Transcript:
You can't open social media right now without someone telling you AI is about to end the world. I think if this technology goes wrong, it can go quite wrong. Take over from humanity. Yes, that's a possibility. Technology is that can kill us quickly and reliably. And someone else telling you it's about to end work. My prediction is that work will be optional. We still need humans? Not for most things. Next steps is going to be these amazing tools that enhance our almost every endeavor we do. Normally, I'd write that off as hype, but I spent 15 years as a software engineer. And I've watched this technology change my profession faster than anything I've seen. And if it keeps getting better, the optimists say we're headed for a world where machines do almost all of the work. And everything gets so cheap, it's basically free. No bills, no jobs you hate, maybe no money at all. So I want to test that. I'm going to give the optimists everything they want one step at a time. And after each step, ask one question. Do we still need money? At the end, I'll tell you where I landed. Start with the easy one. Say AI and robots make food, clothes, energy, and housing incredibly cheap. They don't have to be free. Think about tap-wile. It isn't free, but you never stop to ask if you can afford another class. It's cheap enough that it doesn't register. Now imagine most of life working that way. Do we still need money? For everyday stuff, not really. When there's enough for everyone, there's nothing to fight over. But some things can't be made cheap. Say everyone can have a beautiful home. Everyone still can't have a house on the hill overlooking the Pacific. You could build more coastline, Dubai already builds islands. But build a beach nicer than Malibu, and Malibu just becomes the second best address. You can make more beaches, but you can't make more best. Ferrari figured that out a long time ago. Enzo Ferrari liked to say they'd always build one less car than the market wants. The scarcity is part of what you're buying. Or take the Beatles. In 2023, they released a new song, Now and Then. AI pulled John Lennon's voice off an old demo tape, and the song won a Grammy. People cared because it was really John. AI could make a thousand songs that sound like him, and none of them would be him. So say 10 people want that house on the cliff. Today we'd sell it to whoever pays the most. That's what money does. It decides who gets the thing there isn't enough of. We could do it another way, hold a lottery, give it to whoever needs it most, or whoever's contributed the most, let a committee decide. But none of that makes the problem go away. 10 people still want one house. And every option needs someone deciding what counts as need. What counts as contribution, or who sits on the committee. Do we suddenly need money? We need money or something that does its job. And whoever runs that system has the power. Getting rid of money doesn't get rid of power, it just moves it. And here's the part the optimists skip. The machines making all of this stuff belong to someone. Picture a company with 10,000 employees. Every two weeks 10,000 paychecks go out and turn into rent, groceries, and dinners out. That paycheck is how you get your share of everything else. Now the company automates. It makes just as much maybe more with 500 people. The other 9,500 paychecks stop. Machines don't take salaries. So where does that money go? To whoever owns the machines. Now people have been predicting machines would end work for 200 years. And they've been wrong every time. Maybe this time is different and maybe it isn't. In 2024, Klarna said its AI was doing the work of 700 customer service agents. A year later it was hiring humans again. But even if the job survived, the question doesn't go away. The economy could get better at making stuff and worse at sharing it. Both at the same time. Do we still need money? Yes. And it might matter more than ever. Because whoever owns the machines, collects what used to be your paycheck. Last step. Say AI does everything, including the hard stuff like inventing and researching. Nobody needs us to work at all. For most of history, there's been a simple deal. You do something useful and in return you get a share of what society makes. And when people were needed, they had leverage. After the Black Death killed a third of Europe, workers were suddenly scarce. England's rulers passed a law to keep wages from rising and that didn't work. Over the next century, wages roughly doubled. Being needed gave ordinary people power. We even have a modern preview of the opposite. Brunei is a tiny country floating on oil. Citizens get free health care, free education, and cheap housing. And they pay no income tax. Sounds like a dream. But who decides how oil money gets handed out? The Sultan, who's also Prime Minister and Finance Minister. Brunei hasn't had a national election since 1962. When a government doesn't need your work or your taxes, it doesn't have to listen to you. So what happens when none of us are needed? Do we still need money? Yes, because something will always be scarce. The difference is that the people who aren't needed anymore might not get a say in how it's handed out. So if AI does all the work, what is money for? Here's where I landed. We'll need money or something like it for as long as anything is scarce. And something always will be. AI can push scarcity into a smaller and smaller corner. It can't get rid of it. A future of abundance gets sold as a production problem. Make enough stuff and everything works out. I think making the stuff might be the easy part. The hard part is deciding who gets it and making sure ordinary people still have a say when they're no longer needed. So the next time someone tells you AI is going to make everything abundant, ask three questions. Who owns the machines? Who decides who gets what? And what gives the rest of us a claim? Because even in a world where machines can give almost everyone, almost everything they need, 10 people can still want something only one person can have. And whether we settle that with dollars, luck, status or politics, someone still has to decide who gets it.
