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It seems obvious that labor displacement due to AI will create labor surpluses in existing fields. Which will feel quite bad for many of us in the present, but

It seems obvious that labor displacement due to AI will create labor surpluses in existing fields. Which will feel quite bad for many of us in the present, but net-net be good for society in the long run. Wages will go down, but cost of goods and services will decline even more. Markets will be more competitive than ever, which limits the moat/margin capability of many businesses. It's only really particularly bad for those earning very high wages where there likely won't be any way to materially fill the gap.

impossiblefork 9d ago
Why do you think it will be net-good for society in the long run? If wages go down, worker power goes down; and if dependence on labour goes down, you literally move closer to the situation of the extraction economies in things like petro-states, leading to oligarchy instead of democracy. It could be the end of ordinary people's power over society rather than anything even slightly good.
- adam_arthur 9d ago
  Nominal wage doesn't really matter, just real wages+purchasing power. Goods and services prices will fall far more than wages for most people. Why? Because there will be far more efficiency and competition than pre-AI. It's plainly evident from the nature of the technology. If one business can do something cheaper, other businesses will do it cheaper too, and have to cut prices to compete. But the shock will be sudden so it won't feel good for our gen. Future generations will benefit without the drama. Don't get me wrong, there will be big losers in some fields, and the short term will be painful due to retraining and loss of purpose/emotional toll. Many of us built careers doing things that may not be relevant anymore. Or relevant in a different, perhaps diminished way. But the same has happened to many professions throughout history and it's always led to general improvement of the broader public's welfare.
bradishungry 8d ago
What is obvious about that? What jobs are being created long term that can be filled by those displaced? To me it seems like even jobs that are not knowledge jobs are going to utilize ai to cut hiring, not grow it
- adam_arthur 8d ago
  When wages decline, cost of producing the service/good does down too. And when the costs go down, relative demand goes up. When relative demand goes up, the total labor needed expands. How many Uber rides would you take at $5 vs $20? How many times would you eat out at $10 vs $50? Would you pay for a house cleaner at $25/visit over $150/visit? A live in nurse at 50k/year vs 200k? The costs of all these things will decline materially when the labor pool expands meaningfully due to displacement. Technology has always been deflationary in the long run throughout history.

impossiblefork 9d ago

Why do you think it will be net-good for society in the long run? If wages go down, worker power goes down; and if dependence on labour goes down, you literally move closer to the situation of the extraction economies in things like petro-states, leading to oligarchy instead of democracy. It could be the end of ordinary people's power over society rather than anything even slightly good.

adam_arthur 9d ago
Nominal wage doesn't really matter, just real wages+purchasing power. Goods and services prices will fall far more than wages for most people. Why? Because there will be far more efficiency and competition than pre-AI. It's plainly evident from the nature of the technology. If one business can do something cheaper, other businesses will do it cheaper too, and have to cut prices to compete. But the shock will be sudden so it won't feel good for our gen. Future generations will benefit without the drama. Don't get me wrong, there will be big losers in some fields, and the short term will be painful due to retraining and loss of purpose/emotional toll. Many of us built careers doing things that may not be relevant anymore. Or relevant in a different, perhaps diminished way. But the same has happened to many professions throughout history and it's always led to general improvement of the broader public's welfare.

bradishungry 8d ago

What is obvious about that? What jobs are being created long term that can be filled by those displaced? To me it seems like even jobs that are not knowledge jobs are going to utilize ai to cut hiring, not grow it

adam_arthur 8d ago
When wages decline, cost of producing the service/good does down too. And when the costs go down, relative demand goes up. When relative demand goes up, the total labor needed expands. How many Uber rides would you take at $5 vs $20? How many times would you eat out at $10 vs $50? Would you pay for a house cleaner at $25/visit over $150/visit? A live in nurse at 50k/year vs 200k? The costs of all these things will decline materially when the labor pool expands meaningfully due to displacement. Technology has always been deflationary in the long run throughout history.