Doomsday Code and Other Keynesian Illusions
Remnant Review
I have stolen and reworked the title of this article from The New Yorker, which in the November 23 issue published "The Doomsday Invention: Will artificial intelligence bring us utopia or destruction?"
The article began as follows:
Last year, a curious nonfiction book became a Times best-seller: a dense meditation on artificial intelligence by the philosopher Nick Bostrom, who holds an appointment at Oxford. Titled "Superintelligence: Paths, Dangers, Strategies," it argues that true artificial intelligence, if it is realized, might pose a danger that exceeds every previous threat from technology--even nuclear weapons--and that if its development is not managed carefully humanity risks engineering its own extinction. Central to this concern is the prospect of an "intelligence explosion," a speculative event in which an A.I. gains the ability to improve itself, and in short order exceeds the intellectual potential of the human brain by many orders of magnitude.Such a system would effectively be a new kind of life, and Bostrom's fears, in their simplest form, are evolutionary: that humanity will unexpectedly become outmatched by a smarter competitor. He sometimes notes, as a point of comparison, the trajectories of people and gorillas: both primates, but with one species dominating the planet and the other at the edge of annihilation. "Before the prospect of an intelligence explosion, we humans are like small children playing with a bomb," he concludes. "We have little idea when the detonation will occur, though if we hold the device to our ear we can hear a faint ticking sound."
At the age of forty-two, Bostrom has become a philosopher of remarkable influence. "Superintelligence" is only his most visible response to ideas that he encountered two decades ago, when he became a transhumanist, joining a fractious quasi-utopian movement united by the expectation that accelerating advances in technology will result in drastic changes--social, economic, and, most strikingly, biological--which could converge at a moment of epochal transformation known as the Singularity.
The theme of the singularity goes back at least to a 1956 short story by Isaac Asimov: "The Last Question." The best-known promoter of this theme is Ray Kurzweil.
From the popular entertainment point of view, the first big promotion of this theme was found in the 1956 movie, Forbidden Planet: the Krell. It was extended in the original Star Trek movie of 1979: Veejer. I have come back to this theme on numerous occasions.
This is a fundamental theme that is implicit in the doctrine of evolution through natural selection: the next leap of being, this time created by mankind, who has introduced purpose into the cosmos. Another theme, closely related, is also one of the two primary themes of Asimov's short story: entropy, or the heat death of the universe. I devote chapter 2 of my 1988 book, Is the World Running Down?, to this theme. You can download it free here: http://bit.ly/gnworld.
For the purposes of this essay, I focus on two words of Bastrom's vision: "managed carefully." These are what I like to call weasel words. The phrase "weasel words" has been around a long time, and certainly it applies to this case. Weasel words are open-ended and undefined. The phrase "managed carefully" leads people to imagine a committee of experts who are, collectively, capable of managing things carefully. In other words, the phrase invokes the logic of the planned economy.
COLLECTIVE IRRATIONALISM
The problem with the logic of the planned economy is simple: it always leads to irrationalism. We have known this, or at least free market economists have known this, ever since Ludwig von Mises' 1920 article, "Economic Calculation in the Socialist Commonwealth." Hayek extended this insight in his 1945 essay, "The Use of Knowledge in Society." This criticism of collective planning is basic to Austrian school economics. The basic idea is this: no committee has access to the knowledge that the decentralized free market does. What is necessary to gain access to this decentralized knowledge is a system of private property that is organized by a system of economic calculation -- the price system -- which in turn is based on money. That goes back to Mises' original insight.
Faith in committees is endemic in today's intellectual elite. The intellectuals cannot break their faith in the organizing power of committees. They believe that people like themselves will be appointed by the politicians to these committees. They will thereby gain power over free market entrepreneurs, and through this power, will then tell the masses what they are allowed to do.
We read this report in Forbes.
