I have one question so far which i think touches a little bit on that. What do the stagnation and end of innovation days not recognize when they face that . The great stagnation, his argument has used this plateau. You are painting quite a different picture. Hes a super smart guy and we discussed it with him. He really inspired us to work on that first book, race against the machine. When we read his book because he was arguing we had run out of innovation and it was just no more good things, a few good things left to invent. Hanging around a place like mit media lab, we thought that cant possibly be true. Is this guy looking at the same economy we are looking at is the question we had. On the other hit some compelling data about the stagnation of meeting and, and that reinforced us to think hard about how this could be happening. And thats where we came up with this recognition that just because meeting income is stagnating, that doesnt mean innovation is stagnating. In fact, paradoxically if innovation speeds up, that can lead to a lot of people falling out if theyre not keeping up with their skills or organizations are not keeping up, and this dramatic reorganization of the economy can simultaneously be a symptom of Great Innovation and wealth creation, but also lead to stagnating meeting income. Its great to have fundamentally different worldview that we had then he had, which is that innovations, we dont think of them as lowhanging fruit. Thats the metaphor he uses as he says, we plucked most of the lowhanging fruit, as you plucked lowhanging fruit its harder and harder to get new innovation. As andy just explain, innovations dont get used up that way. In fact, each innovation creates Building Blocks for additional innovations, whether its the google self driving car are really trivial but i think elected example is undergraduate students, and he wrote this little app in a few weeks and with you much later there were 1. 3 million users using it. He didnt do any brilliant breakthrough but the reason his app was able to scale so rapidly was because he builds on top of facebook. Facebook was built on top of the world wide web. The web was building internet, built on networking, you could go on and on. Each of those innovations could make it hard for somebody else, but they made issue for someone to make an innovation. So the lowhanging fruit metaphor i think is exactly the wrong one for the nature of innovation and we are lucky it is because that means that we are getting more Building Blocks for additional innovation and more potential for additional growth. I just went through a bunch of questions which went to the second part of your book, before you break into the specifics, i think we need to grapple with that were generally, which is it going but it doesnt appear to be distributed. If we could get to the root causes of that. Why dont i touch on that as well . I think a good example of whats going on is something, in a conversation i overheard about the same time and he was getting his copy out spitting his coffee out. I was getting on a plane and a person was talking too loudly so couldnt help overhear what he was saying. Inducing no, no, no. I dont use h r blocks anymore. I used turbotax. It does things were actually. He was right actually. Turbotax does your taxes very actively. In a way does that it took a process come used to be done by humans, and it codified it and then it digitized it. Once it digitized it you could make a copy of that. You could make 10 copies or 100 million copies of it and thats what they did to each of those copies is identical to the original, a perfect copy. It can be reproduced at virtually zero cost. And it can be transmitted anywhere in the world through the internet almost instantaneously. So this is a good that is free, perfect and instant. Those are three characteristics we havent had for most goods and services in the past. They lead to some very unusual economics. In particular, they lead to winnertakeall markets or winner take most markets. While each new neighborhood or town might have a tax prepare, a human tax prepare who could do this stuff come with a Tax Preparation Program you dont want to have the second this program, you just want to buy the best one thats available. So those markets tend to concentrate, just one or maybe handful of programs of winners in those markets. And as a consequence the revenues for that industry in to be much, much more concentrated. Whats more, it doesnt require a whole lot of people to make copies of turbotax once the basic algorithms have been written. So you end up with some different economic. You get some winners and judaism losers. There are two groups of winners. One is a small group of winners, the people who create that, developers of turbotax, the folks at intuit. Some are billionaires. Many are millionaires. Theres another large group which we shouldnt forget which is consumers, people map access to amazingly cheap, Accurate Software in this category that they didnt have before, and they can solve the problem more efficiently than they could before. But theres also some people who are made worse off. They are people invest a lot of time and effort in learning how to do that profession, to that skill. Some went to college to do that. And now in an economy we compete against a 39 piece