I was out in Miami on an engagement recently and was talking to this young lady who i overheard at the club my client was part of. She is an OF model. She was joking about the money. I laughed and she looked at me. I told her in no uncertain terms that she had at most 3 years, more likely less than 2 years and to "harvest" every penny from OF for the next two years and to not spend a penny and invest it wisely and start looking for something else to do. It would be dead within 3 years, max. She was incredulous and laughed back at me that it would never end. I told he the combination of video generation models and chat and voice models all being able to utilize hyper aware AI models to cater individually to every person on earth would come first to porn (she was not old enough to understand that all new techs come first to p***) and would render humans worthless for the industry for at least 15 if not 20 years before a comeback of live. The first to go would be OF. The owners of OF are not stupid. In fact they are quite smart. They see that an investment in AI means keeping 100% of the money, not 30%. She wasn't laughing at the end. Maybe just smart enough.
Excellent, Jeff! I am reminded of an article written a few years ago about over-relying upon technology. As I recall, someone drove their car off a cliff because they were following the GPS versus their eyeballs. A couple got stranded in an Oregon blizzard because GPS directed them to “saunter off” the (plowed) interstate highway. It took them on what, in summer, might have been a clever short cut. In winter, the “AI” (GPS system) didn’t factor in lack of road maintenance/plowing. The couple nearly died from trusting technology over their own senses, intuitions, and common sense.
For the aviation context of excessive reliance on GPS and related technologies, see 'Children of the Magenta Line' by an American Airlines training captain:
AI is already starting to lie. One program cited a non-existent quote from a fake article that was supposed to have said law professor Jonathan Turley was accused of sexual improprieties with a student in Alaska. He’s never been to Alaska. I don’t really care how beneficial AI is to the efficiency of the economy if we have to live with liars that are yet even more skilled and cunning than the ones we already have. The Nazi’s were pretty economically efficient too. And we know how they used that power. Why should I believe AI will produce a better result? Im not a Luddite. But we are are close to crossing a technology threshold we may not be able to control, stop, or reverse. We might have crossed it already and not know it.
I think you've hit on something important, or at least, to me. Your third to last paragraph (free to choose) brings up as a corollary "at the margin" thinking and "at the margin" economics.
[ Economists argue that most choices are made "at the margin". The margin is the current level of an activity. Think of it as the edge from which a choice is to be made. A choice at the margin is a decision to do a little more or a little less of something. ]
I got the above from a quick google search. A very important concept in the history of the development of the human species. I don't think I am overstating it. I'm pretty sure "at the margin" thinking would go out the window as the algorithms could not or would not allow it and thus, adios to most progress.
Jeff, I want you to develop this idea. I think it is being horribly overlooked, or maybe it isn't and it is being ignored on purpose.
It is well understood that we fear what we don't understand. However, it does not follow that we should not fear it even if we do understand.
At the margin---sort of a calculus term....there are some decisions we don't quantify and don't think about every single day. it just makes life easier-even though there are costs and opportunity costs to every decision we make. does AI change that?
On a mildly related subject. If a non-profit is "not a business, but a hobby", then where is your economic opinion businesses that are cooperatives or shareholder owned?
A YouTuber I occasionally watch, "Adam Something", deplores the fact that nearly all businesses are all organized on an authoritarian line "like divine right kings" and that political democracy is mostly useless since for most people income is from employment, and in the United States, our health care as well. He has no solution he finds viable, but did mention cooperatives could be. Your opinion?
shareholder owned businesses (assume you are talking about ESOPs) try and turn a profit. Cooperatives may or may not turn a profit. For example, at CME we were a mutually held and private organization. Organized as a "non-profit" and run for the benefit of the members. If we were going to see a profit at the end of the year, we would suspend commissions on members so we could break even. Despite ourselves, we still ran a profit. (Sign of a good business!!) When we changed to for profit, the business operated differently and we went from a $150MM valued organization to an $80B value. I would argue that higher valuation means more benefit to society.
Health care isn't a great industry to look at when it comes to operating businesses. There is so much regulatory capture, so many regs that inhibit competition, so many price ceilings that markets can't work, so many things wrong with the structure of the business right down to the AMA deciding how many types of doctors there can be along with limits on hospital construction. But, a free market would drop the price of health care, create even more innovation, and increase the amount of care available to all.
Businesses are NOT democracies. They are shareholder organizations, and once a year shareholders vote on the board who exercises their will subject to fiduciary responsibility. I also think the idea on the left of "direct democracy" is a very poorly thought out one since it will lead to anarchy. It's why we have a "democratic republic". There is a big difference.
I pretty much concur with your standing on direct democracies, and also your comment about businesses beholden to shareholders is true - literally and legally. What I'm worried about is that shareholder rights have become substantially eroded over the decades. Share holding is driven by share price and not by dividends. Share structures have gone from common stock to whatever the hell Zuckerberg did with Meta/Facebook to secure control against any shareholder action.
