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Afford Anything | Make Smart Money Choices
Why AI Taking Your Job Isn't the Real Problem, with Fmr. OpenAI Exec Zack Kass
01:31:13
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- [00:01]
A
Will you still have a job in five years? That's the question that keeps a lot of knowledge workers, white collar workers, up at night. As AI gets smarter every day, what if it's the wrong question? We're going to discuss that today with Zach Kass, one of the world's foremost authorities on Applied AI. He is a former executive at OpenAI, one of the first 100 employees at OpenAI, and he served as OpenAI's head of GoToMarket, meaning he built out the sales solutions and partnership teams. While there, he played a key role in commercializing AI and large language models and serving as an advisor to many executives who were deploying AI across their companies. He is an advisor to many Fortune 1000 boardrooms, including Coca Cola, Morgan Stanley, and Samsung. He's an executive in residence at the University of Virginia's McIntyre School of Commerce. And he is the author of a new book called the Next Renaissance, which is all about AI in the context of the expansion of human potential. And in our upcoming conversation, Zach makes the argument that the real threat from AI isn't economic, but rather it's emotional. So the question isn't will I lose my job? But rather, who am I without my work? We discuss financial literacy, screen addiction, and why housing, healthcare, and education in particular stay so expensive while while many other things get cheaper. Welcome to the Afford Anything podcast, the show that knows you can afford anything, not everything. The show covers five pillars, financial, psychology, increasing your income, investing, real estate, and entrepreneurship. The acronym is fire with two eyes, Double eye Fire. I'm your host, Paula Pant. I trained in economic reporting at Columbia, and I very much wanted this conversation to be about that first letter, I, increasing your income. I wanted it to be about jobs, careers, especially for knowledge workers in an AI world. And Zach very much challenges the premise of that question. It's a very welcome conversation. I think you'll really enjoy it. You'll learn a lot. I learned a lot. Here he is, Zach Kass. Hi, Zach. Welcome.
- [02:12]
B
Hi, Paula. How are you?
- [02:13]
A
I'm great. How are you doing?
- [02:14]
B
Very good.
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A
Tell me about your background with AI.
- [02:19]
B
My background with AI is actually my career background. So I've worked in AI for now 16 years. I got a job at a company called Crowdflower. Actually, what I don't tell people is I tried to play professional volleyball first. That was the first job I tried to get. I was not good enough, so I couldn't make money. Then I came back to the Bay Area and got a job at a company called Crowdflower, which was A very early data labeling company. People have heard of Scale AI, the company that Meta just bought for, you know, half of it for 15 billion. Before scale AI, there was a company called CrowdFlower, and CrowdFlower was building machines to help humans build large data sets. I worked there for six years and then found my way to a company called Lilt, which was building neural nets to solve machine translation. And from there went to OpenAI, where I was one of the first hundred employees and built the Go to Market team, which was sales, solutions and partnerships. And then for the last two years have built a global advisory firm. I have a couple academic positions and spend most of my time trying to figure out the answer to the question what happens next, especially related to AI.
- [03:20]
A
Let's cut to the question that's on everyone's mind. Most of the people who are listening to this are knowledge workers. Will they have jobs in five years?