of software, a human tax prepare doesnt add as much coffee and a static we didnt there are 17 fewer tax prepares and or of years ago. What i just described for turbotax is a microcosm of whats happening in lots and lots of other industries. We are seeing it in software and music and media, in manufacturing, in retailing, and finance. And software pizza more and more of the world, that phrase from mark in his digitization becomes core of more and more industries we will see those same kind of economic effect more society. I love that example of erik because it illustrates the two main economic consequences that we spend the middle third of our book on. An example, the fix in both, the first one is the good news. Its bounty come is more, better stuff. As erik said the are two different flavors of the bounty. What is the reward for the innovator, the people who came up with turbotax. The other one, to repeat, the bigger category is all of us have access to higher quality, cheaper taxpreparation. We think its critically important not to lose the psychic that is good news. The bad news is the spread, whenever i talk about the book, i do an incredibly dorky dance move, i keep doing this. Instead of having an economy where our income and wealth are tightly clustered, we are going like this. The middle is being hollowed out, with a small group of people who know how to harness Digital Power and innovate. Their wealth goes way, way up. The middle is getting hollowed out in the bottom is Holding Steady or gradually slipping behind. Thats the spread, the challenge that we face in a second machine age. And our goal should be to keep the bounty going while minimizing the negative effects of the spread. What about the standard economic theory that we hear that this automation may be occurring in some sectors, which increased productivity overall, and other sectors will pick up the slack and we will get job growth to makeup for that . Why hast thou broken . For 200 years, People Like Us have been saying that the age of technological unemployment is not. It started about 200 years ago, happened during the Industrial Revolution. John makin canes, and intellectual here set in 1930s, get ready for the era of tech on the bum is again. The question is right. Knowing that history and historical pattern should calm us down a lot it is this time different . Is the airplane with your . The only answer is we dont know, its too early to tell but the data are not encouraging. I think there are good reasons to try to understand that this time is really different. For all of Human History if you want a report in history, you had to involve a person in that work. Not anymore. Their software. If you want to listen to a person, understand what he wanted, finding into afford them and spit it back in human speech, you had to involve the human being. Not anymore. You can go on and on. Diagnose the disease, answer a Telephone Company of these things weve always needed people for them. We dont anymore. So the digital encroachment into human territory is broad, deep, fast come and i think theyre reversible. To me that feels like this time is different. Different. Its not just that technology is different to the economic as you pointed out, technology has always been destroying jobs and its always been creating jobs. Theres been this Creative Destruction from this flow, this turnover thats gone from one industry to another industry. For most of the past couple hundred years, those been since the first machine age of Industrial Revolution. Those of them roughly in balance. If you look at the trends in productivity, employment, Median Income, they all kind of rose roughly in sync. Starting about 15, 20 years ago, they started diverting. Productivity has continued to grow, profits overall gdp has continued to grow but Median Income has stagnated. So its not keeping up the way it did before. Employment has really stagnated as well. So theres something new going on both in terms of the technology and in terms of the economic specifics statistics statistics. Statistics. We dont think those are unrelated at all. So then whats going to happen to the workingclass . We plea bargaining are has been weakened and that reflects the underlying fundamental economics that if a ceo or a company can make do with robots or software machinery, then its a lot harder for a working man or woman to bargain and say hey, give us our share of the revenues of the company, give us higher wages or else were going to go on strike. Because if they ca can say great can you guess one strike and we will replace you with robots, hes the guy who makes, produces our iphones, he says hes going to hire a million robots. Thats a pretty severe threat, and it turns out an increasingly realistic one. So the Bargaining Power of a worker goes down. Right now in america there are two really credible alternatives to the our workers in other countries thanks to globalization and theres a digital alternative which is already pretty good, and only getting better. Eriks story about the robots shows that these alternatives are appearing even in the lowest parts of the world. But to try to get back to the question, its way too early and to say that working class in america is doomed. We just dont want to walk away and say theres nothing to be done here, move on. The