Jan 22 2012

Le Future According To Val Part 2: Consequences


If you recall in my last section, I discussed how I see the human race as being driven by instincts that cause us to form societies and then compete within those societies for “sex rights” by the creation of pecking orders. I also discussed how many of the technologies I have covered over the last few years are tied up in the “status game” and are being developed precisely because they appeal to the instincts we have as humans to seek ways to improve our personal status. I also ended by pointing out that those desires make these technologies so irresistible that we as a species are pursuing them heedless of the consequences.

Wait, did I just say consequences? Aren’t I supposed to be this hedonistic amoral optimist wearing rose colored glasses about the future? I keep telling people I’m a cynic, and people keep refusing to believe me. But yes, there are consequences. I discuss some of them in my article on “VR Integration Will Require Total Transparency.”  To be blunt, everything comes at a price. The only question is whether the prize is worth the cost.

So let me ask you this. What is it worth to you to never have to worry about whether you will be able to eat today? How much are you willing to pay to never have to worry about having a home to live in? What would give to be healthy and young for as long as you chose to live? What sacrifice would you offer to ensure that you would never be the victim of violence or crime? What’s the price you’d give to have your every question answered or to be the one who finds the answer?

Would you be willing to give up Tyranny? How about Human Suffering? I’m willing to bet you’d think Death would be something you’re willing to do without, no? Disease, physical handicaps, starvation, poverty… those would likely be things you’d want to give up too, right?

Because that is the price we, as a species, will have to pay for following our instincts. No matter what you might think about any of the uses for technology I have discussed, it’s meaningless, because you, as an individual, have no control over the pecking order. In truth, as individuals, there is little any of us can do except stay out of the way of the evolutionary forces that are currently reshaping our world. This is a war of giants, a battle between two profoundly different systems of economic organization. We will get every one of these technologies because both sides in this war demand them. As the conspiracy theorist loves to scream, they are Bread and Circuses. We’re just lucky that they are also so very much more.

Martin Ford discussed how the economy is likely to develop over the next decade in his book Lights in the Tunnel. In short, the era of cheap overseas labor is ending. Greater awareness of the exploitation that has been occurring — as well as demands by those exploited for higher wages — is making it more and more expensive to maintain human labor, while automation has become ever cheaper. 3d printers are largely automated, and as I discussed in “Watson’s Descendants Will Make You Obsolete” enormous numbers of “high skill” jobs that required college educations and are considered “high status” like lawyers, doctors, and financial consultants will soon be replaceable by automation. As CEOs and stockholders demand ever higher profits, the “job situation” will grow progressively worse. More and more of the low tier “wealthy” will find their wealth sucked up by those higher up the pecking order as they continue to try and preserve their own wealth. As more and more people are laid off and replaced by software, the “Market” will become more and more divided, with fewer and fewer actors able to participate as “consumers.” In order to be able to sell any products at all, manufacturers will have little choice but to find means to make products cheaper, and in an effort to concentrate on smaller demographics in “The Long Tail” they will have to produce goods capable of being far more customizable to the individual. This will require major investments in 3d printing, resulting in a gradual abandonment of production lines as “product generations” become ever shorter. Between this pressure to make products cheaper, faster, and ever more customizable, and the continuing escalation of the “class divide” by the highest social tiers resulting in ever greater numbers of people removed as “consumers” with large amounts of available assets, companies which do not switch to 3d manufacturing methods and automation will likely flounder and go bankrupt.

This isn’t going to happen all at once, nor evenly, as there are likely to be areas in the world where the economy experiences massive growth. because the “Long Tail” has numerous “open markets” that are exploitable. The shift to automation and 3d printing will make this much easier to exploit, so don’t think that any given nation is “an exception” to this process. Due to the massive “divide” between the top and bottom, this inequality of “developed markets” will provide many opportunities for creative exploitation. But remember that since these markets have little “available assets” they will increase the pressure to produce goods via automation in order to make the products inexpensively and thus accelerate the cannibalism of the “low tier wealthy” in the developed markets. Short term “Booms” can’t make up for the overall trends of “unemployment” accelerating as the industrial processes are more fully automated.