- [03:27]
B
Oh, so first of all, I'll answer the question because I'm obligated to. Yes, they will in five years. And I think many people will perhaps come to find that their job has not changed all that much. And there are some reasons for this. I'll get to. There's a longer horizon that I think should be talked about. But I need to tell you and any listener that what we are discussing here that the job automation problem is far more complicated and nuanced, as many things are, than simply will jobs disappear or will they not? And we should couch this. So let's just talk about this as job creation versus job displacement. Let's make this part of the discussion that in that there are like two camps. Basically, people like Dario Amande, the CEO of Anthropic, the CEO of Ford, have said 50% of all white collar work or knowledge work, as you put it, is going to be eliminated in, I think their number was in the next 10 years. I don't think that's right. On the other side, you have people like Brad Lightcap, the CEO at OpenAI, or SAM, or now David Sacks, the White House, who said, hey, this is actually going to create more work. So there's still a division. But what I want to point to are a couple things going on. First, on the economic issue, when people ask me what job is going to automate first, because presumably there will be work that gets fully automated that we just don't do anymore, I have to remind them that we have special interests in this country and in this world that protect an exceptional amount of labor. We recently published a white paper called Illegal Automation, which sort of explores all the jobs that are protected just because of special interest policy. And so when people say, okay, well, fine, tell me what job is going on May 1, I say, show me the weakest union. Show me the weakest cartel or union that cannot protect their labor force. Well, and we'll come back to that in a second because that is the likelihood. Right? And what I remind people is software engineers do not have a union. That job became very luxurious very quickly, and they never thought that they needed to organize. And when people talk about the automation, the inevitable automation of software engineering, the only reason it really comports for me is because they don't have collective bargaining. Most of their knowledge work does. So let's leave that aside. Now let's talk about what I think the big issue is. And the big issue is the one that I think people struggle to talk about because it's way more nuanced than anyone wants. It's not good discussion topic, but it is the emotional consequences of automation. I don't actually lose a lot of sleep worrying if we're going to have more and better food on the table. That's not what I worry about. What I worry about is are we going to be able to answer the question, who am I? It's highlighted all over the place. But the one moment in time I think that has best captured this issue happened in October 2020 when the dock workers went on strike. Do you remember this?
- [06:07]
A
I don't remember what happened at that time.
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B
The longshoremen on October 2 last year walked off the job site. 50,000 people, mostly men on the eastern seaboard, left the ports for three days. They went on strike. And it basically paused a lot of the economy. And the head of the longshoremen, Harold Taggett, went on CNN on October 3, the second day of the strike, pointed at the camera and very calmly said to the American people, you have no idea how dangerous I am. I will cripple you. Wow, guess what?
- [06:37]
A
His asks were better pay more time off, possibly more safety and security measures.
- [06:44]
B
You have nailed the three things that every union has asked since we organized labor. None of those were his requests. His only requests of the ports were that they guarantee not to automate their jobs. That was the request. And the picket signs read, robots don't pay taxes and automation hurts families. So I tried to meet with him. I sent him a thoughtful note. He sent something less. So back. He did not want to meet with me, but we met with a bunch of longshoremen because I was super fascinated. I had this eerie Sensation one that this could be something really scary and bad and actual and economic issue. But I also had this sense that, wait, this might be the thing. So I went and met with a bunch of these guys. We asked them a battery of questions. Of the questions we asked, four told us everything we needed to know. The first question we asked, what is the most important part of your job? Multiple choice question. Five of the seven said, community. Second question we asked, it told us everything we needed to know. Do you believe you could be gainfully employed outside the union? Five of the seven said, either agree or strongly agree. There's plenty of skilled and semi skilled physical labor jobs available. Third question, was anyone in your family in the union? Four of the seven said yes. Their father, their uncle or their grandfather is in the union. And the last question, do you want anyone in your family to be in the union? Five of the seven said yes. One of the seven said they were going to continue having children until they had a son so their son could be in the union.
- [08:02]
A
Wow.
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B
Now what does this tell you? It's not an economic issue, we all day, you and I, everyone here asks ourselves and people around us explicitly sometimes, when is this good or service going to be better, faster or cheaper? Without recognizing that what we are asking is when is this good or service going to have a human extricated from the manufacturing of it? One of the questions that I finally figured out I needed to ask these guys was who do they think benefits economically when we automate the ports? To what end are we automating the ports? I'll ask you the same question. Who benefits economically if we automate the ports?
- [08:39]
A
I would say if goods and services become more efficient, cheaper to produce, then, then the American people benefit.
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B
Or everyone.
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A
Right? Exactly.
