Cern Basher
Here are some key highlights from Tony Seba's post "This Time, We Are The Horses" on Humanoid Robots (see his original post below) - there are so many key insights... here are a few:
1) "This time, we are the horses: the disruption of labor by humanoid robots" - This is difficult to hear, but well said. For the first time in human history we will have something that could, eventually, do all physical tasks better than a human.
2) "Just as internal combustion engines gave automobiles the capability to disrupt horses, a convergence of technologies that together create what we call a labor engine is what gives humanoid robots the capability to disrupt human labor." - Flesh & blood cannot compete with engines.
3) "Over the next 15-20 years, humanoid robots will disrupt human labor throughout hundreds of industries across every major sector of the global economy. The disruption of labor will be among the most profound transformations in human history, and therefore simultaneously represents one of the greatest opportunities and greatest challenges our civilization has ever faced." - All powerful new technologies are both exciting and scary at the same time (e.g. nuclear).
4) "Throughout history, every time technology has enabled a 10x or greater cost reduction relative to the incumbent system, a disruption has always followed. Each dollar spent on an automobile or an LED light bulb or a digital camera delivers more than 10 times the utility of each dollar spent on a horse, incandescent bulb, or film camera respectively." - We should expect it to be no different this time.
5) "At first, humanoid robots will only be able to perform relatively simple tasks. But with each day that passes, their capabilities will grow, until by the 2040s they will be able to do virtually anything a human can do – and much more besides. Remember: humanoid robots today are the most expensive and least capable they will ever be." - We see bots walking awkwardly or working slowly and we think we have plenty of time - no, actually, we don't.
6) "Humanoid robots are what RethinkX calls a disruption from below. Initially, they will be cheaper per hour than hiring a human worker in many regions, but also less capable: slower, less competent, less adaptable. We have seen disruptions from below many times before (such as digital cameras), and the response from incumbents is predictable: they mock the new technology for being lower-performing while ignoring the rate at which the new technology gets both better and cheaper, until it is too late to respond and they face collapse." - Tony is absolutely correct - you can set your watch by the incumbents reaction.
7) "Electricity wasn’t just cheaper whale oil. Automobiles weren’t just faster horses. Farming wasn’t just more productive hunting and gathering. And the Internet wasn’t just an easier way to send letters, read newspapers, or listen to music... And humanoid robots won’t just displace human jobs. Instead, they will create an entirely new and vastly larger and more capable labor system. It is impossible to know in advance the full details of how the new labor system will differ from today, but the key feature is: the marginal cost of labor will rapidly approach zero." - Imagine everything we can do if the marginal cost of labor approaches zero!
8) "The disruption of labor is about tasks, not jobs... So long as humanoid robots are not sentient, they will not have jobs. They will only perform tasks. The disruption of labor, with all of its world-changing implications, can therefore only be understood with tasks as the correct unit of analysis, and tasks per hour per dollar as the corresponding cost-capability metric." - Tony is helping us think correctly about all this. Like all other tools - saws, hammers, drills, etc. - new tools only serve to make humanity more productive.
9) "Labor is an essential input into every link of every supply chain of every product and service across the entire global economy. That means as the cost of labor falls, so will the cost of everything else... We must expect and plan for a sweeping tide of supply-driven (NOT demand-driven) deflationary pressure across the entire global economy as a function of the disruption of labor by humanoid robots." - Yes that's right, and demand driven deflationary pressure also comes from population decline. Managing this deflationary wave will be critical for governments.
10) "The quality of virtually all manufactured goods will tend to improve, because the limits of skill and attention to detail that apply to humans do not apply to robots... Every humanoid robot will perform every task it is capable of performing, at the maximum quality it can perform it, every single time... The upshot from a consumer perspective is that quality will appear to be on the rise everywhere, all at once, with “cheap junk” quickly becoming a relic of a bygone era." - And the Dollar Store becomes a purveyor of quality merchandise.
11) "...labor has always remained a limiting factor of production, and up until now the quantity of available labor has been a function of population. And regions with more and cheaper labor have enjoyed a competitive advantage as a result. Humanoid robots fundamentally change the equation. Instead of growing only as fast as a human population, available labor can now grow as fast as humanoid robots can be built and deployed. The difference is explosive. Like a dam bursting, humanoid robots will unleash a torrent of productivity..." - GDP is largely a function of labor times productivity - expand both parts of the equation at the same time and potential GDP balloons.
12) "It takes almost twenty years and more than $100,000 to raise a child and prepare them to join the national workforce of a middle-income country. Humanoid robots, by contrast, can be added to the workforce as fast as they can be manufactured, and it is unlikely their unit cost will exceed that of an inexpensive car even at the very start of commercial deployment. This means that by 2035, for example, adding one million people to a nation’s workforce might cost $100 billion and take twenty years, whereas adding one million humanoid robots to its workforce might cost just $10 billion and take a single year." - If we think of babies just as future workers, then bots win. Of course, babies are also future consumers, so they are still critically important - go make babies!
13) "Today, the size of a nation’s army can only be a subset of its own population... Any humanoid robot capable of working in a productive capacity can also be deployed in a national security capacity, whether in a supporting or frontline role... This means that, for better or worse, any nation with a large robotic workforce is also a nation with a large robotic army." - This is accurate - there is a national strategic/defense element to this too - we cannot forget that.
