Reading the new book from Erik Brynjolfsson and Andrew McAfee was like a breath of fresh air. The Second Machine Age: Work, Progress and Prosperity in a Time of Brilliant Technologies, elegantly summarizes the radical economic changes I’ve been trying to describe in blog posts.
In short, The Second Machine Age describes the ways that information age technologies have changed the rules of economics. In many ways the book is a summary of material dealt with in greater depth by Nassim Nicholas Taleb (Black Swan), Michael Lewis (The Big Short), James Gleick (Faster) and Daron Acemoglu and James Robinson (Why Nations Fail). As such, it’s a fast read that cruises across the surface of dozens of potentially complex topics.
Anecdotes and generalizations substitute for depth, but no truly detailed treatment of this subject could be boiled down to an airplane book. The Second Machine Age is neither the most insightful nor profound book about our time. It is, however, extremely accessible and reliably accurate. As such, the authors have delivered a mass read that can bring these important topics to a broader audience.
Some of the main points from the book:
1) Machines can do more now than we ever imagined they might be capable of. No one can confidently claim that a particular activity or field is comfortably beyond the range of our machines.
2) Information technology is introducing a kind of exponential economic expansion that we did not experience in the Industrial Era or at any time previous. It gives rise to a “superstar” dynamic, concentrating returns on investment in the hands of very few winners.
3) Most of the progress brought by this digital revolution has escaped our notice and passed under the radar of our usual methods of economic measurement.
4) Digital economics is radically more lucrative and unequal than anything we have faced before. The “bounty” and “spread” of the second machine age are shredding our social safety net and weighing us down as we struggle to ride this wave.
5) The second machine age may not drive unemployment overall, but it has already nearly destroyed middle income employment. Our vision of what employment means needs to change.
6) Winners, for the most part, will be the people who find way to successfully augment, not replace, automation. Almost no one has a job which cannot in some respects be automated. Successful workers will be the ones who learn to enhance what computers or machines do.
7) What should we do about it? Recommendations include education reform, streamlining government, infrastructure investment, aggressively recruiting immigration, pollution taxes, and of course, a basic income. Any of these sound familiar?
Brynjolfsson & McAfee’s book is too important to merely summarize. The next few posts will include excerpts and my strong encouragement to give it a read.
Our generation will likely have the good fortune to experience two of the most amazing events in human history: the creation of a true machine intelligence and the connection of all humans via a common digital network, transforming the planet’s economics. Innovators, entrepreneurs, scientists, tinkerers, and many other types of geeks will take advantage of this cornucopia to build technologies that astonish and delight us, and work for us. Over and over again, they’ll show how right Arthur C. Clarke was when he observed that a sufficiently advanced technology can be indistinguishable from magic.