last third of the book is about the kind of intervention we think made sense in this era of pretty astonishing Technological Progress. You can jump in that or i can give you a couple of dispositions. Do young people need to ski in the new age economy . What can we do to increase educational and skill level to lead to more jobs when jobs actually to much for specific question. Why dont we start with a little bit about that. What the data says is that routine Information Processing path has been especially hard hit over the past 10 years. It basically means following instructions like that tax prepare were talking about, or travel agency, you can carry out information and it turns out that a big chunk of the American Economy is devoted to exactly those paths. But careful research by my colleague and others at mit has found that if you look at the skill content of all the occupations in the United States, the more routine Information Processing is involved in that task, the more its demand has declined for them, the fewer jobs there are, the more the wages are under pressure. So if youre looking for a job to stay with them, he would be routine processing in other words, a job that requires the three rs that we all get caught so much on. If you look at the way of a lot of schools are structured their very much set up to give people to sit quietly in rose and learn how to follow instructions carefully. That was a think a valuable skill in henry fords 20th century and were people at work and Assembly Lines and follow instructions and each do something very consistently. But Going Forward those are exactly the kind of skills, the path that robots are good at. Machines are good at. What machines are not particularly good at is creativity, inventing new things, entrepreneurial insights, or interpersonal relations relating to other people. We probably need to spend more time, we do need to spend more time reinventing education to focus on that set of skills, creative become interpersonal relations relating to other people, motivating people. Rather than the skills that were dominated in the second machine age following instructions. So i have one question pushing back a little bit on education. How does increasing the educational and skill level workers lead to more jobs when job creation is driven by aggregate demand within the domestic economy . Two good questions. The first is about, even if we get the educational system right, would that be futile . Output enough. When we talk to Business Leaders the most common complaint that we hear is i cannot find people with the skills i need. All up and down the ladder. From my front line employees up to the topic on the but i cant find people with the skills and you can end his to us our educational system is turning out people mismatch to the job market out there. So right now if we could wave a magic wand over education we would do a huge amount healthy unemployment and the wage crisis. The second part of your question though is about this concept of aggregate demand which economists love to talk about. The way to think about it is captured in wonderful, and a powerful story but a really good story about henry ford and ahead of the Auto Workers Union touring of active. Theyre looking through, and ford says walter, how are you going to get those robots in the room . And he said henry, audi going to give him to buy a car . In other words, this large stable prosperous american middle class that we create in the postwar decades is this phenomenal engine of demand they kept economy growing, yet we continue to polarize, the middle gets hollowed out more, does that demanded it as the definition of a recession, a recession unfortunately for all of is a nasty downward spiral of downward demand. We dont want that to happen. But the core of that question is a worldview of want to push back all of it which is its either or. If we have a recession it indicates structural matters. In fact its about. Paul krugman and Larry Summers are not in the room here as far as i can tell so i dont think if they were we would be hearing about it by now. The on the any bigger advocates were trying to boost aggregate demand and stimulate the economy than we are but thats a Business Cycle issue right now. What were talking that is the more fundamental longterm structural issues. For that matter theyre not unrelated. As andrew was saying these structural issues can lead to the fundamental drop in demand that we are seeing, and so you need to address both of them. You can run an economy with a very small group of elite at the top and a whole mess a fairly manageable people down at the bottom. Its feasible, its just a lousy society, a smaller economy. Its not we want to go at all. Spin it will almost certainly have political implications. Out somebody. Circle back to discussion of henry ford and the robots. Two questions, one is whether given what weve seen from longterm robot and what development, sure these workers be required to pay Social Security taxes speak with you mean the android worker . Yes. And relatedly, henry ford knew he need to lower costs to consumers products with increased wages. Do you think those who control the system see things in . Lets dive in deeper on that question. Theres been some great work done by joe stiglitz and others that look at what