14) "Humanoid robots are likely to be one of the most profitable physical product categories ever, by virtue of the sheer scale of their production numbers alone. Given the size of the global labor market together with latent demand that this technology will unlock, it is reasonable to expect the number of humanoid robots deployed to exceed 1 billion over the next two decades – and possibly much more." - Yes, I and many others have been discussing this. You may ignore us, but listen to Tony!
15) "It is now rational for societies devote a non-trivial fraction of their entire GDP to investment in humanoid robotics. Humanity has been in this sort of situation before. Many societies have built roads, plumbing for running water, electricity service, telephone service, and broadband internet service to every home and business. These basic services not only bring prosperity, but massively increase productivity too. Societies must now aim for robots in every home and business as well – and for exactly the same reasons." - This is a strong point. Critical infrastructure makes a nation powerful and productive. Add humanoid bots to the list.
16) "Moreover, history shows that although capital (in the form of facilities, machinery, and knowledge) have substituted and thus displaced labor time and time again, labor has nevertheless evolved to remain complementary to that capital. Counterintuitively, this has put upward pressure on the value of labor over time... In the near term, for perhaps a decade or so, humanoid robots will largely be deployed to meet demand for labor that is currently going unmet by humans – as opposed to directly displacing human workers from jobs they currently occupy. This will create a non-obvious and counterintuitive situation in which humanoid robots appear to be almost purely a force-multiplier for existing jobs and workers, rather than a threat to them... While true, and worthy of celebration, we must be aware this condition will not persist for long." - Yes, the bots will first soak up the unmet/unwanted tasks, then like a giant sponge will soak up the rest.
17) "This means the era of complementarity between labor and capital is coming to a close. “Work” will soon become something that only machines do. When the disruption of is labor is complete, we will need to rethink economics itself because fundamental notions like scarcity and exogenous total factor productivity will no longer hold. The labor engine (itself a new kind of “capital”) will become self-sustaining and self-expanding, and superabundance will become the rule rather than the exception. It is almost impossible to overstate how radical this transformation of the human condition will be. It will indeed be liberating to an extent that up until now has seemed almost unimaginable – purely the realm of utopian science fiction. But it also means widespread public concern about technological employment from AI and robotics remains entirely valid in the longer term, from perhaps the late-2030s onward. Without very thoughtful decision-making among leadership in every domain, and very likely a rethinking of the basic social contract across society itself, the destabilization caused by the disruption of labor could well be catastrophic." - And there's the risk and an opportunity for great leadership.
18) "...it will be very tempting for policymakers, industry leaders, and others to pretend that humanoid robotics will never cause an unemployment crisis – just as we have seen incumbents pretend that other disruptions throughout history pose no threat to the status quo. But this would be a terrible mistake, and would lead to enormous suffering and chaos when human labor markets do finally begin to collapse with no hope of recovery. It would also be a mistake to ban humanoid robots “to preserve jobs” (although we are almost certain to see calls for this), because this would lead to a vicious cycle of diminishing competitiveness, prolonged scarcity, economic stagnation, and ultimately societal ills ranging from poverty to civil unrest and much else." - We simply must find a way to thread this needle.
19) "Like light bulbs, telephones, computers, and many other disruptive technologies, the demand for humanoid robots will be enormous. At the beginning of the disruption, when demand still vastly exceeds supply, no single producer will be able to capture all markets. We should therefore expect to see the same pattern that has emerged in previous disruptions: many companies, both startups and incumbents, will rapidly develop humanoid robot offerings for wide range applications, targeting dozens or hundreds of market niches, using a variety of different business models. So, even though the leading technology developers in the humanoid robot sector might limit their humanoid robots to deployment in factories or to lease-only user agreements, there will be so much demand for humanoid robots that other firms lower on the leaderboard will still enjoy huge opportunities to step in and target other markets with other business models as well. For example, if a leading firm decides to only lease its robots for use in factories, one or more other firms will seize the opportunity to sell robots for use at home – even if their robots are somewhat less capable." - I completely agree with Tony - this is not likely to be a winner take all category - it's just too vast and too varied.
20) And lastly: "Above all: protect people, not jobs, firms, or industries. In other disruptions throughout history, we have seen incumbent interests turn to their governments for protection against the new technologies. These protections can take the form of subsidies and handouts to the old industries, regulations and prohibitions that impede new industries built upon the new technologies, and bailouts when the old industry inevitably collapses. Almost invariably, the benefits of these protections accrue only to the privileged few who own and control the incumbent interests, rather than to the individuals and communities who lose their livelihoods because of the disruption. To avoid making this same mistake, which could prove catastrophic at the scale of the entire global labor market, we must rethink the relationships between a nation’s population and its economic output, and get ready to transform society itself." - Will we have these discussions and prepare ourselves? I'm hopeful.
5/6/24, 2:47 PM.
https://x.com/cernbasher/status/1787554886600536566https://www.rethinkx.com/blog/rethinkx/the-disruption-of-labour-by-humanoid-robots 
