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An equation to ensure America survives the age of AI
April 10, 2019 | Financial Times | Elizabeth Cobbs.

Alexander Hamilton, Horace Mann and Frances Perkins are linked by their emphasis on the importance of human learning.

In more and more industries, the low-skilled suffer declining pay and hours. McKinsey estimates that 60 per cent of occupations are at risk of partial or total automation. Workers spy disaster. Whether the middle class shrinks in the age of artificial intelligence depends less on machine learning than on human learning. Historical precedents help, especially...... the Hamilton-Mann-Perkins equation: innovation plus education, plus a social safety net, equals the sum of prosperity.

(1) Alexander Hamilton.
US founding father Alexander Hamilton was first to understand the relationship between: (a) the US's founding coincided with the industrial revolution and the need to grapple with technological disruption (In 1776, James Watts sold his first steam engine when the ink was still wet on the Declaration of Independence)-- Steam remade the world economically; and (b), America’s decolonisation remade the world politically......Hamilton believed that Fledgling countries needed robust economies. New technologies gave them an edge. Hamilton noted that England owed its progress to the mechanization of textile production.......Thomas Jefferson,on the other hand, argued that the US should remain pastoral: a free, virtuous nation exchanged raw materials for foreign goods. Farmers were “the chosen people”; factories promoted dependence and vice.....Hamilton disagreed. He thought colonies shouldn’t overpay foreigners for things they could produce themselves. Government should incentivise innovation, said his 1791 Report on the Subject of Manufactures. Otherwise citizens would resist change even when jobs ceased to provide sufficient income, deterred from making a “spontaneous transition to new pursuits”.......the U.S. Constitution empowered Congress to grant patents to anyone with a qualified application. America became a nation of tinkerers...Cyrus McCormick, son of a farmer, patented a mechanical reaper in 1834 that reduced the hands needed in farming. The US soared to become the world’s largest economy by 1890. Hamilton’s constant: nurture innovation.

(2) Horace Mann
America’s success gave rise to the idea that a free country needed free schools. The reformer Horace Mann, who never had more than six weeks of schooling in a year, started the Common School Movement, calling public schools “the greatest discovery made by man”.....Grammar schools spread across the US between the 1830s and 1880s. Reading, writing and arithmetic were the tools for success in industrialising economies. Towns offered children a no-cost education.......Americans achieved the world’s highest per capita income just as they became the world’s best-educated people. Mann’s constant: prioritise education.

(3) Frances Perkins
Jefferson was correct that industrial economies made people more interdependent. By 1920, more Americans lived in towns earning wages than on farms growing their own food. When the Great Depression drove unemployment to 25 per cent, the state took a third role....FDR recruited Frances Perkins, the longest serving labour secretary in US history, to rescue workers. Perkins led campaigns that established a minimum wage and maximum workweek. Most importantly, she chaired the committee that wrote the 1935 Social Security Act, creating a federal pension system and state unemployment insurance. Her achievements did not end the depression, but helped democracy weather it. Perkins’s constant: knit a safety net.

The world has ridden three swells of industrialisation occasioned by the harnessing of steam, electricity and computers. The next wave, brought to us by AI, towers over us. History shows that innovation, education and safety nets point the ship of state into the wave.

Progress is a variable. Hamilton, Mann and Perkins would each urge us to mind the constants in the historical equation.
adaptability  Alexander_Hamilton  artificial_intelligence  automation  constitutions  disruption  downward_mobility  education  FDR  Founding_Fathers  Frances_Perkins  gig_economy  historical_precedents  hollowing_out  Horace_Mann  Industrial_Revolution  innovation  innovation_policies  James_Watts  job_destruction  job_displacement  job_loss  life_long_learning  low-skilled  McKinsey  middle_class  priorities  productivity  public_education  public_schools  safety_nets  slavery  steam_engine  the_Great_Depression  Thomas_Jefferson  tinkerers 
april 2019 by jerryking
Citigroup CEO says machines could cut thousands of call centre jobs
February 17, 2019 | Financial Times | Laura Noonan and Patrick Jenkins in Dublin.

Citigroup chief executive Mike Corbat has suggested that “tens of thousands” of people working in the US bank’s call centres are likely to be replaced by machines that can “radically change or improve” customers’ experience while cutting costs.

Mr Corbat, who runs America’s fourth-largest bank by assets, made the comments in an interview with the Financial Times in which he also ruled out Citi’s involvement in any wave of US banking consolidation triggered by the $66bn SunTrust-BB&T merger and justified its continued presence in China.

Under pressure to bring its cost base in line with peers, Citi executives have been upfront about the impact of technology on their 209,000-strong global workforce, including last summer’s warning that as many as half of the 20,000 operations staff in its investment bank could be supplanted by machines.

Mr Corbat’s latest comments are the most explicit the company has been on how the $8bn a year Citi spends on technology could transform its vast consumer bank, which serves 100m customers across 19 markets.

“When you think of data, AI [artificial intelligence], raw digitisation of changing processes, we still have.....
artificial_intelligence  automation  call_centres  CEOs  Citigroup  layoffs  job_destruction  job_loss 
february 2019 by jerryking
What the Tax Bill Fails to Address: Technology’s Tsunami -
DEC. 20, 2017 | The New York Times | Farhad Manjoo.