As an engineer (full disclosure: never got my PE certs, went into software instead) who was exposed to the dark side of the medical industry (billing software) your views reflect the true reality that health care and health insurance in the US are not free markets - outside the limited number of concierge doctors. The AMA has gone from oversight to a guild with medical schools complying or getting shutdown, with restrictions in supply (doctors).
I am personally ambivalent on AI. Like all new things it can and will be used both for good and for evil. What I DO FEAR is its use by government. Anything that increases government power is BAD, really bad.
As far as AI "taking control" of everything, I have confidence in human ingenuity. Although, having read "The Rise of the Fourth Reich: Confronting COVID Fascism with a New Nuremberg Trial, So This Never Happens Again", perhaps that confidence is misplaced.
What is certainly true, is that if it does bring efficiencies to the market, that it will CREATE MORE JOBS THAN IT ELIMINATES. Now, this is counter-intuitive to most folks who don't understand basic economics (and that is most folks, unfortunately). Allow me to give a couple of easy examples to explain.
When ATM's became ubiquitous, everyone said that would eliminate jobs in the banking sector. NOT TRUE!!! Drive thru any suburban city or town and what you will see is a bank on nearly every corner!!! In the town I live in a suburb of Denver, at the intersection of Main Street and the major arterial that goes thru the downtown area there is a park on one corner and a total of SIX(6)!!! banks on the other three corners. Automation allowed banks to offer more services to its customers.
Same with services like InstaCart or curbside delivery at super markets. It frees up grocery stores to seek other ways to make money and therefore, serve more customers.
Automobiles did indeed eliminate buggy whip makers and blacksmiths but it made so many other things possible that were unthinkable before 1900.
No charge for the Econ 101 lesson. But I would like to be able to put my knowledge and skill set to work serving some home school kids...for a small fee of course:)
I was out in Miami on an engagement recently and was talking to this young lady who i overheard at the club my client was part of. She is an OF model. She was joking about the money. I laughed and she looked at me. I told her in no uncertain terms that she had at most 3 years, more likely less than 2 years and to "harvest" every penny from OF for the next two years and to not spend a penny and invest it wisely and start looking for something else to do. It would be dead within 3 years, max. She was incredulous and laughed back at me that it would never end. I told he the combination of video generation models and chat and voice models all being able to utilize hyper aware AI models to cater individually to every person on earth would come first to porn (she was not old enough to understand that all new techs come first to p***) and would render humans worthless for the industry for at least 15 if not 20 years before a comeback of live. The first to go would be OF. The owners of OF are not stupid. In fact they are quite smart. They see that an investment in AI means keeping 100% of the money, not 30%. She wasn't laughing at the end. Maybe just smart enough.
How did you not link to her profile so the community could help her out?
Excellent, Jeff! I am reminded of an article written a few years ago about over-relying upon technology. As I recall, someone drove their car off a cliff because they were following the GPS versus their eyeballs. A couple got stranded in an Oregon blizzard because GPS directed them to “saunter off” the (plowed) interstate highway. It took them on what, in summer, might have been a clever short cut. In winter, the “AI” (GPS system) didn’t factor in lack of road maintenance/plowing. The couple nearly died from trusting technology over their own senses, intuitions, and common sense.
For the aviation context of excessive reliance on GPS and related technologies, see 'Children of the Magenta Line' by an American Airlines training captain:
https://www.youtube.com/watch?v=5ESJH1NLMLs&t=23s
And for a railroad context, see my post Blood on the Tracks:
https://chicagoboyz.net/archives/43911.html
No AI involved here, just a rigid automated system enforced by a rigid bureaucratic system.
Incredible! I could imagine this coming up again with automobiles.
AI is already starting to lie. One program cited a non-existent quote from a fake article that was supposed to have said law professor Jonathan Turley was accused of sexual improprieties with a student in Alaska. He’s never been to Alaska. I don’t really care how beneficial AI is to the efficiency of the economy if we have to live with liars that are yet even more skilled and cunning than the ones we already have. The Nazi’s were pretty economically efficient too. And we know how they used that power. Why should I believe AI will produce a better result? Im not a Luddite. But we are are close to crossing a technology threshold we may not be able to control, stop, or reverse. We might have crossed it already and not know it.
this is where I think crypto is useful to identify the true source, and reality vs fake
I’m no computer scientist, but why can’t an AI figure out a way to fake or alter a blockchain?
for that to happen, it would have to fake an entire blockchain. if it was a public token like ethereum or bitcoin, couldn't happen.
I think you've hit on something important, or at least, to me. Your third to last paragraph (free to choose) brings up as a corollary "at the margin" thinking and "at the margin" economics.
[ Economists argue that most choices are made "at the margin". The margin is the current level of an activity. Think of it as the edge from which a choice is to be made. A choice at the margin is a decision to do a little more or a little less of something. ]
I got the above from a quick google search. A very important concept in the history of the development of the human species. I don't think I am overstating it. I'm pretty sure "at the margin" thinking would go out the window as the algorithms could not or would not allow it and thus, adios to most progress.
