Technology and inequality

Technology and inequality
Principal, Delta Wisdom
Chair, London Futurists
londonfuturists.com
deltawisdom.com
Recent history & future scenarios
Radical opportunity & radical risk
David Wood
@dw2

@dw2
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Accelerating
technology
Enhancing
humans
Extra intelligence
Extra health
Extra longevity
Extra experience
Disturbing
humanity
Worse terrorism
Worse surveillance
Worse climate
Robot employment
Extra opportunities Existential risks
Benefits
individuals
Threatens
society
Positive
feedback

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Enhancing
humans
Extra intelligence
Extra health
Extra longevity
Extra experience
Disturbing
humanity
Worse terrorism
Worse surveillance
Worse climate
Robot employment
Benefits
individuals
Threatens
society
If we allow individuals to enhance
themselves
through smart R&D and free enterprise
– without government interference –
the world’s social problems will be
solved as a by-product
Alongside smart R&D and the power
of free enterprise, we also need
wise regulation and smart governance
1
2
And perhaps new social systems
Governments needn’t be corrupt

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http://www.digitaljournal.com/article/360347
The most important problem we are facing now, today… is
Robert Shiller,
Nobel prize winner for Economics,
14 October 2013
rising inequality

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http://www.washingtonpost.com/blogs/plum-line/post/theres-been-class-warfare-for- the-last-20-years-and-my-class-has-won/2011/03/03/gIQApaFbAL_blog.html
There’s been class warfare going on for the last 20 years, and my class has won. We’re the ones that have gotten our tax rates reduced dramatically
Warren Buffett,
Investor, “Sage of Omaha”,
2011
Top 400 taxpayers
Average income
Tax rate
1992
$40M
29%
2010
$227M
21%

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http://www.theprogressivesinfluence.com/2014/02/the-nations-uber-wealthy-are- revolting.html

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http://www.newyorker.com/news/john-cassidy/pikettys-inequality-story-in-six-charts
http://piketty.pse.ens.fr/files/capital21c/en/pdf/F0.I.1.pdf
http://eml.berkeley. edu/~saez/saez- UStopincomes- 2012.pdf
Thomas Piketty

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http://www.economist.com/news/finance-and-economics/21631129-it-001-who-are- really-getting-ahead-america-forget-1
“The really, really rich get much, much richer”
“The 16,000 families making up the richest 0.01%, with an average net worth of $371M, now control 11.2% of total wealth—back to the 1916 share, which is the highest on record”

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Positive
feedback
cycle
The three inequality questions
1.Is inequality really a problem?
–Or is it just a perceived problem?
2.Is powerful new technology likely to make the problem worse?
–For example, via adverse positive feedback cycles?
–What kind of scenarios are credible for the future?
3.What can be done to avoid escalating inequality?
–Roles of politics, philosophy, and (yes) technology?

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The problems with inequality
1.Is inequality really a problem?
–Or is it just a perceived problem?
A.A more unequal society is worse for everyone
B.Equality of opportunity is declining too
–“The disappearing middle class”
C.A more unequal society is more explosive
–And technology risks making it even more explosive
Positive
feedback
cycle

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http://www.equalitytrust.org.uk/resources/our-publications/spirit-level-slides
http://www.theguardian.com/books/2010/aug/14/the-spirit-level-equality-thinktanks

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http://www.thersa.org/events/video/archive/rsa-debates-the-spirit-level
“Kate Pickett,
Richard Wilkinson, Peter Saunders, and Chrisopher Snowdon debate the influential book The Spirit Level and ask whether the benefits of egalitarianism can be statistically proven”

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http://www.washingtonpost.com/blogs/wonkblog/wp/2013/12/04/the-best-speech- obama-has-given-on-the-economy/
…I believe this is the defining challenge of our time
4 December 2013
A dangerous and growing inequality… has jeopardized middle-class America’s basic bargain:
– that if you work hard,
you have a chance to get ahead
While we don’t promise equal outcomes, we have strived to deliver equal opportunity – the idea that success doesn’t depend on being born into wealth or privilege, it depends on effort and merit.