Now, what do you suppose this ever-growing group of “formerly wealthy” is likely to do as their fortunes are systematically removed by the higher tiers? I mean, seriously, when in all of history has the “rabble” simply sat and starved to death quietly? OWS and the “Arab Spring” should illustrate exactly what will occur, which will encourage the “Powers that Be” to look for ways to keep the masses distracted, divided and unorganized. Cheap electronic entertainment devices, VR, sexbots, all the good little “opiates” intended to keep many people happy and contented will be tried. As I’ve had countless conspiracy theorists and “Privacy Advocates” point out, many of the technologies I’ve discussed have a very strong potential for authoritarians.  They’re just screaming for some “power group” to grab hold and try to use it to enforce a dictatorship on the masses. And they are absolutely right.

Based on current trends, we have to face the reality that many of the world’s democracies are facing a crisis of epic proportions. We are developing hundreds of ways to know every single thing about an individual that anyone — especially someone seeking power or a means to exploit — can use to attempt to control the masses. I’ve discussed the surveillance war many times. Even VR, which I view as a major factor in the coming decade, will require the building of a sensor grid that will make it impossible for an individual to remain “anonymous.” But as I’ve pointed out, that same technology also makes it increasingly hard for the top tiers of the pecking order to remain blank ciphers as well. In addition, we are simultaneously developing technologies that will make it ever easier to record and analyze all of that data coming from all those sensors. We have to face the reality that soon, privacy, as we know it, will come to an end. And to be blunt, this is not actually a bad thing, at least not in the long run.

So, let me ask you if you’ve noticed that two entirely separate forces are at work here?

The direction of future business is the “Long Tail” and ever-greater customization, and individuation in order to maximize profits, while the direction of future government is likely to be a push for greater authoritarianism. One force leans towards “freedom” while the other leans towards “tyranny.” This is because you have two different “elites” at work here, and even that is a simplification of the reality of hundreds of different “elites” all working for completely different ends. However, to keep the overall groups separate, I will classify them as “The Old Guard” and “The New Guard.”

“The Old Guard” is essentially those whose fortunes have been based on material goods. This covers nearly every sort of long established business model that’s more than a few decades old. These are the “Old Money,” the success stories of the Industrial Revolution — the descendants of the “Robber Barons” and the “Giants of Industry.” These are the people who already “have it made” and are desperate to ensure that their gravy train is not derailed. In fact, if they had their way, nothing would change ever, because progress is threatening to their continued dominance of the pecking order.

The problem is that their “cash cow” is dying. They are becoming victims not of failure but of overwhelming success. The entire drive of the industrial revolution was to overcome scarcity, and it has succeeded beyond their wildest dreams of avarice. With the aid of government, they created centralized distribution systems, centralized factory systems, and centralized marketing systems. They built production lines that crank out ten million items a day; supply systems that can feed billions of factories raw materials; stores that sell billions of dollars of merchandise a year. And they succeeded so well that now they are facing a crisis that they will not survive. Why? Think about that long and hard. Think about a factory that creates ten million items a day, every day, for years. Then ask yourself what happens if you only sell five million of those items a day? What about if you only sell five million a week?

And there you run into the conundrum of the centralized industrial system. It’s designed to run at maximum no matter what the market demand is.  It’s a fixed system of supply, with no way of matching that supply to demand quickly. Now, there are ways to compensate, such as advertising, opening up new markets, planned obsolescence, etc, but on the whole, the system has few ways to keep supply and demand balanced. Once a demand has been met you either have to find a means to create new demand or you have to face bankruptcy. That’s because the entire system is based on scarcity. If demand is high but the supply is rare, then the product has “value.”  But if the demand is low, and the supply is high, that product has little to no “value.” Prior to the Industrial revolution, almost every product was scarce relative to demand. Now, there is almost no product that is not available in the millions — if not billions — of units. Every industrialized nation in the world is a “saturated” market for these “Old Guard” industries and those whose wealth is based on them. The only reason the rest of the world isn’t saturated as well is because they lack the same centralized systems of distribution and manufacture — and control — of the industrialized nations.

