The purely technical reason why principle A does not apply in this way is opportunity cost.
Let’s say S is a highly productive worker who could generate $500,000 for the company over 1 year. Moreover S is willing to work for only $50,000! But if investing $50,000 in AI instead would generate $5,000,000, the true cost of hiring S is actually $4,550,000.
Addendum
I mostly retract this comment. It doesn’t address Steven Byrnes’s question about AI cost. But it is tangentially relevant as many lines of reasoning can lead to similar conclusions.
We can imagine a hypothetical world where a witch cast a magical spell that destroyed 99.9999999% of existing chips, and made it such that it’s only possible to create one new computer chip per day. And the algorithms are completely optimized—as good as they could possibly be. In that case, the price of compute would get bid up to the maximum economic value that it can produce anywhere in the world, which would be quite high.
The company would not have an opportunity cost, because using AI would not be a cheap option.
See what I mean? You’re assuming that the price of AI will wind up low, instead of arguing for it. As it happens, I do think the price of AI will wind up low!! But if you want to convince someone who believes in Principle (A), you need to engage with the idea of this race between the demand curve speeding to the right versus the supply curve speeding to the right. It doesn’t just go without saying.
1) Based on analogy with the human brain (which is quite puny in terms of energy & matter) & also based on examination of current trends, merely super human intelligence should not be especially costly.
(It is of course possible that the powerful would channel all AI into some tasks of very high perceived value like human brain emulation, radical life extension or space colonization leaving very little AI for every thing else...)
2) Demand & supply curves are already crude. Combining AI labor & human labor into the same demand & supply curves seems like a mistake.
3) Realistically I suspect that human labor supply will shift to the left b/c of ‘UBI’.
4) Ignoring preference for humans, demand for human labor may also shift to the left as AI entrepreneurs would tend to optimize things around AI.
5) The economy will probably grow quite a bit. And preference for humans is likely substantial for certain types of jobs eg NFL player, runway model etc.
6) Combining 4 & 5 suggests a very steep demand curve for human labor.
7) Combining 3 & 6 suggests that a few people (eg 20% of adults) will have decent paying jobs & the rest will live off of savings or ‘UBI’.
I agree that I initially misread your post. I will edit my other comment.
The purely technical reason why principle A does not apply in this way is opportunity cost.
Let’s say S is a highly productive worker who could generate $500,000 for the company over 1 year. Moreover S is willing to work for only $50,000! But if investing $50,000 in AI instead would generate $5,000,000, the true cost of hiring S is actually $4,550,000.
Addendum
I mostly retract this comment. It doesn’t address Steven Byrnes’s question about AI cost. But it is tangentially relevant as many lines of reasoning can lead to similar conclusions.
We can imagine a hypothetical world where a witch cast a magical spell that destroyed 99.9999999% of existing chips, and made it such that it’s only possible to create one new computer chip per day. And the algorithms are completely optimized—as good as they could possibly be. In that case, the price of compute would get bid up to the maximum economic value that it can produce anywhere in the world, which would be quite high.
The company would not have an opportunity cost, because using AI would not be a cheap option.
See what I mean? You’re assuming that the price of AI will wind up low, instead of arguing for it. As it happens, I do think the price of AI will wind up low!! But if you want to convince someone who believes in Principle (A), you need to engage with the idea of this race between the demand curve speeding to the right versus the supply curve speeding to the right. It doesn’t just go without saying.
A few key points…
1) Based on analogy with the human brain (which is quite puny in terms of energy & matter) & also based on examination of current trends, merely super human intelligence should not be especially costly.
(It is of course possible that the powerful would channel all AI into some tasks of very high perceived value like human brain emulation, radical life extension or space colonization leaving very little AI for every thing else...)
2) Demand & supply curves are already crude. Combining AI labor & human labor into the same demand & supply curves seems like a mistake.
3) Realistically I suspect that human labor supply will shift to the left b/c of ‘UBI’.
4) Ignoring preference for humans, demand for human labor may also shift to the left as AI entrepreneurs would tend to optimize things around AI.
5) The economy will probably grow quite a bit. And preference for humans is likely substantial for certain types of jobs eg NFL player, runway model etc.
6) Combining 4 & 5 suggests a very steep demand curve for human labor.
7) Combining 3 & 6 suggests that a few people (eg 20% of adults) will have decent paying jobs & the rest will live off of savings or ‘UBI’.
I agree that I initially misread your post. I will edit my other comment.