Touch-screen ordering at fast food restaurants, robots welding car parts at Tesla factories, apps like Uber taking a bite out of the taxi and limo industry: They're all good for innovation but perhaps not so great for the workers whose jobs are on the line, according to real estate billionaire Jeff Greene."What globalization did to blue collar jobs and the working class economy over the past 30 or 40 years, big data, artificial intelligence and robotics will do to the white collar economy -- and at a much, much faster pace," says Greene.
It's a problem that will only exacerbate the growing gap between the rich and the poor, he claims, because we've left ourselves unprepared for the inevitable automation of many jobs traditionally done by humans.
"I realized that that is the greatest threat we have in our country today," says Greene. "So I thought, 'Let's convene some of the greatest minds from academia, government, business and the nonprofit sector to come together to talk realistically about what's happening.'"
What he devised is a two-day conference spanning Monday and Tuesday dubbed "Closing the Gap: Solutions for An Inclusive Economy," hosted by Greene at Palm Beach's Tideline Ocean Resort & Spa. Speakers include former British Prime Minister Tony Blair, author Thomas Friedman, former Apple and Pepsi CEO John Sculley, lawyer and TV personality Star Jones and boxing legend Mike Tyson.
Panels will cover everything from debates about the role of government in trimming the gap between the rich and poor to which technologies will disrupt the workplace and fundamental discussions about fairness and corporate social responsibility.
Here is another billionaire I have never heard of. Oh, well. Billionaires these days are a dime a dozen. But however much money he has made in real estate, he doesn't have a sense of humor. He does not see the humor of a committee to save the world that includes Tony Blair and Mike Tyson. My only question is this: where is Al Gore?
Actually, I think an intellectual conference that deals with what is supposedly the most important issue of our day probably should include both Tony Blair and Mike Tyson. That gives some indication of the relevance of such a conference. I would say the same if the conference included such luminaries as Stephen Hawking, Bill Gates, and Warren Buffett. The conference would still come to nothing. It is a conference in search of a government solution to a problem that government cannot solve, assuming that the problem even exists.
MOORE'S LAW
What committee is going to be capable of predicting the outcomes of trillions of interactions in the free market, tens of thousands of gifted computer programmers, and the next innovation that will carry Moore's Law beyond the atomic limits of silicon -- limits which are expected to raise their ugly head by 2020? If information costs continue to fall by 50% every two years, or every 18 months, or every 12 months, the results are inherently not predictable. That is the meaning of Hayek's spontaneous order. After all, it is spontaneous. No state committee directs it. No committee can even foresee it.
The spontaneous order is also orderly. It is orderly because of the market's profit-and-loss accounting system. It is the inescapable feedback, both positive and negative, of profit and loss, of supply and demand, of input and output, that provides order in the economic world. This is the insight of Austrian school economics more than any other school of economics. This is the issue of entrepreneurship, which is at the heart of Austrian school economics. Entrepreneurship is inherently unpredictable, which is why there are both entrepreneurial profits and losses.
This brings me back to a theme that I keep returning to: the unprofitability of mass unemployment. It takes capital to fund entrepreneurial ventures. To get access to more capital, you have to offer investors the possibility of making profits. To make profits in a mass production economy, you have to serve the economic demands of billions of people.
The reason why there is inequality in every economy is because a tiny number of entrepreneurs at the top of the pyramid of wealth meet the demands of the masses of people lower on the pyramid. If all of the people, or most of the people, in the lower range of the pyramid are unemployed, and therefore no longer economically productive, the innovators at the top will not be able to generate profits to fund their next customer-satisfying ventures. That ends the process of Moore's Law. That ends the process of robotics. In other words, that ends the problem.
Because the intellectuals who have devoted their thinking to the problem of Moore's Law and robotics do not think in terms of Austrian school economics, they cannot deal coherently with this obvious limitation of their doomsday scenario. The process of entrepreneurial innovation that is associated with Moore's Law and robotics will cease as soon as the process no longer turns profits for entrepreneurs. They are not going to keep losing money. If they do, they will eventually run out of money, and the innovations will cease.