These “elites” are entirely dependent on these systems for their wealth, power and influence.  The fact that these systems have effectively eradicated scarcity within the context of the societies within which they have reached the top of the “Pecking Order” is causing their “wealth” to lose “value.” In desperation, they are seeking every possible means to maintain their “Status” by cannibalizing those below them in the pecking order, as well as seeking ways to try and use the government to “stop time” by attempting to create laws to support their business models, or by diverting government resources into propping up their falling “profits.” And this is only possible if they can establish a system of control that is inherently dictatorial and tyrannical. As such, they desire to use government totalitarianism to enforce their continued “status” as the “top dogs.”

Arrayed against the “Old Guard” we find a group of “upstarts” that have earned their “wealth” through “Non-material” goods. These are the industries whose “products” cannot be picked up and handled because they literally have no physical existence. Can you measure a pound of WINDOWS 7? Can you pour me a gallon of FACEBOOK? Can you pass me a can of GOOGLE? These are products that work in the exact opposite manner of material goods. Their value is minimal if they are scarce. What value is a copy of Windows if it had only been installed on one single computer? Only the fact that Windows is the single most common computer operating system on the planet makes it worth billions. It’s “Value” increases the more abundant it is. And while you can indeed make a case for there being a material component to such “abundance dependent” products as computer processors, and electronics, their “material component” is a tiny fraction of the value of their “non-material” components — the designs of the circuits, and the patents protecting them. And these companies are killing the Old Guard, because they are the driving forces behind the evolution of an entirely new economic system based on massive abundance. And the best way to promote their interests is to create a market of infinite diversity to maximize the number of demographics they can sell too. As such, individuality, and as a side bonus, Liberty, are primary drivers for the “New Guard.” After all, it’s hard to sell something unless someone is free to have a demand for it.

And if you want an example, just look at the recent events that played out over SOPA — a bill intended to give tyrannical levels of control to business interests based on material products that was universally opposed by businesses which offer nonmaterial products. Don’t fool yourself thinking the mass protests by the giant corporations against this bill were because they supported individual rights, or that the “grassroots” protests had any influence at all. This was all about money, and the “Old Guard” trying to prevent the “New Guard” from being able to make it by using the government as a shackle around their ankles. SOPA was all about protecting an obsolete and no longer profitable set of business models from competition by new models promoting nonmaterial value.

These two systems are diametrically opposing methods of creating a pecking order, and rely on fundamentally different “markers” to determine status within those pecking orders, yet they also currently share many “common interests”. These “shared” interests are being pursued for different reasons by both sides because they serve very specific needs for both sides, and are seen as absolute necessities in order to reach their goals. The really funny thing is that the deck is stacked entirely in the “New Guards” favor. There is literally no way for the “Old Guard” to win in the long run, and many of these short term “shared interests” are extremely detrimental to their long term survival, no matter how much it might appear otherwise.

So let’s take another look at that “vicious cycle” I described above, involving increasing automation. More and more automation will occur as “Old Guard” businesses attempt to cut costs in order to increase profits, eliminating workers in ever higher status tiers, as continuing advancements in electronics enable more sophisticated “software workers” while continued advances in 3d printing make it cheaper to manufacture a greater variety of goods and those goods begin to incorporate more and more electronic “intelligence.” Eliminating “high cost” employees in favor of “low cost” automation will ensure “increased profits,” but at the same time that it’s removing the middle tier players of the market. As such, automation is a short term “Win” for the “Old Guard,” but because of the cannibalization of the workforce — it removes “Consumers” from the market — so it’s a long term loss.  The “high end” market is already saturated, and as it grows smaller, that saturation level will simply increase. Their “system” for creating wealth is “mass production,” and that system demands billions of consumers to work. A few million “ultra wealthy” is too miniscule a market to sustain it, however many “liquid assets” there might be available.