happened during the great depression, even worse downturn in the terrible and we were just suffering through. It turns out agriculture was mechanized and tractors were introduced. There were tens of millions of fewer farmworkers needed than before. So absolutely that kind of decline, structural change in employment led to a drop in aggregate demand, a downturn, and thats because those workers could and instantly find new work. Many of them had to move. We heard about the okies going to california and elsewhere. They had to be rescaled for new kinds of activities. That could take years, even a decade or more. One of our concerns is that as people become rescaled and by new industries and people discover new things, entrepreneurs helped discover the new things, and well talk about that later. By then that technology will evolve again so theres constant catchup required that could lead to some of the ongoing problems with not just structural employment but aggregate demand. Your question asked about the viewpoint of the tech baron vets of these days. We talked to a lot of them and i can report they are aware of the situation of the fact that technology is racing ahead and leaving a lot of people behind. One of the most Prominent Technology executives in the world today told us just last week that he thinks this is the single most pressing issue that he and his industry and all of us will confront in our lifetime. I find that good news. They are not turning a blind eye to whats going on at all. Lets go broad and get more specific. We have a good question. Which policies would you prescribe to mitigate inequality and increase employment . You asked about tax policy a second ago. We have a chapter on pretty short term recommendations. We didnt have a kind of father out chapter, lets say that the robots really are taking over in the digital encroachment is going to continue to be broad, deep, fast and irreversible. Then what . What kind of economy do we want to create . The are a couple of parts. I want to focus on tax policy, one of the questions was about that. Economist of the fairly straightforward answer to what did you about this question of what if the pot is big, but is not being distributed in any kind of a fairway . Their answer is if people money. Its very, very straightforward. Guaranteed income, it sounds like a frothing at the mouth socialist when i say that. It might not be too big a problem here in Northern California but you cant have that conversation and a lot of america because it sounds like you are so firmly on the far out left fringe. It turns out that idea was a cornerstone of nixons first term as president. Other socials like Milton Friedman and hayek. Theres this weird bipartisan history to this idea, and if this does continue to play out along these trajectories, we might revisit the. Thats not our preferred solution. Theres a wrinkle on that advocated by Milton Friedman among others that we like a lot better which is a negative income tax, which is lets encourage work, lets make sure people are still working and for every dollar they earn from instead of paying 20 cents of it in taxes, why dont we give them 20 cents and that will encourage them to keep working. These are some pretty heavy ideas. We think in a more far out future, lets shift the conversation around what we are taxing a now. And we need to shift it in this direction. We are at the halfway point. Are you still with us . [laughter] this is the Commonwealth Club of California Program and were talking with Erik Brynjolfsson and Andrew Mcafee about their new book, the second machine age work, progress, and prosperity in a time of brilliant technologies. On your moderate, andrew leonard, from salon. Com. You can your Commonwealth Club programs on the radio and also see video of the programs online on our youtube channel. Just jumping off what you just said, a couple of questions you are asking what you think a basic guaranteed income as a response to this issue. Which seems to be the opposite of a negative tax, or is that very closely related to let me go by what andrew was an. We think you can do a lot to reallocate the way income is divided, but the thing that andy and i focus on is something more like an expanded earned income tax credit. Let me explain the reasoning for that distinction. Both of them are ways of getting income into the hands of more people, some of the people who have benefited as much from the technology. Weve been very convinced first but a quote we came across, work solves three great evils. Wortham, vice and me. The point is its not just about they need. Its also about a sense of meaning and other values. And to be more scientific about it, bob putnam, the great sociologist at harvard, has provided some very convincing evidence that when work leads a committee, doesnt just take money out but it also leads to a whole host of social peoples, like increased drug use, teen pregnancy, the dissolution of the family, and increase crime rates. So its really damaging when people dont have a way to earn their livelihood, even if you replace the money. Thats not the issue. Earned income tax credit are other ways of encouraging work we think will help with that problem by making a more economical for businesses to hire people and for people to continue to have gainful employment as a