Editor’s Note: When I read the first line of Chief Investment Strategist Alexander Green’s article below, I was skeptical.
But by the end, I was nodding along in agreement.
Give it a read – and for more insights from Alex, check out Wealthy Retirement‘s sister e-letter, Liberty Through Wealth.
– James Ogletree, Senior Managing Editor
For the past few years, I’ve argued that the transformational potential for AI is underhyped… not overhyped.
The broader public has finally woken up to that reality. But only the dark side of it, thanks largely to the media.
Everyone who gets their newsworthy information from the media – that means all of us – should understand how that industry works.
I’m not talking about social media, which offers some trustworthy information amidst a cesspool of falsehoods, half-truths, propaganda and conspiracy theories.
I’m talking about the legacy media, the folks who labor – and often fail – to offer their customers objectivity and credibility.
Their primary goal is not to deliver accurate, contextualized news.
It is to maximize profit for shareholders, by selling either subscriptions, advertisements or both.
There is nothing wrong with maximizing profits, of course. We applaud the companies that do.
It’s what leads to innovation, efficiency and higher living standards.
The problem is that good news, in a largely peaceful and prosperous society like ours, is not news at all.
Nobody wants to hear every day about all the buildings that didn’t burn, the planes that didn’t crash, and the surfers that weren’t bitten by a shark.
Deviations from the norm are what’s newsworthy.
And in a world where billions of people are walking around with a video camera in their pocket, we get to see the worst things that occur each day, almost as soon as they happen.
Yet – outside of Ukraine and the Middle East – there aren’t enough terrible things happening to fill up the space available.
So the media often turns to “experts” to report – and amplify – their most negative opinions.
(Because human beings – who are forever on the lookout for potential risks and threats – are more likely to consume, like and share those.)
For example, you’ve probably heard Anthropic CEO Dario Amodei’s claim that AI will wipe out half of all entry-level white-collar jobs.
Microsoft AI Chief Mustafa Suleyman echoes that prediction… and claims it will happen in the next 18 months.
While these are both well-informed men, they are simply offering opinions. Ones that may well turn out to be wrong.
Meanwhile, positive opinions are underreported or tuned out entirely.
A few times recently, I’ve written about how AI is likely to increase net jobs… not decimate them.
Of course, I don’t have the reach of Amodei and Suleyman. But I do have a few smart people on my side.
For example, in April, Nvidia CEO Jensen Huang noted that most people will not lose their job to AI.
They are far more likely to lose their job to someone who uses AI effectively.
The people who have become Nervous Nellies about AI job replacement are like modern-day Luddites.
The original Luddites lived in early 19th-century England, in the middle of the Industrial Revolution.
New textile machines were spreading through workshops and mills, and to the factory owners, they were a miracle of efficiency.
To the skilled weavers and croppers who had spent years – sometimes entire lives – mastering their craft, those machines meant something else: lower wages, diminished bargaining power, and the quiet erasure of everything they knew how to do.
They smashed the machines. Yet they were unable to stop the march of technological progress.
Or… consider the advent of the automobile.
Thousands of people had built their lives around horses. It wasn’t just coachmen whose livelihoods were threatened.
It was an entire ecosystem – stable hands, carriage makers, blacksmiths, wheelwrights, feed suppliers, harness stitchers.
A whole world of work simply ceased to be necessary.
The car was faster. It didn’t need to be fed or rested. And no one needed to shovel the streets every day.
The horse-and-buggy industry died. But most people benefitted. And the workers who lost their jobs? They reskilled and moved on to other productive activities.
The same thing is likely to happen with AI. Yet the Luddites are still fearful.
A recent KPMG poll found that 40% of workers are afraid that AI will take their jobs.
In fact, a report from AI enterprise platform Writer found that 29% of workers are actively sabotaging their company’s AI strategy.
That is likely to backfire. Indeed, 60% of executives say they are planning to cut employees who refuse to adopt AI.
Huang believes that AI will actually put up to 40 million people back into the workforce as 100 AI agents work alongside every human worker.
Indeed, studies show that workers using AI were three times as likely to have gotten a promotion and a pay raise in the last year compared with workers dragging their feet on AI adoption.
Bottom line? You can throw in with the modern-day Luddites – and the scaremongers in the media who support them – or you can bet on the adoption of new cutting-edge technology.
History shows one bet has always paid off. The other one? Never.