Artificial intelligence and the U.S. economy: Finding the right balance between efficiency and risk
R. David Edelman, Director, Massachusetts Institute of Technology
Internet Policy Research Institute
GRAPHIC: [The unholy trinity of job displacement]
We all know there has been pressure on industrial and manufacturing jobs (and that’s been true for a century) yet nothing has materialized. We’ve dealt with major labor shocks in the economy before, but it is also undeniable that increasingly the combination of what I call the “unholy trinity of job displacement,” which is machine learning, computer vison, and robotics coming together allows these machines to act in real space more like humans.

GRAPHIC: [Machine learning. Computer vision. Robotics.]
That is going to be a game-changer for a lot of spaces that go well beyond just the manufacturing industry. Think about the robot security guard, which is now a product that can be purchased and can patrol the hallways or parking garages. Think about the elder care robot that is coming down the pike now, and can actually have tremendously positive impacts because we, in most developed economies, have a critical shortage of homecare workers. As much as we would like to think that only redundant, blue collar jobs will be affected, the truth is the white collar and corner office jobs are increasingly under pressure. When you have chatbot robots that will fight your parking tickets for you, you suddenly have a legal job that’s going to have pressure on it.

GRAPHIC: [The government’s role.]
I think there is always going to be a delicate balance between government wanting to get out of the way and government making sure that the basic laws of competition, fairness and consumer protection stay in place. The key is finding the right balance between making sure that government is aware enough of the challenges that technology is posing. 

GRAPHIC: [Finding the right balance.]
Take an area like autonomous vehicles.  Last year, over 41,000 Americans died on the highway. Now, autonomous vehicles have the potential to eliminate that. They have the potential to bring down that number dramatically, or maybe even bring it to zero. They can help us get over one of the greatest inefficiencies of car design, and that is they rely on the individual. Does that mean that the government’s role should be to make it illegal for you to drive your car? Absolutely not.  But I would argue that if you could make vehicles 50 times safer and allow you to do other things during your commute, that ends up being a real social good. 

GRAPHIC: [The right level of risk.]
Government can take some really important steps in allowing the right level of risk (a little bit of managed risk), so these machines can get better and better at their job.
If government just said, “This technology has to stop until we can prove that it’s a hundred times better than any person,” that technology would never materialize. That’s the kind of complex, ethical, public policy decision that we need to rely on our government to make— with our input.

GRAPHIC: [Conflict in the international system.]
What you’re seeing in the last 10 years is what I call international coercion 2.0. You are seeing this confluence of dependence on digital infrastructure, combined with the unrelenting state of conflict in the international system, result in some real incentives and new mechanisms that States have to disrupt one another. Actions that previously might have resulted in some economic sanctions or maybe even moving troops from one place to another, increasingly are playing out online. Companies are finding themselves in the crosshairs of geopolitical conflict. That’s a very challenging place to be because how any company could be asked to rise to the level of a nation state?  And yet they are. You’re seeing a lot of industries come together to game-out. What is the worst case scenario? What would a foreign adversary do to try to disrupt our system— and not just one system but our entire way of doing business?  
The challenge that we have to confront is not just the threat that we used to face from rogue hackers or “folks in basements,” but now organized nation states. That’s a paradigm shift for international relations, and it’s also going to be a major challenge for industries that depend on infrastructure. There’s going to need to be some collective investment in securing that infrastructure to make sure that it doesn’t become the soft underbelly of our economy, and in turn, our national security.

GRAPHIC: [The future of the internet.]
There are two possible internets of the future.
One of them is the internet that we have come to know and love— an internet environment that has been unitary, global, whole and interoperable for as long as it has existed. There are tremendous pressures on that status quo right now.
The second vision of what the internet might actually look like is a bunch of regional intranets. Your computer from one region doesn’t work in another. Your phone from one country isn’t interoperable with the phone network of another. Software is only permissible for use if you’re behind the great firewall of China (or if you’re on the other side of it), or in Europe (this might surprise people).

GRAPHIC: [Privacy Regulation.]
As Europe moves towards becoming an aspirational global regulator of privacy, among other things, they’re forcing companies to house their data resident within Europe. There might be great public policy reasons behind that for privacy, but it’s a slippery slope, and it’s one that could absolutely result in some growing gaps in the global digital supply chain as we’ve known it. Add on top of that some of the trade disputes that we’ve seen recently, many of which fix themselves around technology and the global technology supply chain, and you have a recipe for a real challenge for this global status quo that we’ve enjoyed until now.
GRAPHIC: [Charles Schwab    Own your tomorrow.]

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