So, as the high end market becomes increasingly smaller, more and more focus will be put on the low end… the “long tail” of individuation, customization and upgradability. This will also force manufacturers to focus on making those products using new materials that require less “material” per product. They will also need to be more “intelligent” in how those materials are used. By increasing automation and moving from Industrial Era “production line based” mass production to “printer based” mass production, manufacturers can not only limit production runs to actual demand, but switch products with a simple file change. That not only eliminates the “saturation effect” of production lines, but also eliminates “backstock,” since any conceivable part could be made on demand. Auto manufacturers are already looking at 3d printing as a means to provide parts for every make and model of car ever made for restorations. If you understand anything about economics, then it should be obvious that 3d printers allow for goods to behave as if they were nonmaterial. All you need is a single item and you can make an infinite number of copies. Yes, it will be several years before we begin approaching that level of capability, but this is the inevitable end result. And as 3d manufacturing becomes the normal way to make something and units move out of the factories and stores and into the homes, this ability to treat “Material goods” in the same manner we do computer files will be eradicating the “value” of those goods in the status game. Since many of these goods are human needs  like food and shelter, this sudden “infinite supply” will eliminate their value as hostages in the status game (as well as the ability of the “elites” to use them as means to enforce control). It should be obvious that such “abundance” could  eliminate many causes of human suffering by removing basic human needs from the market as commodities by making them nearly free.

At the same time, as the demographic divide increases, more and more political pressure will come to bear on government from all sides to “do something.” The “Old Guard” will likely seek ever more authoritarian measures to try and keep control while the “New Guard” will fight back against any measures that are directed at preventing their market invasion — doing more and more to promote individuality and “uniqueness” in order to capitalize on nearly every single niche market it can create. As technologies such as VR and 3d printing mature, they both will be seeking to utilize and promote their use at all levels of society to try and give themselves an “edge” against the other.

In addition, as “software workers” and 3d printers increase in capability while decreasing in price, more and more of the “disenfranchised” from the “knowledge worker” tiers that are being replaced by automation will be able to acquire the “means of production” and enter the market as competitors instead of as consumers. This increase of competition will accelerate the vicious cycle, giving greater and greater resources to the “New Guard” who will eventually gain a much larger share of the government’s attention, and gradually eliminate all the “special protections” won by the “Old Guard” in favor of laws and regulations favoring their new economic system. As new technologies continue to develop and can be applied to “the market;” most of the “markers” in the current “Status Game” will have their value eliminated in favor of new markers who’s value will be determined by how quickly they become widespread enough to be “commonplace.” This isn’t going to happen overnight, and I rather strongly suspect that “terrorism” is going to be wide spread due to various groups who will resist this eradication of the status markers. And rest assured, both sides will use that resistance to promote the adoption of technologies that they see as vital to their goals.

And yes, some of those technologies have long-term effects that will be very difficult for many to cope with. The most obvious of these is, of course, surveillance and sensor technology, which both the Old and the New Guard will be avidly pursuing as part of the “Surveillance Arms Race” I have talked about previously. The Old Guard wants cameras and sensors everywhere because they desire control. The New Guard wants it because the more they know about you; the better able they are to target a given product to you. Neither one of them gives a damn about what you think about it. Your privacy is meaningless to them, though they will both seek to give you an illusion of it. But as I have said before, increased ability to spy upon is an increased ability to be spied upon. The Old Guard will want to spy on the New Guard. The New Guard will want to spy on the Old. They both will want to spy on the government. And the government will be spying right back, right alongside the media, paparazzi, bloggers, and who knows how many other “interested parties” — all eager as can be to share what they see with “the public” as a way to “score points” in the “status game.” And this will continue until no place on the planet is immune to surveillance and likely no-where else, either. And once everyone, everywhere, at every tier of society, is “on camera,” it becomes possible to restore “accountability”, as I discussed in “How Transparency will End Tyranny.”

The same goes with medical technology, because the Old Guard doesn’t want to die or get sick, and will spend billions to find ways to prevent it and the New Guard is just as interested, because it’s something that will universally sell. No matter how hard the Old Guard tries to prevent access to rejuvenation technology, the New Guard will want to give universal access because the “Old Guard” is just far too small a demographic and far too tiny a profit. As for the more “outrageous” abilities I’ve described, such as full body reconstruction? The Old Guard will want it but they will claim to oppose it because they will be trying to use it as a means to keep the “masses” divided and in conflict, while the “New Guard” will want it because people will want to pay for it.  The same goes for VR, BCI, robots, 3d printers and many other technologies. Both sides of this paradigm shift between economic models will have uses for them and will promote their development and adoption — with these entirely different goals in mind. And because of the difference in how these technologies affect these very different economic models, the long term result will be the continued shrinking of the “Old Guard” and the continued growth of the “New Guard” until only the “New Guard” is left.