If billions of people are unemployed, there are entrepreneurial opportunities for making profits by putting them back to work. They are unemployed capital assets. Capital assets can become profitable at some price. Unemployed people are cheaper to hire than expensive machines.
The free market's system of competitive bidding, when allowed by the state to function, puts unemployed people to work. But Keynesians do not believe this. They are the people who are in a dither about robotics.
INDIVIDUAL PROFITS AND COLLECTIVE BENEFITS
The whole point of free market economics, from the logic of Adam Smith to the present, is this: individual innovation and profitability is tied to collective benefits. The prosperity of the one, meaning society, is dependent upon the prosperity of the many.
The innovators who come up with the profitable breakthroughs meet the ever-increasing desires of the masses of humanity. In other words, the genius innovators at the top are not going to make their livings by selling inventions to each other. They are not like members of a mythical society whose members earns their livings by taking in each other's washing, a phrase that goes back to my professor of apologetics, Cornelius Van Til.
This means we do not need a committee, with or without Mike Tyson, that will reveal to us what kinds of government intervention are necessary to restrain the development of Moore's Law and robotics. No such committee exists. No such committee could conceivably exist. No such committee could impose the tyranny necessary to control the development of every conceivable computerized innovation that might lead to the creation of artificial human intelligence, and beyond that, to a new humanity that will continue its evolution until it becomes God. This is the theme of Asimov's original story, just as it was the theme of Fredric Brown's earlier story, "Answer" (1954).
This faith in committees designing scientific progress is so utterly preposterous that it boggles the imagination that anybody, whether a billionaire or a professor at Oxford, could possibly believe it. The whole idea of open inquiry is based on this assumption: open inquiry will lead to positive results. This is a crucial foundation of the idea of progress. It is a faith in individual initiative, innovation, and discovery. It is antithetical to the whole idea of central planning. Yet we are told that someone who is supposedly the greatest academic expert on the question of artificial intelligence is barking up the same wrong tree that a billionaire real estate mogul is barking up.
PREDISTINATION BY THE STATE
These people believe in collectivism. They believe in predestination by man.
Last week, I reprinted R. J. Rushdoony's 1964 article, "The Society of Satan." I quote from its opening paragraph:
Man is inescapably religious. He may deny God, but all the categories of his life remain religious, and all are categories borrowed from the Triune God. Since the only world man lives in is the world God created, his thinking even in apostasy is inevitably conditioned and governed by a God-given framework. Men cannot escape that framework. They may deny God's sovereignty, but they cannot stop believing in sovereignty; they merely transfer it to man or to the State. Total law and planning, i.e., predestination, is inescapable; denied to God, it is simply transferred to the scientific socialist State which predestines or totally governs and plans all things; if deity be denied to the God of Scripture, it merely reappears in man or the State.
These people really do believe that mankind can and soon will evolve into a new creation, based on the works of his own hands and mind, collectively speaking. This is the meaning of the singularity.
The dark side of this vision is the supposed mass unemployment that is going to come as a result of Moore's law coupled with robotics. Unemployment, for the modern economist, and also for the modern voter, is the equivalent of hell on earth. The collectivist's only solution to this is a massive welfare state. The free market is supposedly going to make a minority of people efficient, and the rest of the world is going to be unemployed.
If that should ever happen, then the rest of the world will not be buying anything. But if the rest of the world is not buying anything, then the output of modern capitalism will find no buyers. If it finds no buyers, the capitalists will stop the developments that are producing massive unemployment. They will do this sooner than later. They are smart enough to stop pouring money down rat holes.
