The Emerging, Unpredictable Age of AI

By Irving Wladawsky-Berger

In a 1930 essay, Economic Possibilities for our Grandchildren, English economist John Maynard Keynes wrote about the onset of “a new disease” which he called technological unemployment, that is “unemployment due to our discovery of means of economising the use of labour outrunning the pace at which we can find new uses for labour.”

“But this is only a temporary phase of maladjustment,” he added. “I would predict that the standard of life in progressive countries one hundred years hence will be between four and eight times as high as it is.” Keynes believed that technological progress would lead us to a brighter future. By 2030, people would likely work no more than 15 hours a week, and their biggest problem would be how to use their leisure and freedom from economic cares.

I was reminded of Keynes’ predictions while reading a number of recent articles on our emerging age of AI. After decades of unfulfilled promises and hype, AI seems to be reaching a tipping point. The necessary ingredients are finally coming together: lots and lots of data, with the volume of data pouring in expected to double every three years or so; advanced machine learning algorithms that extract insights and learn from all that data; drastically lowered technology costs for collecting, storing and analyzing these oceans of information; and access to an increasing variety of data-driven, cloud-based AI applications.

A small, but prominent group of technologists and scientists have warned that at some future time, a super-intelligent AI might pose an existential threat to humanity. But while dismissing such dire concerns, most experts worry that the real threat is that AI advances could lead to widespread economic dislocation and social unrest. “Contrary to the more fantastic predictions for AI in the popular press, the Study Panel found no cause for concern that AI is an imminent threat to humankind…” was the conclusion of a recent study by AI experts. “At the same time, many of these developments will spur disruptions in how human labor is augmented or replaced by AI, creating new challenges for the economy and society more broadly.”

There’s a broad consensus that AI will have a major impact on jobs and the very nature of work, but it’s much less clear what that impact will be.

Will the AI revolution play out like past technology revolutions— short term disruptions and economic dislocations, followed by long-term benefits, as the new technologies eventually lead to the creation of new jobs, whole new industries, and a rising standard of living? Or, is this time different, as AI-based innovations are now being applied to activities requiring intelligence and cognitive capabilities that not long ago were viewed as the exclusive domain of humans? What will life be like in such an AI future?

While the future is nearly impossible to predict, opinions abound. Let me discuss a couple of very different such opinions, starting with a recent CIO Journal interview with Vinod Khosla, among the world’s most influential venture capitalists. Khosla believes that we’re entering a new age where AI will help companies reduce costs across the board, becoming a major competitive advantage, but leading to massive job displacements. He predicts that in 20 years, perhaps somewhat longer, 80 percent of the workforce may well be replaced by AI-based automation.

In a related 2014 Forbes article, Khosla wrote: “It seems likely that the top 10 to 20-percent of any profession, be they computer programmers, civil engineers, musicians, athletes or artists, will continue to do well. What happens to the bottom 20-percent or even 80-percent, if that is the delineation? Will the bottom 80-percent be able to compete effectively against computer systems that are superior to human intelligence?…”

“Even with access to better education and skills, not enough humans could adapt quickly enough to outperform intelligent software systems. It seems likely that humans will lose this race against the machine in many, if not most, work domains causing a large shift in employment much like the transition away from an agrarian economy in the early 20th Century. First, we lost the physical labor battle to engines, and now, we may lose the mental labor battle.”

While acknowledging the potential for serious economic dislocations, a number of other experts are more positive about the long-term impact of AI, Their views are nicely captured in a recent Newsweek article by author and columnist Kevin Maney — “All those dire predictions about the automated economy sound like a sci-fi horror film from the ’50s: Robots are coming to take your jobs, your homes, your children. Except it’s real. And it has a happy ending.”

Maney illustrates his thesis up front with the story of self-serve gas pumps. Automated gas pumps killed hundreds of thousands of jobs over the years. “The loss of those jobs was undoubtedly devastating for the individuals who had them, but the broader impact has been pretty positive for the rest of us. As has happened throughout the history of automation, some jobs got destroyed by automated gas pumps, but new and often better jobs were created,” including the engineers, software coders, sales staff, service technicians and project managers to make and maintain the sophisticated self-serve pumps.

“Station owners took their extra profits and turned their stations into mini-marts, which needed clerks, and built more gas stations, which needed more pumps… Consumers spent less money on gas because they weren’t paying for someone else to pump it. That left them more money for iPhones or fish tacos ordered on Seamless, creating more new kinds of employment.”

“Yeah, your automated gas pump killed a lot of jobs over the years, but its biography might give you hope that the coming wave of automation driven by artificial intelligence (AI) will turn out better for almost all of us than a lot of people seem to think…” writes Maney. “Economists have shown time and again that automation helps overall standards of living rise, literacy rates improve, average life span lengthen and crime rates fall. After waves of automation — the Industrial Revolution, mechanization, computerization — we’re way better off in almost every way… And now, even with software automating all kinds of work, there are signs that the technology is creating more jobs than it destroys.”

But, there is indeed a scary part to this story, adds Maney.

“AI will lead us into the mother of all tech revolutions. The last time anything came close was around 1900, when the automobile, telecommunications, the airplane and mass electrification all came together at once, radically changing the world from the late 1800s to the 1920s.” Something similar is now taking place in our hyper-connected global markets. Waves of technology are being invented and deployed at warp-speed. Such times are particularly frightening and difficult to handle.

“Today’s AI-driven revolution is coming so fast that we have trouble even imagining how it will turn out.” In the future, for example, it’s quite likely that robots won’t just build cars and trucks but also drive them. We might soon be at a point “when AI can get built to do almost anything, including, possibly, your job… In the long run, we’ll find equilibrium. But the transition in the short term will suck for a lot of people you know. And maybe for you.”

Nevertheless, he remains optimistic.

“Over and over again, the robot economy will invent work we can’t even dream of today, much as the internet gave birth to unforeseen careers… Successful people in the AI age will focus on work that takes advantage of unique human strengths, like social interaction, creative thinking, decision-making with complex inputs, empathy and questioning. AI cannot think about data it doesn’t have… Only humans can think that way.” We must come up with strategies that allow human workers to complement, collaborate and race ahead with our AI machines instead of racing against them.

“If this is a fairy tale about work and jobs, AI is both the bad witch and good witch — destroyer and creator,” writes Maney in conclusion. “In such stories, good almost always wins. But in the middle of the story, the characters don’t know that. And that’s where we are now: face to face with the monster for the first time, doing everything we can to get through the scary forest alive.”

Irving Wladawsky-Berger is Chairman Emeritus of the IBM Academy of Technology, and a Visiting Professor of Engineering Systems at MIT, where he is involved in multi-disciplinary research and teaching activities focused on how information technologies are helping transform business organizations and the institutions of society.

This blog first appeared Feb. 7, here.




The IDE explores how people and businesses work, interact, and prosper in an era of profound digital transformation. We are leading the discussion on the digital economy.

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