But that’s not the only card stacked in the “New Guard’s” favor. Because unlike the “Old Guard,” the “New Guard” is not reliant on over a hundred years worth of physical infrastructure designed to promote centralized management of resources. This means that they are far more flexible, and their “distribution” systems are far more decentralized. Like I discussed in Building the True Decentralized Net, physical infrastructure takes time and massive resources to construct. As more and more “New Guard” rise to join the “upper tier,” they will likely do so from places in which such infrastructure is nonexistent — and because they have bypassed such systems in favor of far more robust, decentralized and upgradable systems which capitalize on matching supply to demand, instead of trying to force demand to match supplies.

And as the “New Guard” eliminates the “Old,” that massive increase in competition that has occurred as this paradigm shift proceeded will make it untenable for the current “Corporate Model” of massive multinationals to continue as a dominant form. The “Giants” of the “New Guard” won’t survive either. Like the “Old Guard,” they too rely on an economy of scarcity to feed their voracious appetites, and in a world of micro markets they will eventually starve.

There are many other factors that will come into play as well, but these are the ones I believe are central to the overall outcome. To summarize; the economy will not likely recover in the manner most people wish for because it is in a collapse mode due to the evolution and replacement of the underlying systems of determining “value” and the shifting of the paradigm from a “Scarcity Model” to an “Abundance Model.” And this collapse is being accelerated on the part of the “Old Guard” by the continued elimination of human “labor” and increasing “automation,” while simultaneously being accelerated by the “New Guard” through the technological innovation making it possible for the “Old Guard” to continue to “profit” as it self-cannibalizes. This will result in both efforts to impose totalitarian control by the “Old Guard” as means to try and prevent the erosion of their “profits” and prevent unrest by the increasing number of disenfranchised; and counter efforts by the “New Guard” to promote democratic measures in an effort to prevent such “blocking tactics” by the “Old Guard” and promote their own interests as they pursue greater profits by promoting “individuality and customization” as they seek to enter ever smaller demographics of “The Long Tail”.

Because of this “War of the Giants,” there will be some very dramatic and chaotic effects on the social organization of the human race, and the instinct driven “Status Game” that it plays. The paradigm shift from “Scarcity” to “Abundance” will necessarily eliminate almost every marker currently used to determine status, such as material wealth, physical traits/abilities, and access to physical resources needed to survive.  It will also likely cause traumatic disruption to many, if not all, belief systems currently used to divide individuals into cliques within the “Pecking Order.” This social “disruption” could range from fairly mild to severe, and unfortunately, will likely cause an unknown number of casualties as some “cliques” will attempt to desperately cling to the obsolete markers and the increasingly defunct pecking order they supported. The transition period between these two paradigms will be neither pleasant, nor peaceful, but the end results will be the elimination of most forms of human suffering due to lack of the material necessities of food, shelter, education, medical care, and security, and remove many of the current causes of war, crime, and misery. Because of the changes caused by the reorganization of the “pecking order” into a “Status Game” based on non-material resources, and the removal of “material resources” from that game, as well as the return of accountability to the whole of human society due to the final results of the “Surveillance Arms Race” — that new “Pecking Order” will be far more level than the current one, and the lowest tiers will not lack for physical needs nor “social mobility” due to denial of same by the highest tiers.

And that, my friends, is the future I see, and which determines what technologies I cover and the “optimism” I am so often accused of. Believe what you wish, but I’m neither an advocate nor an optimist. I see this as a straight forward exercise of logic based on a rational analysis of the current situation extrapolated to a logical conclusion. The “Singularity,” if it ever actually occurs, will follow many years after these developments.

But yes, we are indeed facing the beginning of the end of the world… as we know it. Le Roi is Mort. Vive Le Roi.