people to have a way to contribute to Society Without just having a handout in some way that politically, despite what can be said about having support from many different perspectives, its probably going to be a higher hurdle to get past. Erik and i became convinced of all tears three great evils, especially in this abundant world that we are creating thanks in part to Technological Progress. The other two, the boredom and the vice whatever difficult challenges. Bob putnam has talked a bunch about this. Hes been doing careful work. Charles murray at another guy with very different political backgrounds but also looking at communities and what happens when work goes away. The stories they tell and the database shared are actually chilling. Like erik says, divorce rates go way up. Children living in single parent homes go way up. Incarceration rates go way up. Elections the way down. It becomes this really, really troubled community, and almost all the work that weve looked at says that the cause is very, very clear. Its when work goes away and bad things follow. So we are terribly interested in Solutions Like a negative income tax and earned income tax expansion that deserves for people but it seems important to do. Its too bad that the president is otherwise occupied right now in his state of the union. Somebody needs to get him a copy of this book. [laughter] this is one question, what would you include in president obamas state of the union and the republican response is . Youve given us a list of things already. What do you think the political will to act upon that . Weve witnessed for the last, definitely the last six years is a lot of dysfunction and moving forward in addressing any of these pressing issues. By your prescription, is it going to become more pressing . It starts with the right diagnosis and understand the issues because theres a lot of people are angry and a variety be angry. We see the tea party, the occupy wall street, and they are all pointing fingers at different bad actors but if they dont extend the underlying powerful trends in the economy, they will, with the wrong prescription. But i think these dont need to be left or right or republican or democrat or other political arguments. The policies and ideas we put forward in the book we think should and could have widespread support from lots of different groups. There are things that most people agree, government has a role in from education and infrastructure. And andy pointed out the tax policy. Let me point to another category which we think has support which is we can encourage more innovation in building new products and services through entrepreneur should. Thats not because we think everyone is going to be an entrepreneur, everyone loses their job should then become a notch for no. Its because entrepreneurs in our society of the people who are in charge of inventing a new industries and new products and services that employ people but if you go back and look at the first machine age, the Industrial Revolution, as people moved out of agriculture, 1. 90 of americans were in agriculture. Now its 2 to those people were not on template. What happened . The people like henry ford, steve jobs and bill gates and others that invented entirely new industries that redeployed those people that the new things for those people today. We need to speed that process up, despite a lot of entrepreneurship to hear about in Northern California and elsewhere, the data suggests theres been less new business grecian in the past decade and that was in the 90s or the 80s. So we are not creating those new industries fast enough. Government has role in setting the table to speed that up, and for that matter to, it up and slow down. We need to make sure we are making advances on all those fronts. Education, tax policy and i may have entrepreneur shep. Let me give you some optimism. You asked about what we would advise the president in his state of the address. We have a chapter devoted to shortterm recommendations in our book, and five really important areas in the chapter our education, entrepreneurship, infrastructure, immigration and basic research. No matter what econ 101 textbook you grab off the shelf written by conservatives or more liberal economist, they will say government has a clear role to play in those five areas. Very little controversy on the. The optimism i can give you, and this is not a time of great optimism, that getting things done in washington but they optimism i can give you, we are very close to comprehensive Immigration Reform bill. Came pretty close in 2013. Might well happen. That would be a great boost. There is broad agreement on both sides of the aisle on an entrepreneurship and the importance of increasing it. Theres a little bit of optimism about education. The two sides disagree on what to do but we all agree its important. You add that up, we are batting 400 there. Ted williams got into the hall of fame doing that once. But to be fair, there is a real problem in washington, and one of the reasons we wrote the book is to change the conversation. The technologies are doing an amazing job, but any realistic assessment is that our politicians for that matter, our Business Leaders are not necessary keeping up with what the technology is demanding. And that really sets up the size of the challenge