Exponential Growth Looks Linear ... Until It Isn't

Solar took 40 years to reach 1% of world electricity production. The next 1% will take just 3 http://t.co/joSDySlbng pic.twitter.com/ScPilE92Fl

— Ramez Naam (@ramez) June 18, 2015

Peter Thiel Quad Chart's the Future

In his 2013 talk at SXSW, Thiel suggests the following categorization of the future

The future is categorized according to optimism/pessimism and determinacy/uncertainty. When the future is definite, one can engage in plans with conviction, while indefinite futures require diversification. In moving from determinacy to uncertainty, we move from tools like calculus to tools like statistics, and instead of focusing on the substance or specifics of projects, we instead focus on processes and product delivery platforms. 

Thiel notes that indeterminate optimism is potentially an unstable quadrant, since it is characterized by both low savings (why save now if things will be better in the future) and low investment (things are uncertain, so investment opportunities are unclear). One manifestation of this is tumbling bond yields, which I will write more about later this week. Clearly it is ...erm, unclear, how an iterative year-by-year process with these characteristics (no saving, no investment) can on average lead to a future which is better. His main argument is therefore that we are transitioning to another quadrant, and implicitly suggests that if we fail to form definite plans for a better future through technological advance, a 1990's style Japanese death spiral awaits. Mercy.

I view these ideas mostly as a version of Larry Summers secular stagnation hypothesis, where slowing technological development leads to a dearth of investment opportunity and weakens aggregate demand. In this sense, Thiel is in agreement with Ben Bernanke, who also argues that secular stagnation is unstable (in Ben's argument, due to global capital flows).

Bobby Kennedy Understood Positive and Negative Externalities

From his speech at the University of Kansas in March 1968,

Our Gross National Product, now, is over $800 billion dollars a year, but that Gross National Product - if we judge the United States of America by that - that Gross National Product counts air pollution and cigarette advertising, and ambulances to clear our highways of carnage. It counts special locks for our doors and the jails for the people who break them. It counts the destruction of the redwood and the loss of our natural wonder in chaotic sprawl. It counts napalm and counts nuclear warheads and armored cars for the police to fight the riots in our cities. It counts Whitman's rifle and Speck's knife, and the television programs which glorify violence in order to sell toys to our children. Yet the gross national product does not allow for the health of our children, the quality of their education or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country, it measures everything in short, except that which makes life worthwhile. And it can tell us everything about America except why we are proud that we are Americans.

Basic Income Watch

Peter Fleming asks "why do people waste so much time at the office?",

In other words, work has become ritualised and detached from the practical things it was invented to accomplish.

Why do we work? The obvious answer is "to live". But it's not our actual job - giving a lecture, selling a car, nursing a patient or flying a passenger jet - that directly secures our life conditions.

For sure, most occupations in the West have drifted far away from the baseline of biological self-preservation. A job simply grants us access to man-made vouchers we call money. We then redeem these so we can then purchase life. 

How many vouchers we obtain and what we have to do to get them is the political question par excellence under neoliberal capitalism. But it's this growing disconnect between labour as a biological/social requirement versus work as a cultural artefact that has seen it take on a life of its own, spiralling out of control, taking over everything else.

Herein lies the work paradox. At the very moment it is glorified as the highest civic virtue (on both the political left and right) it is drying up at an unprecedented rate.

Slow GDP growth is nodding its head. One possible end game of this process is policy which partially decouples work from income -- a basic income guarantee. Of course, there are other end games as well.

Blue-Collar Blues

The Economist reports that

The men in Tallulah are typically not well educated: the local high school’s results are poor even by Louisiana’s standards. That would have mattered less, in the old days. A man without much book-learning could find steady work at the mill or in the fields. But the lumber mill has closed, and on nearby farms “jobs that used to take 100 men now take ten,” observes Jason McGuffie, a pastor. A strong pair of hands is no longer enough.

The article is excellent, but difficult to cleanly excerpt. It deals with the changing (more bluntly: imploding) job market for blue-collar labor, and its consequences for both men and women. For example, women on average are becoming more educated than men, and educated women are less willing to marry down the socioeconomic ladder. This generates an excess supply of uneducated men relative to uneducated women, i.e., a shrinking blue-collar dating pool.

Humans and Networks

Before beards were cool.

Yuval Noah Harari theorizes why humans run the world

Yet how come humans alone of all the animals are capable of cooperating flexibly in large numbers, be it in order to play, to trade or to slaughter? The answer is our imagination. We can cooperate with numerous strangers because we can invent fictional stories, spread them around, and convince millions of strangers to believe in them. As long as everybody believes in the same fictions, we all obey the same laws, and can thereby cooperate effectively.

