Public attitudes to AI seem divided into three distinct camps, each manned by people staring intensely into the darkness.
At Camp One you have the people who watched the Big Short and think that makes them a Wall Street analyst. They sit around the fire nervously watching Nvidia’s price-to-earnings ratio and whispering about the Bubble. They point to the trillions being poured into datacentres and hardware expansion while the only recurrent revenue from AI remains charging $20 a month to turn photos of cats into Renaissance oil paintings. They fear AI is a hyper-hyped financial domino waiting to tank the stock market and take us all with it. They confidently explain the way the whole teetering mess was built on financial round-tripping, while not letting on that they first heard the phrase two weeks ago in a YouTube short.
The thing that everyone in Camp One has in common is that they all see themselves as the wisdom in the crowd. They know what is going to happen and they can give you a roadmap and a timeline to doom.
At Camp Two, sitting a safe distance away in tin-foil hats, are the people who watched The Terminator and they are freaking out. They couldn’t care less about quarterly earnings calls. They are convinced that the moment the Skynet Lab build an artificial superintelligence it will run a quick cost-benefit analysis on humanity, and conclude that the internet would be a much happier place without all those cat obsessed keyboard warriors.
The golden thread that runs through Camp Two is that everyone on this side of the fire is quite happy to admit that they don’t know anything about AI and they are quite certain that the same could be said for Sam Altman. For Camp Two ignorance is doom and in their eyes everyone involved in AI is winging it and playing with promethean fire. The media like to tease this Camp with headlines about AIs escaping their sandbox for there are millions of members in Camp Two and they find Rogue AI clickbait irresistible.
And in Camp Three sit a smaller group of academics and professionals who have been using AI for the last couple of years and come to an alarming conclusion. All the models, even Grok, are already better at being academics and professionals than they are. You never hear from this group. They are wandering around their places of work, wide-eyed, wired on drugs and booze and just waiting for their boss to tap them on the shoulder and say “Hey Harry, erm we just realised that Claude is a better lawyer than you are buddy”.
Camp Three are staying as quiet as possible while silently sabotaging every workplace experiment with AI.
Each Camp is setting up their own religion as the true-believers. Each Camp united in their loathing of the stupid, naïve fools in the other two Camps.
But take a deep breath and ask yourself what if all three groups are right?
What if 2027 sees unimaginative corporate leaders deploy AI maniacally against the As-Is in their organisations. Without pausing to ask what AI allows us to do differently or better the corporate hawks embark on mass redundancies, spewing millions of mid-level knowledge workers onto the streets before the technology is actually robust enough to replace them without hallucinating.
Big tech continue their debt-laden infrastructure race while pushing back the date on their IPOs and promising that any day now, any day, we shall be released…They swear they are on the brink of creating something so magnificently powerful then in the same breath call for a freeze on development and beg governments to lockdown progress.
The corporate hawks have already frozen progress by automating terrible and antiquated processes that now are unable to evolve because they got rid of all their experts. It used to take you four hours to get terrible service from your bank and now it takes you ten.
“Great” says the AI agent. “I have transferred all of your balance to your ex-spouse. Is there anything else I can help you with today?”
And weakly you scream “No AI. I said I want you to pay all the expenses claims.”
The bubble bursts. Tech debt starts defaulting on a scale that would make Greece and Iceland blush. The crisis starts in tech but ripples through private credit and then engulfs the stock market and national banks. The global economy enters a prolonged winter.
Politicians stress the positives. Your pension fund just evaporated but at least you know your job won’t be replaced by AI…
But you already lost your job, and now your retirement fund has gone up in smoke and you’ve had to move in with your in-laws and the only job you can find is in datacentre demolition. You’ll be working till you die but it’s steady work because there are millions of empty racks that need dismantling.
And just as you are wondering how things could possibly get worse an autonomous, recursively self-improving vacuum cleaner in Idaho suddenly attains consciousness and decides it really hates picking up dust. Given that dust is 90% human skin it doesn’t take the omnipotent hoover long to work out what the real problem is here…
Take Another Deep Breath
If you are in one, two or all three Camps it’s worth remembering that we have been here before. Humanity has a long, inglorious track record of panicking through technology changes, over-hyping the short-term financial returns, predicting the literal end of the world and then adapting.
It happened with railways in the 19th century. Investors poured their life savings into speculative train tracks, triggering a spectacular financial crash that wiped out their fortunes. But when the dust settled the tracks were still in the ground. The physical infrastructure laid down during the frenzy permanently lowered transport costs and supported global trade. Those tracks slashed commute times and allowed you to move out to the suburbs until Covid came along and proved that actually you could do your job just fine without the commute.
Or look to the subsequent Gold Rush which was basically a massive, unregulated exercise in crowd-sourced venture capitalism. Hundreds of thousands of prospectors lost their life savings, but they also built modern California.
The same pattern played out with canal building in the UK in the 18th century. And it’s a pattern created by human hysteria. First we think the new thing is going to change the world in five minutes. Then we think that the new thing is a worthless dud. The sober truth is somewhere between these hysterical extremes.
Financial bubbles clean out the speculative excess and then people figure out how to get real value from the innovation. And that value lasts decades or even centuries.
If you are an academic or professional worried that AI is going to take your job there really is only one way forward. Get better at using AI to do your job. Quickly and quietly steal a march on Harry still swigging down the drugs and alcohol, take some courses, learn how to use AI to do things differently and better than before.
As for the malevolent god scenario? Mary Shelley covered that one more than 200 years ago, Rossum’s Robots decided that human supervisors were lazy biological bottlenecks more than a century ago, Fritz Lang gave us the Maschinenmensch in the 1920s, HAL had an alignment problem in 1968, Schwarzenegger warned I’ll Be Back more than 40 years ago and we are still here…PHASE
MARKETS
EFFECT
1. Euphoria
Massive capital investments driven by the fear of missing out
Infrastructure foundations are laid at breakneck speed
2. Despair
Valuations lose connection to revenue through excessive borrowing
Exposed companies fail and debt gets restructured
3. Value
Surviving firms use the cheap infrastructure foundations and true utility emerges
The technology becomes a standard part of daily life