because our ability to come up with policy responses to these kinds of problems is nowhere near as fast as the technology is examining. He spent the first third of the book, at one point you quote and order book about the rise of western civilization, the Industrial Revolution made a mockery of everything that came before. If were only at the cusp of this ad is going to go even faster, your playbook of solutions is something that we have a hard time getting through in times where change is slow. And thats why we think its a urgent had this conversation and to change it. One time we were bemoaning the slowness of the response in washington. A friend of mine said the thing it remember, that washington doesnt lead on these issues. Ultimately, washington are followers. Its they will respond when people demand. So its only once that all of us start understanding these issues and demanding change that people in congress and the white house are going to want to respond to it. For better or for worse it starts with us changing the conversation with understanding these issues, and then we can expect some action in washingt washington. You got the center challenge right. Its not a technological challenge. They are doing astonishing work and will continue to do amazing work. Technology will race ahead. Thats the one prediction about the future i make with 100 confidence. The center challenge is that our other institutions, the other elements of our society just arent changing as quickly. Our organizations, educational system, our political process. A lot of the other important parts of society arent currently geared up to change as quickly as technology does. Weve got to speed up the clock speed of our other institutions. Let me emphasize as these get more misaligned and mismatched we have problems. But the answer is not to try to dampen down technology or to slow down technology. The answer is to speed up our response to it. If we go through that you can see the be more and more pressure, more and more neoluddites who want to stop the technology and we think that would be a terrible out,. Amen. With the theme of second she rewriting questions on pen and paper and collecting them versus a nap . You dont have to answer that. Why did you write it that way . We have a group of questions wondering where this ends. Do Quantum Computers get consciousness . Are the areas that humans will be able to hold off the machine . I see where just about out of time. Laughter. I think weve learned, andy and die, to never say never. We sometimes play games when the writing the book, we point to some job or task or occupation and say theres an example of something machines just cant do it and lo and behold the next week we would run somethin somen delight those working on exactly that project. It is making very rapid there are certain areas with their happening more quickly in areas that are happening more solid. I mentioned creativity and enter personal relations. Picking up a time that most robots cant do and dont have a lot of success doing. Theres this great video by a bunch of researchers from berkeley about a towel folding robot. You have to speed it up. The robot looks at the towel for a really long time. Minutes to fold a towel. But again, wait a while. I had a chance to review the lego spot, and my son built a snake that lunged at your hand if you got near it. Hes the generation is going to develop these next ways. In the area of far out technological trajectory and progress that we spend our time going about the most, is this idea of similarity, this idea of our digital stuff actually becoming intelligent or fully conscious. Its an idea thats been popularized. Erik and i go back and forth on it a lot. I personally dont see that on the trajectory that we are on right now, but i want to echo eriks mantra, never say never. Let me talk about a trajectory that maybe we both can foresee which is one that keynes foresaw which is ultimate solving what he called economic problem, or the, of extreme poverty in the world. You dont have to be that wild eyed to extrapolate some of the trends that we are already on and you see the extreme poverty could be eliminated within 20 years worldwide. Think of that, how pretty thats something weve always had with us and people have struggled with her not centuries but millennia. And our generation, we may be within sight of finally dealing with extreme poverty. Thats because these technologies are creating so much bounty and so much wealth. The issue is going to be distribution and managing the disruption associated with it. But in terms of material progress we are doing quite impressively. I dont want to brag but bono was my warmup act at it. He gave this not a presentation to give got to watch it about the real potential, the likely trajectory to wipe out extreme poverty in Southern Africa and by extension than ever of the to echo erik, that is not independent from Technological Progress at all. Theres beautiful Research Done that shows what happened in the poorest parts of the world when people get mobile phones for the first time that the economic lives go on a completely different and better trajectory. Its critically important. Starting with the, 3d printers and a whole lot of other set of technologies that seem to be Science Fiction a few years ago of becoming