Manjoo posits that the Republican tax bill is the wrong fix for the wrong problem, given how tech is altering society and the economy....The bill (the parachute) does little to address the tech-abetted wave of economic displacement (the tsunami) that may be looming just off the horizon. And it also seems to intensify some of the structural problems in the tech business, including its increasing domination by five giants — Apple, Amazon, Microsoft, Facebook and Alphabet, Google’s parent company — which own some of the world’s most important economic platforms.....some in Silicon Valley think the giants misplayed their hand in the legislation. In pursuing short-term tax advantages, they missed a chance to advocate policies that might have more broadly benefited many of their customers — and improved their images, too......This gets back to that looming tsunami. Though many of the economy’s structural problems predate the last decade’s rise of the tech behemoths, the innovations that Silicon Valley has been working on — things like e-commerce, cloud storage, artificial intelligence and the general digitization of everything and everyone around you — are some of the central protagonists in the economic story of our age.

Among other economic concerns, these innovations are implicated in the rise of inequality; the expanding premium on education and skills; the decimation and dislocation of retail jobs; the rising urban-rural divide, and spiking housing costs in cities; and the rise of the “gig” economy of contract workers who drive Ubers and rent out their spare bedrooms on Airbnb....technology is changing work in a few ways. First, it’s altering the type of work that people do — for instance, creating a boom in e-commerce warehouse jobs in large metro areas while reducing opportunities for retail workers in rural areas. Technology has also created more uncertainty around when people work and how much they’ll get paid.
Farhad_Manjoo  preparation  job_loss  job_displacement  Silicon_Valley  tax_codes  corporate_concentration  platforms  income_inequality  short-sightedness  e-commerce  cloud_computing  artificial_intelligence  gig_economy  precarious  automation  uncertainty  universal_basic_income  digitalization  Apple  Amazon  Netflix  Microsoft  Facebook  Alphabet  Google  inconsistent_incomes  Big_Tech  FAANG 
december 2017 by jerryking
Tills and skills: How to prepare America’s retail workers for technological change | The Economist
May 12th 2017

America’s retail industry is huge: it employs 15.9m workers, who represent one in nine American jobs. It is also undergoing wrenching change, as e-commerce eats into sales. There is no more pressing test of society’s ability to cope with technology’s impact on work....For all the benefits that online retailing brings to consumers, it is causing immense pain to offline rivals. Last year 4,000 American stores closed; this year more than twice that number may shutter. Standard & Poor’s, a rating agency, expects retail defaults this year to outnumber those in 2009, at the height of the global recession. Some formats—discount stores, groceries, high-end malls—will continue to thrive. But many will shrink. The industry has shed 50,000 net jobs since January. Department stores may need to close more than 800 stores to reach the productivity levels of 2006. Many outlets are looking for ways to cut labour costs by embracing automation....The problems faced by America’s retailers are particularly acute because there are so many of them: shopping centres eat up five times more space per person than in Britain. But the threat posed by technology is familiar to workers elsewhere. In Japan, online sales menace small, specialty shops that account for roughly half of sales. The Eurasia Group, a consultancy, reckons that 192m retail jobs around the world are vulnerable to automation.....A 21st-century approach to careers advice would see employers across industries identify transferable skills: rather than thinking of e-commerce as a natural move for shop assistants, their ability to handle customers might make them more suitable for roles in health care, for example. Armed with such advice, people in at-risk industries such as retailing could be given learning accounts, topped up by government, that can be used to pay for new skills. Benefits could be made more portable, making it easier for workers to switch between full-time employment and the gig economy as circumstances change.
job_destruction  job_displacement  job_loss  e-commerce  store_closings  retailers  Standard_&_Poor’s  grocery  shopping_malls  department_stores  oversaturation  safety_nets  automation  technological_change  market_saturation  transferable_skills 
may 2017 by jerryking
London lives again: Inside the revival in Ontario’s rust belt - The Globe and Mail
JOHN IBBITSON
LONDON, ONT. The Globe and Mail Last updated: Friday, Feb. 05, 2016

Synergies between the education sector and the private sector lie at the very heart of Southwestern Ontario’s future. By incubating, encouraging and then feeding workers into London’s emerging high-technology sector, Western and Fanshawe are doing for their city what the University of Waterloo has long been doing for Kitchener-Waterloo’s computer-based industries and the University of Guelph is doing for bio-technology in Guelph.
John_Ibbitson  rust_belt  manufacturers  job_loss  revitalization  Southwestern_Ontario  entrepreneur  automotive_industry  UWO  Kitchener-Waterloo  synergies 
february 2016 by jerryking
U.S. political debate stuck in the past -
Aug. 30 2012 | The Globe and Mail | CHRYSTIA FREELAND.

The argument between the Democrats and the GOP about the size of the state comes with little regard for the economic realities of this era. Like generals fighting the last war, U.S. politicians are solving the economic challenges of the past century....Thanks to smart machines and global trade, the well-paying, middle-class jobs that were the backbone of Western democracies are vanishing. The paradoxical driver of this middle-class squeeze is not some villainous force – it is, rather, the success of the world’s best companies, many of them American (i.e. Big Tech, the major platforms)....the knottiest economic problem of our time: Figuring out how to manage an economy whose engines of growth are enriching the few but squeezing the many....It took more than the spinning jenny or the steam engine to transform local, agrarian, family-based communities into national, urban, individualistic ones. New political and social institutions will be needed to midwife the latest shift into global and virtual communities. Inventing those institutions is difficult, and talking about them can be frightening, but that is the political conversation the Western world should be having.
Big_Tech  Chrystia_Freeland  Campaign_2012  globalization  Outsourcing  institutions  middle_class  job_destruction  job_displacement  job_loss  institution-building  downward_mobility  hollowing_out  backward_looking 
august 2012 by jerryking

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