Interesting Times
Life is changing fast as we find new purpose
Many downplay or overate the effect of Artificial Intelligence (AI), yet the one certainty is it’s coming. AI will affect everything, and profoundly alter our lives, for better or worse depending on your perspective.
Real World AI
Performing physical tasks is an order of magnitude more difficult than compiling text with large language models. Realistically only a relatively few deep tech companies have the resources to synergize the necessary software and hardware to emulate physical human skills.
“AI5 [processor] will punch far above its weight, because the entire Tesla AI software stack is designed to make maximally effective use of every circuit. We co-signed our AI software and hardware. Bear in mind that AI5, while it can be used for training in data centers, is primarily optimized for AI edge compute in Optimus and Robotaxi.” ~ Elon Musk
As Elon suggests, Tesla’s AI5 processor will put them at the forefront of physical AI applications: -
Robotaxi – driverless cabs capable of operating day and night in any conditions.
Optimus – androids capable of any physical task performed by humans.
Digital Optimus – able to manage the operations of entire companies.
Demand for AI chips will increase exponentially as AI learns more tasks and becomes more widely used, hence Tesla will fabricate their own silicon to ensure ample supply.
“Terafab Project launches in 7 days” ~ Elon Musk
Realistically the transition to AI will be gradual at first then accelerate until adopted in most areas.
AI Transition
Transport will be first affected, because driverless electric vehicles are more reliable and less expensive to operate. For example, robotic taxis don’t overcharge, infect or otherwise abuse passengers. In addition, Tesla starts production of heavy goods semis in a few months, essentially bracketing the road transport market.
The applications for humanoid robots go far beyond factories. Any organization could dispatch androids on automated vehicles to wherever needed, such as road works, grid repair, harvesting etc. Over time manual labor will cease as an area of employment, just as we replaced horsepower with mechanical energy.
Likewise agentic AI is capable of far more than company management. All levels of government process forms, provide regulatory guidance and progress legal matters, areas where AI is particularly capable. In the medium term, government will have little option except to adopt less expensive AI due to reduced tax revenues.
Good and Bad
During the transition period unemployment benefit will be extended until it effectively becomes Universal Basic Income (UBI) for anyone who needs it. People require money to survive and the government’s role is to serve the people. AI augmented companies, wealthy individuals and anyone still in employment will pay for UBI through taxes.
Realistically the divide will widen between ordinary people and those with generational wealth, creating two distinct classes in one country. However, anyone on benefits will have freedom to pursue their own interests, such as arts, hobbies or families. Likely these interests will be more rewarding and result in some other benefit through barter or remuneration, effectively becoming casual employment.
Healthcare will be universal, due to reduced costs from AI and general lack of health insurance. Patients will be stabilized on automated medic EVs, CT scanned on admission to AI managed hospitals, immediately diagnosed by agentic doctors, then receive fast treatment from robotic nurses or sent to robotic surgery. Expect personalized treatments to become the norm, thanks to the massive resource of AI.
No doubt some politicians will oppose broader benefits then experience difficulties being reelected when the employed/wealthy become a minority. Then the choice comes down to extreme authoritarianism or realpolitik…
Life Hack
Some will happily dispense with boring, mundane or menial work and embrace personal development. However, many will appreciate the longterm benefits of generational wealth and plan for the transition. Tech companies are tadpoles compared to what they will become, if they win the AI race. Essentially anyone who makes a concerted investment in an AI venture now could gain generational wealth, assuming that venture becomes an AI winner. Unfortunately there will be more losers than winners in the AI race, so deep unbiased research into these ventures is essential before exploiting the current investment opportunity. In any gold rush, people who sell picks and shovels make a reasonable return, but the real money was made by those who find gold. For example, during the internet boom hardware was relatively common but good software was rare, so became the real gold...
In Conclusion
Work will soon become optional for many, allowing them to explore more rewarding pastimes. However, employment will still exist for those who genuinely enjoy it and exceptionally able.
AI adoption will start small then surge into a tsunami, creating incalculable wealth. Eventually we might even shrug off capitalism as we enter an age of unlimited abundance.
Fear Optimus! Did no one watch iRobot or read the book?
I see those in the know are saying that the speed of progress, now that AI is self-generating its own code (Claude), is going to be faster than anyone expects. They want to skip UBI and go for UHI (universal High Incomes). Add into the mix the rapid advances being made to 3d Printing, and it's not looking good for the traditional economies that rely on money going into the system and flowing up to governments