reality now. Do you think these technologies will be applicable to other pressing problems . With the helpless deal with our energy issues, reduce Global Carbon dioxide emissions, Greenhouse Gases . If we have all this innovation, do you see well, we were talking about before and, theres a whole set of problems out there or we can only read one book at a time so were not going to take on all of those that want but if you think as our Technological Capabilities grew greater and with more power to change the world, one of those ways we can use the power is to address some of those fundamental needs. In the case of global warming, in particular im somewhat optimistic that this can be a big help. Theres a Research Scientist at berkeley who has looked at the Energy Consumption of computers, and that is improving even faster. So that gives me hope that we can do a lot to reduce our Energy Footprint as these technologies become more pervasive. Let me take eriks optimism up a bubble because i think its right. We put a quote in the book and some ideas from an economist who never gets enough credit for his thinking. He was the antimouse teaching. And the time when the war was so julian said you guys dont understand what goes on here. What we humans are extraordinarily good at is solving our problems over and over again. Things come up, they seem so dire and we find solutions to them. The reason we should be given more optimistic these days, and i mean this seriously, in the next few years, not within our lifetimes, in the next few years we are going to for the First Time Ever interconnect the worlds population. We will bring billions of people fully fledged into communities people can access the worlds knowledge, talk with each other, access huge amounts of Computing Power to put their ideas into practice. This is the best news going. Im very confident that humanity can meet humanities challenges. Let me underscore what you said. They will be able to contribute to the worlds knowledge, and talk about innovation, Business Innovation on steroids in a good sense. We can say this is the city of barry bonds. You all know what were talking about. You just said the issue of global poverty and impact of some these technologies in africa and asia relates to a question, how much of this problem with the growing income inequality in the developed world is u. S. Centric and west centric . Will go away once the rest of the world catches up speak was thats a great question. Let me look at other developed countries and then i will look at developing countries briefly. If you look at the oecd countries, the rich developed countries, the pattern is very similar in those other countries. In 18 of the 22 other countries where we had data, inequality has been growing in sweden, in germany, and france, and japan. One of the exceptions was greece but have a whole other set of issues going on over there. Greece is not the model. They started Different Levels of inequality but theres some are face of worldwide trend going on. Its not just politics. Its not just local conditions. Its something more fundamental from that. Then you want to look at a more broadly, look at whats happening in china and other countries. They are i think the story is even more striking because we were looking at some of the issues in terms of manufacturing employment and people often think of globalization and technology as being the two great forces affecting the economy, and the idea of manufacturing moving from the United States to china. It turns out that, in fact, manufacturing employment in china is shrinking. There are 20 million fewer people working in manufacturing today than they were in the 1990s. Its shrinking in the United States. Its shrinking in all the places worldwide so its not a matter of jobs moving from one country to another. Its jobs moving from both china and the United States the robots, the automation. The phrase that we used to describe this is that off shoring is just a way station on the road to automation, and as Technology Accelerates it becomes even more important in the next decade than it was in the past decade. Just like so anyways i think that countries like china that have been a star to relying on lowwage labor to compete or even more in the bullseye of this automation tsunami and the American Factory workers spent just like bounty is a global phenomenon. Unfortunate spread appears to be a global phenomenon as well. Your china example next to a question that just arrived. If you visit shanghai or beijing right now without a gas mask, you will have some difficulties. Theres the question of whether even very quick technological innovation can keep up with the human impact on the planet as the 7 billion people raise their prosperity level. This question goes specifically, the you expect it to get to solve the problems associated with a fastgrowing population and the dwindling of Natural Resources . And Technology Keep up with humans in the long run . That little bit of a different twist on the race of the machine. Yes, absolutely. With the exception, a very big exception of global warming, most of our environmental indicators move in the right direction rather than the wrong direction. Technologtechnolog y is a huge part of the reason why and im super optimistic that over all, again with the