The Keynesians and collectivists among us do not believe this. They do not believe that individual initiative, when governed by the profit-and-loss system, rewards the masses of humanity. They have never believed it. They believe that government intervention is necessary to force entrepreneurs to meet the needs of unproductive people who are put on the dole by the state. This is the ideology of the welfare state. The best and the brightest of the university appointments, and the best and the brightest of the billionaire moguls, keep coming back, like a dog to its vomit, to this concept: entrepreneurship is self-destructive. To put it in the famous phrase of the textbooks that assess Franklin Roosevelt's New Deal, "Roosevelt saved capitalism from itself."
GOOD NEWS
The good news is this: no government committee can possibly foresee the next development in computer technology which will enable the next round of firings. Politicians who pass minimum-wage legislation will certainly increase the magnitude of these firings.
Similarly, no government committee can possibly foresee the next development in computer technology which will enable fired people to find productive employment.
The assumption of the collectivists is this: most fired people in a free-market society will remain unemployed, and will ultimately starve to death. This is counter to all economic history ever since the Irish potato famine of the 1840's. There has been no mass starvation, or even local starvation, except under conditions of socialism, wartime, and government violence. The free market has provided employment for people whose jobs have been replaced by more efficient techniques of production.
Every time there are new innovations in the production process, the collectivists run around wildly, waving their hands, and shouting: "This time, it's different!" This time, we are assured, the unemployed will no longer be able to find jobs. This time, they will all starve unless the state intervenes to create a massive system of wealth redistribution. Yet every time, the frantic hand-wavers have been wrong.
Within the free market economy, the profit-and-loss system of accounting establishes built-in limitations on entrepreneurial innovations that do not favor the masses of humanity. Long before some innovation produces a process that undermines the benefits of the broad mass of humanity, it becomes unprofitable. The innovators cease pursuing processes that produce nothing but red ink. Only civil governments pursue processes that produce nothing but red ink.
I admit that some biological innovation could lead to a plague: the killer bugs in the test tube could get out. This is conceivable. It has never happened, but it is conceivable. But I assure you that entrepreneurs will then focus their activities on developing an antibiotic or some countermeasure against the plague. They will not continue to pursue the production of plague. Governments may do that, but the free market will not.
What terrifies the doomsayers is the realization that their system of collective control over individual innovation is powerless in the face of free-market innovation. There is no way that any government committee can put a stop to some distant programmer whose innovation is going to produce temporary unemployment for 1,000 or 5,000 employees. Yet the collectivists seem powerless to break their addiction to the collectivist mindset. They keep calling for committees that will somehow lay down ground rules, meaning state-enforceable ground rules, that will keep innovations from being adopted by the marketplace. On the surface of it, the idea is preposterous. Yet they keep coming back to it. One of them has called together a meeting where Mike Tyson may come up with the solution.
This really is Mike Tyson economics. Keynesian economics is Mike Tyson economics. When you think "John Maynard Keynes," think "Mike Tyson."
CONCLUSIONS
We are seeing the obvious self-destruction of Keynesian economic theory. It is clear that Moore's Law, coupled with robotics, is going to undermine the General Theory of Employment, Interest, and Money. This assumes that Janet Yellen's Federal Reserve and the other central banks don't undermine it first. There is no way for Keynesian central planners to direct market capital in such a way as to prevent the unemployment of people who are supposed to be permanently unemployable. Why not? Because there will not be enough money from the welfare state to put these people on a permanent dole. The retirees already have first dibs on the money. Granny is going to get most of the money; victims of minimum-wage legislation are not.
My advice to people who are worried about Moore's Law and robotics is this: keep ahead of the computers in your own field. You cannot do anything about the economy as a whole, and neither can the Keynesians. The innovations are coming, and the central planners are powerless to stop them.
Central planners in one country may think they can stop digital innovation, but across the border, or across the seas, there is some programmer who is developing an innovation that is going to cross all borders by way of the Internet. Nothing that the committees in any one country can do will stop the spread of this innovation. The decentralization of market processes is now manifested by the Internet. The central planners are incapable of doing more than slowing down the processes of innovation that are overcoming the modern welfare state and the Keynesian committees.
To the Keynesians, I say: get used to it.