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http://www.technologyreview.com/featuredstory/531726/technology-and-inequality/

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http://owsposters.tumblr.com/post/11688983653/middle-class-family-an-endangered-species

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http://www.washingtonpost.com/blogs/wonkblog/wp/2013/12/04/the-best-speech- obama-has-given-on-the-economy/
4 December 2013
The problem is that alongside increased inequality, we’ve seen diminished levels of upward mobility in recent years.
A child born in the top 20% has about a 2-in-3 chance of staying at or near the top.
A child born into the bottom 20% has a less than 1-in- 20 shot at making it to the top.
He’s 10 times likelier to stay where he is.

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The problem isn’t that we have inequality.
Some inequality is intrinsic to any high-functioning capitalist economy. The problem is that inequality is at historically high levels and getting worse every day…
Unless our policies change dramatically, the middle class will disappear, and we will be back to late 18th-century France. Before the revolution.
And so I have a message for my fellow filthy rich, for all of us who live in our gated bubble worlds:
Wake up, people. It won’t last.
If we don’t do something to fix the glaring inequities in this economy, the pitchforks are going to come for us.
No society can sustain this kind of rising inequality. In fact, there is no example in human history where wealth accumulated like this and the pitchforks didn’t eventually come out. You show me a highly unequal society, and I will show you a police state. Or an uprising.
http://www.politico.com/magazine/story/2014/06/the-pitchforks-are-coming-for-us-plutocrats-108014.html
Nick Hanauer

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http://www.dailymail.co.uk/news/article-2541541/Google-hiring-security-guards-protect-work-buses-San- Francisco-following-protests-tech-workers-driving-city-rents.html

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Locking in advantage: 5 factors
1.Capital growth exceeds economic growth (r > g: Piketty)
–More money -> investment -> even more money
2.Education
–More money -> better education -> better career -> more money
3.“Winner takes all”
–Better skills -> disproportionately higher reward

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Purchased by Facebook in April 2012
With 13 employees
And 100 million registered users
For approx $1 billion in cash and stock
Launched in October 2010
Sociable
Usable
Winner takes a larger reward
Compare Kodak
1997 valuation $30B
86,000 employees
2,000x productivity?!

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Purchased by Facebook in April 2012
With 13 employees
And 100 million registered users
For approx $1 billion in cash and stock
Launched in October 2010
Compare Kodak
1997 valuation $30B
86,000 employees
2,000x productivity?!
Created seven billionaires!
Each with a net worth ten times greater than George Eastman!

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Purchased by Facebook in Feb 2014
With 55 employees
And 420 million active users
For approx $19 billion in cash & stock
Launched in March 2009
Sociable
Usable

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“Winner takes all”: The Second Machine Age
Gold medal >> Silver medal
1.The digitization of more and more information, goods, and services
2.The vast improvements in telecommunications and transport
–The best products can be used in every market
3.The increased importance of networks and standards
–New capabilities and new ideas can be combined and recombined more quickly
http://www.secondmachineage.com/
Erik Brynjolfsson and Andrew McAfee, MIT

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Steve Jurvetson
Managing Director, Draper Fisher Jurvetson Venture Capitalist investor in Hotmail
“It just seems so obvious to me [that] technology is accelerating the rich-poor gap…”
“The elephant in the room, stomping around, banging off the walls”

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Locking in advantage: 5 factors
1.Capital growth exceeds economic growth (r > g: Piketty)
–More money -> investment -> even more money
2.Education
–More money -> better education -> better career -> more money
3.“Winner takes all”
–Better skills -> disproportionately higher reward
4.Technology to enhance your health (body power)
–Fitter -> work more effectively -> better rewards
5.Technology to enhance your intelligence (brain power)
–Smarter -> work more effectively -> better rewards

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Accelerating technology
Reduces prices
Increases inequality
Positive
feedback
Creates practical abundance

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http://www.businessinsider.com.au/mary-meekers-2014-internet-presentation-2014-5

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http://www.computerworld.com/slideshow/detail/143723#slide2
128MB
128GB

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Source: “Exponential Organizations”
exponentialorgs.com
http://www.slideshare.net/ vangeest/exponential- organizations-h