exception, were going to learn with technology to live more lightly on the planet. Let it is a race and is going to be tight, but fortunate as countries have become more developed the air in london is cleaner now than it was 400 years ago or 200 just ago, and it hasnt reached that turning point in beijing or shanghai, but i think people are starting to demand it there as well. This were a democracy in the middle class come in handy because demand these things of the countries they live in. Well, that brings us right here in San Francisco where the democracy is beginning to become irritated at the Technology Spinning thats some nice phrasing, isnt it . Its been one of the unique stories of the last 20 years, one of the birthplaces were so much of the modern digital age is now having almost and immune reaction to it. I dont know if the same thing is happening back east, but its too cold back east. [laughter] this is why we talk to our techno utopian friends who say look, dont worry, technology is going to take care of all these things ever said look, you have to grapple with the fact that not everybody is a sharing in the county currently and if you just ignore that people are going to get angry justifiably angry, and the reaction of many of them is going to be a, weve got to stop this technote you. Weve got to throw rocks at the google buses, or 200 years ago we were smashing the looms in england. And as we said earlier, we dont think thats at all the right solution. That destroy many of the benefits that we could be having. But if you ignore the problem that the reaction many people will have and where to change the conversation to focus on more Realistic Solutions that are more inclusive. Can the companies themselves address this directly . What do you think about Jaron Laniers idea that the means of closing the spread is for companies to pay for the data that they are allowed to mine and monetize . Should facebook, google, twitter, our banks, the New York Times a their users for using and interacting with virtual speak with you debated on this point. I had a chance to debate him on this point. He had a lot of rhetoric behind the motivation for his ideas. He wants to charge my brother to upload pictures of his daughter to facebook, and articles to charge me to look at pictures of my nieces. These are terrible ideas. I applaud his motivation. Dissolutions make no economic sense whatsoever. But your question was what can the technology to do arrests the spread of that theyre creating . Its a wonderful question. We had an interesting interaction, these days build humanoid robots as a substitute for humans. Look, if you give me a different challenge, if tommy to build robots that will work with people instead of being a substitute for them, ill do that instead i just like working a tough problems. You can specify what you guys want a problem to be. We have these wonderful Online Publications and contests and turns that motivate huge amounts of effort. One of the favorite ideas that weve come up with is lets use these things, use these motivating tools 2. 2 technologist in the direction again, close the spread, help with these challenges. Wwere getting pretty close o be in here so maybe we can try to figure out a way to go out looking forward. Theres a lot of parents in your, college age children, and i am one myself. But a lot of people are wondering what do i tell my kids to do. Where do i stay them to thrive in this second machine age, you know. A lot of things are out of our power. Getting the political system to address this, changing the taxation, but we do things we can do individually. What can people do themselves the best position themselves for the future . I would get three pieces of advice. First is look at those kinds of skills that machines are not good at the roberts touch on some of those. Creativity, interpersonal relations, motivating people, caring for other humans. Those are areas that continue to be in demand. The second piece of advice is dont be too locked into even those. Be flexible, because the nature of technology is constantly evolving and we have continued to be surprised as weve just been describing about the advantages that are happening. Its unlikely anyone career, anyone skill set that youll be family with you will be able to coast on that for 30 years or more. And the third piece of advice is really do what you love into something youre really excited about. Not just because thats more fulfilling to yourself, but to be coldhearted and economic about it, in those kind of winnertakeall markets, there will be rewards for being the very best at something. It will not be a lot of reports are being average or above average. There are a few people who can really be the best at anything unless they really love it, enjoy doing it and spend sometime on it. So those three pieces of advice i think are probably the best kind of guidance for a child or with anybody Going Forward in the second machine age. Like you say, this is probably the most common question is a pared question. Very often about how college age kids, so to piece of advice but the first one is for the kids hit the damn books. One of the most Inspiring Research we came across is about this gradual slide in and out of hard work going on at coe
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