How technology will murder capitalism

Economic Armageddon: The sharing economy, artificial intelligence, the Internet of Things, and economic devastation

Sometime last century, R. Buckminster Fuller coined the term ephemeralization. Ephemeralization describes the ability of technological advancement to do “more and more with less and less until eventually you can do everything with nothing.”

It’s undeniably true, evidence of ephemeralization is everywhere.

While it once took many monks many weeks to write out copies of a book, and then many horses and many carts to distribute those handwritten books over but a very small geographic region, one can now instantly distribute abundant information across the entire globe at zero cost. And that’s just one small example.

The objective of this article is to demonstrate the threat posed to businesses — and the economy at large — by technological advancement.

Democratized Power

In another one of my articles, Why traditional businesses are screwed, I (as its title suggests) examined the reason for the coming “mass extinction” of businesses. I illustrated the overarching shift that will drive the vast majority of today’s businesses to oblivion.

So what was this overarching shift?

Answer: The democratization of power.

Or, in other words, the fact that technology is not only becoming increasingly powerful but accessible to all.

A visible example of this shift has been the fact that commuters have replaced newspapers, where readers merely consume content, with the likes of Facebook and Reddit, where technology has given them the power to create and distribute their own content.

So that’s democratized power for you. Power that was once largely inaccessible has become universally accessible. Thanks to democratized power, newspaper conglomerates have been replaced by content-generating commuters.

Corporations are being replaced by citizens.

And it’s not just communications that are being democratized. Tools, too, are being democratized. Here’s another quote from that other article of mine:

Already, 3D printers have been used to ‘print’ clothes, furniture, food, guns, mobile phones, laptops, solar panels, cars, houses, apartment buildings, and many other different things. In fact, 3D printers can even replicate themselves (i.e. print other 3D printers).
Now, add to all of that the following: You can already buy a wide range of 3D printers for about the same price as a computer.
In other words, we are not far from the day where pirating the latest iPhone or Lamborghini will be just as easy as it currently is (due to democratized communications) to pirate the latest film or chart-topping single.

Overall, just keep the following in mind: Power is being radically democratized.

Artificial Intelligence

Now, here’s the next idea: Advances in artificial intelligence (A.I.) are removing inefficiencies.

Here’s just one small example, from a New Scientist article titled, “The AI boss that deploys Hong Kong’s subway engineers”:

An algorithm schedules and manages the nightly engineering work on one of the world’s best subway systems — and does it more efficiently than any human could.
Chun’s AI program works with a simulated model of the entire system to find the best schedule for necessary engineering works. From its omniscient view it can see chances to combine work and share resources that no human could.

Sharing Economy and the Internet of Things

Now, in addition to artificial intelligence, I want you to consider two other ideas: The sharing economy, and the Internet of Things (IoT).

The sharing economy is a concept typically used to help explain companies like Uber and Airbnb, which allow users to share things, such as their car or spare bedroom.

The IoT allows those things (and many other things) to communicate with each other. For example, someone’s fridge might sense that it’s running low on milk, and automatically order some more milk online. Similarly, someone’s self-driving car might tell the owners house that they’re on their way home, and so the house should turn on the heating and put on some ambient music.

Economic Armageddon

What happens when you combine these three concepts? The sharing economy, plus A.I., plus the IoT?

What do you get?

I’ll tell you what you get: The epitome of efficiency.

Here’s an example to demonstrate exactly what I mean:

Currently, almost everybody with a yard has a lawnmower.

How often do they use it?

Maybe for half an hour once every fortnight, probably less. At the very most, that means you use your lawnmower 0.149% of the time. One tenth of one percent. The other 99.961% of the time, it’s just sitting in the shed.

You’d think that with that kind of staggering inefficiency that neighbourhoods would just chip in 10 cents a household and buy a communal lawnmower. That way, it might end up getting used 50% of the time, and everyone saves hundreds of bucks. But I digress.

Thousands of lawnmowers being used only 99.961% of the time.

The point I’m getting at, however, is that when you combine advances in A.I. and the IoT, along with the shift to the sharing economy, you’ll probably end up (in this lawnmower example, anyway) with only one person per neighborhood owning a lawnmower.

Not thousands of lawnmower owners, but one. Except, this self-driving lawnmower mows the lawn of everybody in that neighborhood. It gets used 100% of the time, and inefficiency is removed.

Or, perhaps nobody owns the lawnmower. Perhaps this efficiency-loving neighbourhood set up a Facebook group and all chipped in 10 cents to buy their communal SmartMower.

Or, to take this example even further, let’s add to our sharing economy/A.I./IoT soup a sprinkling of democratized tools (such as 3D printing/personal manufacturing). In this case, the neighborhood didn’t need to chip in 10 cents each to buy the communal lawnmower.

Instead, some teenager just went to https://thepiratebay.se/ and pirated Apple’s latest iMower. After downloading the file on uTorrent, he prints it out on his family’s 3D printer.

Or, if we want to give this kid the benefit of the doubt, let’s just be generous and say he did it legally. Perhaps he went on Facebook and one of his friends shared a viral post of an open source lawnmower design (just as today we get viral news articles and memes).

Either way, whether the lawnmower is crowdsourced like a Wikipedia article, or simply pirated, it doesn’t matter. The result is the same.

Instead of the thousands of households in that neighborhood all having spent hundreds of dollars each to buy thousands of lawnmowers that they all only use 0.149% of the time, they simply have one lawnmower.

One!

Furthermore, that lone lawnmower cost nothing. Its design was crowdsourced, and its production required no factories, assembly lines, warehouses, advertising agencies, trucks, ships, retail stores, distribution networks. Nothing.

And when you put all of that together, capitalism finally kicks the bucket.

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