This condition is clearly not sufficient to explain our dominance, but its necessity is an interesting thought. I am not fond of the terminology "stories", as telling someone else a "story" nearly always connotes deception. Although in some cases, perhaps that is the accurate description.

I read the narrative as being the following: humans create social abstractions to generalize clumsy physical or social practices, the abstractions evolve non-deterministically over time, driven by strong network and inter-generational effects, and are eventually (rightly or wrongly) elevated to the status of commandments from above. There shalt be currency. Thou shalt not cross borders without documents. Thou shalt get married. Ye shalt serve thy military.

P. S. Still working on my Old English.

Cognitive Bias and Pop Nutrition

Very science, much diagram.

Clay Jones muses regarding Alan Levinovitz's "The Gluten Lie"

"As humans, we are terrible at evaluating causal relationships. We are prey to a variety of placebo and nocebo affects. Our memories are highly unreliable. Confirmation bias and the avoidance of cognitive dissonance are powerful forces in all of our lives. And once a self-diagnosis is made, we are amazingly resistant to questioning it, likely because of the societal stigma against a psychological origin for symptoms."

I have not read the full book, but may yet. To think clearly about any difficult topic, one must put aside the voice in one's head that says "It's like this!" and go to the data. Nutrition is a difficult subject to study, because high-quality data is incredibly difficult to obtain. Enter various gurus, cranks, quacks and con artists who know the one true cause of your problems. Multiple double-blind placebo-controlled studies are your only protection.

Unfortunately science is hard, but we don't really have a choice; it is the only technique which can save us from mysticism and the dark ages of human thought.

The Robots Are Coming

"I'm sorry Dave, I'm afraid you're out of a job."

Kevin Kelly speculates

Like all utilities, AI will be supremely boring, even as it transforms the Internet, the global economy, and civilization. It will enliven inert objects, much as electricity did more than a century ago. Everything that we formerly electrified we will now cognitize. This new utilitarian AI will also augment us individually as people (deepening our memory, speeding our recognition) and collectively as a species. There is almost nothing we can think of that cannot be made new, different, or interesting by infusing it with some extra IQ. In fact, the business plans of the next 10,000 startups are easy to forecast: Take X and add AI. This is a big deal, and now it's here.

The observation that AI will appear quite boring is astute. How excited were you when your Facebook feed was spontaneously better organized, or when your autocorrect seemed to stop harassing you as much as before? These are small percentage changes in usability, but small percentages add up to market-dominating products. He goes on to describe a conversation with Larry Page, along with this insightful example

Rather than use AI to make its search better, Google is using search to make its AI better. Every time you type a query, click on a search-generated link, or create a link on the web, you are training the Google AI. When you type “Easter Bunny” into the image search bar and then click on the most Easter Bunny-looking image, you are teaching the AI what an Easter bunny looks like. Each of the 12.1 billion queries that Google's 1.2 billion searchers conduct each day tutor the deep-learning AI over and over again. With another 10 years of steady improvements to its AI algorithms, plus a thousand-fold more data and 100 times more computing resources, Google will have an unrivaled AI 

...  

The more people who use an AI, the smarter it gets. The smarter it gets, the more people use it. The more people that use it, the smarter it gets. Once a company enters this virtuous cycle, it tends to grow so big, so fast, that it overwhelms any upstart competitors. As a result, our AI future is likely to be ruled by an oligarchy of two or three large, general-purpose cloud-based commercial intelligences.

Much like a carcass in the wilderness, no data is to be wasted. It's quite easy to forget that these services are far from free -- you are feeding the beast. The observation regarding accelerating returns is incredibly important; see Watson. He goes on to describe the synergistic possibilities

If AI can help humans become better chess players, it stands to reason that it can help us become better pilots, better doctors, better judges, better teachers.

Again, bang on. Things then go off the rails a bit

Most of the commercial work completed by AI will be done by special-purpose, narrowly focused software brains that can, for example, translate any language into any other language, but do little else. Drive a car, but not converse. Or recall every pixel of every video on YouTube but not anticipate your work routines. In the next 10 years, 99 percent of the artificial intelligence that you will interact with, directly or indirectly, will be nerdily autistic, supersmart specialists.

I view this as fairly naive. I think he underestimates (1) how trivial it will be to network an integrate these highly trained algorithms (2) how the drum of progress will have us to do just that, and (3) how nonexistent the regulatory structure regarding AI will be when it "arrives". We are thirty years into the internet and governments are nowhere near catching up.

Overall the post is excellent and worth a full read.