Marc Andreessen: belief

Transcript context

…That is extremely interesting. So what I'm hearing is, you're not super worried about job loss. Is the key here that the timing kind of just works out, this population decrease, all these kind of have to line up for there not to be this massive job loss with AI? Yeah. Well, look, if we didn't have AI, we'd be in a panic right now about what's going to happen to the economy. Because what we'd be staring at is a future of depopulation. And depopulation without new technology would just mean that the economy shrinks. So it would mean that the economy kind of itself kind of shrinks over time. The opportunity diminishes. There are no new jobs, there are no new fields, there's no new source of consumer demand for spending on things. And so you would be very worried about going into a period of severe decline of stagnation. And essentially, you'd be looking at these very dystopian scenarios of an economy kind of self-euthanizing itself over time. And so you'd be very worried about the opposite of what everybody thinks that they're worried about. The only reason we're not worried about that is because we now know that we have the technology that can substitute for the lack of population growth and then also for the lack of immigration that's likely. And so I would say the timing has worked out miraculously well in the sense of, we're going to have AI and robots precisely when we actually need them, to keep the economy from actually shrinking. And I just think that's just a fundamentally good news story. To get to the mass job loss thing that people are worried about on the other side of things, you'd have to look at far, far, far higher rates of productivity growth. You'd have to look at rates of productivity growth that are 10, 20, 30, 50% a year, something like that, which are orders of magnitude higher than we've ever had in an economy in the history of the planet. It's possible that we get that. I mean, look, I have my utopian temptation along with everybody else. If AI radically transforms everything overnight, then maybe let's play out the kind of utopian- ... radically transforms everything overnight. Then maybe let's play out the kind of utopian scenario. You get to a much higher level of productivity growth, you get to much higher level of technological change. Corresponding to that, you'll have a massive economic boom. You'll have a massive growth in the economy. And then corresponding with that, you'll have a collapse in prices. And so the price of goods and services that are, whatever you're going to call it, affected by or commoditized by AI, the prices of those goods and services will collapse. There'll be price deflation. And then as a consequence of price deflation, everything that people are buying today gets a lot cheaper. And that's the equivalent of a gigantic increase in wealth across the society, right? Take it this way. This is actually worth talking about because people, I think, get sideways on this issue. So if AI is going to transform the economy as much as the, whatever, utopians or dystopians or whatever kind of thing that it will, the necessary economic calculation of what happens is massive productivity growth. ing to transform the economy as much as the, whatever, utopians or dystopians or whatever kind of thing that it will, the necessary economic calculation of what happens is massive productivity growth. The consequence of massive productivity growth, what that literally means mechanically is more output requiring less input. So, you get more economic output for less input. So you're substituting in AI for human workers or whatever. And as a consequence, you get this massive boom in output with much lower input costs. The result of that is you get gluts of goods and services in all those affected sectors. The result of those gluts is you get collapsing prices. The collapsing prices mean that the thing today that costs you $100, now costs you $10, and now costs you $1. That's the equivalent of giving everybody a giant raise because now they have all this additional spending power. That additional spending power then translates to economic growth, the development of new fields. Everybody's materially much better off very quickly. And then by the way, to the extent that you do have unemployment coming out the other side of that, it's now much cheaper to provide the social safety net to prevent people from being immiserated because the prices of all the goods and services that a welfare program has to pay from, they're all collapsing. And so, the price of healthcare collapses, the price of housing collapses, the price of education collapses, the price of everything else collapses because of this incredible impact that AI is having. And so in this kind of utopian/dystopian scenario that people have, there's no scenario in which everybody's just poor. In fact, it's quite the opposite, which is everybody gets a lot richer because prices collapse. And then it's actually much easier to pay for the social safety net for the people who, for some reason, can't find a job. And so maybe we end up in that scenario. I mean, the optimistic part of me says, "Yeah, maybe AI is that powerful, and maybe the rest of the economy can actually change to accommodate that, and maybe that'll happen." But the result of that is going to be a much better news story than people think it's going to be. And again, everything I've just described, by the way, is just a very straightforward extrapolation of very basic economics. I'm not making any bold predictions of what I just said. This is just a straightforward mechanical process that plays itself out if you have higher rates of productivity growth, which are necessarily the results of higher rates of technological growth. And so, I think we're looking at... And to be clear, I think we're looking at a world that's not radically transformed the way that, maybe, the utopians think that it will be or the dystopians think it will be. I think it'll be more incremental for reasons we can discuss, but I think that incremental, overwhelmingly, I think that process is going to be a good news process. And then even if it's much faster, it's also going to be a good news process. It'll just be a good news process in the other way that I just described.…

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