What I never see mentioned in these types of articles is the rise of the
service economy. There are some jobs that will never be automated because we
prefer to deal with humans. Take food service for instance. No one wants to go
to a high end steak house and have their wine poured and meal served by
robots. Human interaction is part of the experience and part of the value. (At
McDonald's, by contrast, the humans don't add value and could easily be
replaced.) The "human touch" is going to become _more_ important, not less, as
automation increases.

~~~
electrograv
_> No one wants to go to a high end steak house and have their wine poured and
meal served by robots._

I’m sorry, but that actually sounds like a wonderfully peaceful way to dine.

~~~
lostboys67
Don't take this the wrong way but you need to think about some therapy and
being able to take a random piece of steak and correctly prepare it 99% of the
time is a hard problem.

~~~
electrograv
What an odd argument. Preparing food correctly will almost certainly be more
reliable with machines.

Regarding the human element of dining: I think you lack foresight. We will
look back at human waiters as we now look at horses, vs modern cars. People
still ride horses, and that’s fine, but to suggest they’re the only way or
even the best way to go is just archaic and indiciative of an unhealthy level
of denial, or a calcified brain unable to change. Open your mind.

------
javajosh
A certain amount of compute capacity should be given with citizenship to each
individual. It is fixed. You get to use that capacity however you want: some
on your phone, some on your laptop. If you want to run an internet business
that uses a lot of compute capacity, then you'll need to rent it from other
individuals and consolidate it under your control.

~~~
explainplease
It sounds really silly, but that might actually be the only way to prevent a
few bad actors from taking over the world with killer robots. Of course,
enforcement would be a problem.

------
a_brawling_boo
I came to see if people were talking about the robotics and automation ETF
cited in the article and if it would be a good idea to buy at this point, but
seems that everyone is having philosophical conversation instead of a
investing conversation :-p

~~~
disease
From a clueless investor here, it seems like NVidia would be a good play if
you anticipate widespread growth in machine learning.

~~~
FLUX-YOU
GPUs are more useful than CPUs for ML, but eventually someone's going to want
to cut nVidia out of that process: [https://cloud.google.com/blog/big-
data/2017/05/an-in-depth-l...](https://cloud.google.com/blog/big-
data/2017/05/an-in-depth-look-at-googles-first-tensor-processing-unit-tpu)

nVidia is still a solid choice as VR has raised the visual fidelity demands
for games and experiences, and even a 1080Ti can't render VR games at 90+FPS
at max graphics. That's still a lot of demand nVidia has to meet.

------
MattyRad
Definitely an interesting read, if a bit pessimistic, nihilistic, and a bit
Marxist (seize the means of production!). But ultimately the article offers no
solutions and the author comes off to me as a doomsayer and luddite
([https://en.wikipedia.org/wiki/Luddite](https://en.wikipedia.org/wiki/Luddite)).
If the author really fears the current system as described, maybe he should
return to the old system: become a subsistence farmer and work till you die.

------
emiliobumachar
HN hug of death strikes again. Website does not reply.

~~~
drzaiusapelord
[http://webcache.googleusercontent.com/search?q=cache:http://...](http://webcache.googleusercontent.com/search?q=cache:http://thereformedbroker.com/2017/10/16/just-
own-the-damn-robots/)

------
gfodor
It's conditions where most market participants believe future returns are
inevitable that often lead to the biggest corrections. Eternal growth of
software companies is definitely a great example of "this time it's
different", surely one day it will be but the question for the investor today
is how confidently they can answer this question.

------
Density
In sci-fi the singularity is the moment when human consciousness merges with
machine.

In the real world the singularity is when people get so worked up about
automation they invest infinity money in tech companies.

e: I spent a solid chunk of my income on tech company stocks.

------
dogruck
Nice rant, but I think it would be stronger if it did more to consider the
counter arguments.

I see it as:

* perhaps AI will someday rule the world -- in which case there's nothing more to discuss

* if humans do still have a role, then they will work with the machines to figure out a solution

* most moaning about so called under privileged people, such as Uber drivers, ignores that their standard of living is far superior to people of the past (e.g. 1800s farmer) and the millions living in deep poverty or slavery today.

To be clear, I think there are many social problems that need to be addressed.