Jeff, I want you to develop this idea. I think it is being horribly overlooked, or maybe it isn't and it is being ignored on purpose.
It is well understood that we fear what we don't understand. However, it does not follow that we should not fear it even if we do understand.
At the margin---sort of a calculus term....there are some decisions we don't quantify and don't think about every single day. it just makes life easier-even though there are costs and opportunity costs to every decision we make. does AI change that?
Excellent article Mr. Carter.
On a mildly related subject. If a non-profit is "not a business, but a hobby", then where is your economic opinion businesses that are cooperatives or shareholder owned?
A YouTuber I occasionally watch, "Adam Something", deplores the fact that nearly all businesses are all organized on an authoritarian line "like divine right kings" and that political democracy is mostly useless since for most people income is from employment, and in the United States, our health care as well. He has no solution he finds viable, but did mention cooperatives could be. Your opinion?
shareholder owned businesses (assume you are talking about ESOPs) try and turn a profit. Cooperatives may or may not turn a profit. For example, at CME we were a mutually held and private organization. Organized as a "non-profit" and run for the benefit of the members. If we were going to see a profit at the end of the year, we would suspend commissions on members so we could break even. Despite ourselves, we still ran a profit. (Sign of a good business!!) When we changed to for profit, the business operated differently and we went from a $150MM valued organization to an $80B value. I would argue that higher valuation means more benefit to society.
Health care isn't a great industry to look at when it comes to operating businesses. There is so much regulatory capture, so many regs that inhibit competition, so many price ceilings that markets can't work, so many things wrong with the structure of the business right down to the AMA deciding how many types of doctors there can be along with limits on hospital construction. But, a free market would drop the price of health care, create even more innovation, and increase the amount of care available to all.
Businesses are NOT democracies. They are shareholder organizations, and once a year shareholders vote on the board who exercises their will subject to fiduciary responsibility. I also think the idea on the left of "direct democracy" is a very poorly thought out one since it will lead to anarchy. It's why we have a "democratic republic". There is a big difference.
I pretty much concur with your standing on direct democracies, and also your comment about businesses beholden to shareholders is true - literally and legally. What I'm worried about is that shareholder rights have become substantially eroded over the decades. Share holding is driven by share price and not by dividends. Share structures have gone from common stock to whatever the hell Zuckerberg did with Meta/Facebook to secure control against any shareholder action.
As an engineer (full disclosure: never got my PE certs, went into software instead) who was exposed to the dark side of the medical industry (billing software) your views reflect the true reality that health care and health insurance in the US are not free markets - outside the limited number of concierge doctors. The AMA has gone from oversight to a guild with medical schools complying or getting shutdown, with restrictions in supply (doctors).
I am personally ambivalent on AI. Like all new things it can and will be used both for good and for evil. What I DO FEAR is its use by government. Anything that increases government power is BAD, really bad.
As far as AI "taking control" of everything, I have confidence in human ingenuity. Although, having read "The Rise of the Fourth Reich: Confronting COVID Fascism with a New Nuremberg Trial, So This Never Happens Again", perhaps that confidence is misplaced.
What is certainly true, is that if it does bring efficiencies to the market, that it will CREATE MORE JOBS THAN IT ELIMINATES. Now, this is counter-intuitive to most folks who don't understand basic economics (and that is most folks, unfortunately). Allow me to give a couple of easy examples to explain.
When ATM's became ubiquitous, everyone said that would eliminate jobs in the banking sector. NOT TRUE!!! Drive thru any suburban city or town and what you will see is a bank on nearly every corner!!! In the town I live in a suburb of Denver, at the intersection of Main Street and the major arterial that goes thru the downtown area there is a park on one corner and a total of SIX(6)!!! banks on the other three corners. Automation allowed banks to offer more services to its customers.
Same with services like InstaCart or curbside delivery at super markets. It frees up grocery stores to seek other ways to make money and therefore, serve more customers.
Automobiles did indeed eliminate buggy whip makers and blacksmiths but it made so many other things possible that were unthinkable before 1900.
No charge for the Econ 101 lesson. But I would like to be able to put my knowledge and skill set to work serving some home school kids...for a small fee of course:)
AI will be open boarders for a lot of mid to upper level managers. And learn to code won't be an option any longer.
Amjad Masad, CEO of Replit:
"People constantly ask me “given how good AI is at coding is it still worth it to learn to code?”—
Are you crazy? The ROI on learning to code has 10x’d with AI.
Learn the basics and with some tenacity you can build your dream MVP.
Links to get started in thread"
https://twitter.com/amasad/status/1647740551180218368
Change is coming! A couple good articles by Robin Hanson:
https://www.overcomingbias.com/p/ai-fear-is-mostly-fear-of-future
https://quillette.com/2023/04/14/what-are-reasonable-ai-fears/