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exponentialorgs.com

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exponentialorgs.com

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Examples of rate of change
Technology
Average cost for equivalent functionality
Scale
3D printing
$40,000 (2007) to $100 (2014)
400x in 7 years
Industrial robots
$500,000 (2008) to $22,000 (2013)
23x in 5 years
Drones
$100,000 (2007) to $700 (2013)
142x in 6 years
Solar energy
$30 per kWh (1984) to $0.16 per kWh (2014)
200x in 20 years
3D LIDAR Sensors
$20,000 (2009) to $79 (2014)
250x in 5 years
DNA genome seq
$10,000,000 (2007) to $1,000 (2014)
10,000x in 7 years
BCI neuro devices
$4,000 (2006) to $90 (2011)
44x in 5 years
Full body med scan
$10,000 (2000) to $500 (2014)
20x in 14 years
http://www.slideshare.net/vangeest/exponential-organizations-h

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Accelerating technology
Reduces prices
Increases inequality
Positive
feedback
Creates practical abundance

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Four future scenarios
1.Inequality accepted – through “practical abundance” despite inequality
–Majority of people will become comparatively poorer, but goods will reduce in expense
–People remain relatively happy and acquiescent
–Even though the 1% have more abundance than everyone else
–People may spend lots of time in virtual worlds and soap operas
2.Inequality exploded: Pitchforks, revolution, and worse
–Some important goods will only be affordable by the super-rich
–Specialised healthcare? Rejuvenation technology?
–“Practical abundance” is not enough
–Growing societal tensions -> risk of explosions, pitchforks, horrific terrorism, WMD
3.Inequality controlled: Transhumanism for the 1%
–New tech will make some humans super-intelligent (brain-enhanced) & super-powerful
–Much bigger & faster differentiation than existing educational benefits
–That new ruling class will be able to suppress all dissent: super-effective police state
4.Inequality vanquished: Transhumanism for all
–Determined social pressure to ensure access to new technologies by everyone
–Don’t leave social evolution up to the forces of “free market liberalism”
–Improve on social organisation, just like we believe we can improve on bio-evolution

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Enhancing
humans
Extra intelligence
Extra health
Extra longevity
Extra experience
Disturbing
humanity
Worse terrorism
Worse surveillance
Worse climate
Robot employment
Benefits
individuals
Threatens
society
If we allow individuals to enhance
themselves
through smart R&D and free enterprise
– without government interference –
the world’s social problems will be
solved as a by-product
Alongside smart R&D and the power
of free enterprise, we also need
wise regulation and smart governance
1
2
And perhaps new social systems
Governments needn’t be corrupt

@dw2
Page 51
Appendix: What can be done to avoid escalating inequality?
•Deepen our awareness of impacts of social factors on alienation and initiative
–Sharpen our understanding of which kinds of inequality matter the most (and most need fixing)
–Local experimentation (at city, region, or country levels) will make us collectively wiser
–Expect a big role for a Basic Income Guarantee, especially as Technological Unemployment grows
•Encourage growth, where appropriate, of “collaborative commons” voluntary sector
•Elevate the power of “conscious capitalism” over “crony capitalism” & “vested interests”
–Encourage visions other than just pursuit of greater profit (“man cannot live by bread alone”)
–Enable societies to adopt “massive transformational purpose” (MTP – term used by Singularity Univ)
–A good MTP could be something like “transhumanism for all”
•Re-invigorate democratic systems – Democracy 2.0 – building on success of e.g. MOOCs
–Better use of technology to involve more people at right times in relevant decision-making processes
–The blockchain tech (which underlies Bitcoin) can enable DAOs (Distributed Autonomous Orgs)
•Develop smart drugs and other systems that make us all (with our permission) not just smarter and stronger but also kinder and more empathetic
–With that new spirit, more people in the “1%” will be moved to champion inclusivity
–This is “inner transhumanism” as opposed to just “outer transhumanism”
http://dw2blog.com/2011/04/17/towards-inner-humanity/

Principal, Delta Wisdom
Chair, London Futurists
David Wood
@dw2
londonfuturists.com
deltawisdom.com
Technology and inequality
Recent history & future scenarios
Radical opportunity & radical risk

Technology and inequality

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