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B
Everyone, including eventually the dock workers and their kids. This paints this incredibly important picture against the backdrop that we face today, which is we all want everyone else's jobs to automate. We are all sitting around being like, when is the accountant going to get automated? When is the lawyer going to be automated? When are these judges, all these small claims, but you know, you want to, you want to have a small claims court hearing, two years permitting office, one of the perimeters going to be automated. I don't want to wait nine months for a permit. And by the way, for good reason. We are economic actors who have been conditioned to believe the world should get better and faster and cheaper. And, and the problem is we're now faced with the opportunity of putting a lot more food that's a lot better at A lot lower cost than the table. And it's going to come not an economic cost, but an emotional one. And the thing that I cannot stop staring at now is the future where everyone wants everyone else's jobs to automate except their own. And I have to remind everyone that we are all descendants of people whose jobs were automated to our economic benefit. And we just forgotten about it. We forgot about the sacrifices they paid, many of them, probably emotionally, in order for us to live the bounty that we have. And what I have to tell people, this is the answer that doesn't work in terms of sound bites. But whether or not your specific job gets automated is actually less of a concern. I'm not saying this to tell someone that they shouldn't be upset, but it's not the economic concern you think it is. It's the emotional one. Can we extricate our purpose and identity from our work? Because if we can't, then we're not going to let any of our work be automated. This is just going to be one of these incredible things where we actually fight to the death for a job that some of us don't even like. Because the idea that we won't do that thing and we aren't on that career path is just terrifying. When people talk about job automation, it's far more nuanced than what a machine can do. It has far more to do with what special interest will let those machines do. And then it has a lot to do with what will we actually allow ourselves? Will we allow ourselves to sort of reimagine the purpose of being alive? And if we do, by the way, if we do, I think what we are going to discover is there is a ton more interesting work to be done. There is so much that's not being done today that we would like to do, and so much that is being done that we'd like to do more of. The world would like more good chefs, the world would love more good artists, the world would love more good coaches and teachers and massage therapists. Like, there's a bunch of work that we would love humans to do more of that we don't pay enough for or we don't have a great enough demand for because the supply can't actually meet. And I am very eager to explore a far more human world that I think arrives as a result of this automation. But it just may not be something that our generation is quite ready for.
- [11:30]
A
What I'm hearing in your answer, and let's walk through this example, I'm thinking about a 53 year old attorney. On one hand, there is the emotional component that they have always identified as an attorney. And to a great extent many of us, it's natural and human to have a sense of identity that is built into your work. We see this with a lot of retirees in which people retire and they don't anticipate they the loss of identity that comes with retirement.
- [11:58]
B
I remind everyone the two most common last names in the United States are Miller and Smith because we used to name ourselves after our professions.
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A
Right.
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B
This is nothing new. You know you're not Paula, podcast host, right? But 300 years ago you might have been.
- [12:13]
A
Right. So there's this very natural human tendency to self identify with your work. And so if I think about this 53 year old attorney, there's the identity component of it, but then there's also the fact that this attorney maybe has a job that let's just say hypothetically that job gets automated away. And we can put a pin in that because that may or may not happen.
- [12:33]
B
I'm glad you're there with me. It's a little more nuanced than that.
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A
But yeah, it's more nuanced than that.
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B
Keep going. I'm willing.
- [12:37]
A
Let's go into a black mirror hypothetical in which the job gets automated away. Right. And suddenly they find themselves without a job and at 53, they feel as though they can't retrain or they don't want to retrain, but they don't know what else they could possibly do because they don't want to become a veterinarian.
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B
Yeah, of course. You said a lot that I want to explore. I want to first propose that we rephrase one of the critical natures of the question. You said the black mirror outcome.
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A
Ooh, okay.
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B
You said the black mirror outcome where we automate legal services. Is that black mirror. And by the way, I'm not proposing that I want all lawyers to lose their jobs. I want to be on the record on this. It's not that I want people to lose their work. I also am pretty eager to find a world where we much more efficiently litigate things. The cost the industry that is tort law. We have forgotten how expensive it is, the prices that we all pay in various ways. It's just a tax on all goods and services. Because any given company can be sued at any given moment by any number of people mean that the insurance against that company and the risk against that company means they have to pass a bunch of other costs to us. And this is everywhere. I mean, this just exists all over the place. I'm not sure a world where we automate legal services is not a much better one. Now the world where everyone loses work and we don't know what to do and it becomes very scary, I agree. Can feel very black mirror in some respect. But I am very excited to discover a world where we can spend a lot more of our time doing much higher value things. So let's come back to that. Now as for the 50 year old lawyer, 53 year old lawyer, a lot of things have to be true in order for a 53 year old lawyer to lose their job to full automation. Right. Presumably you're around the peak of your career. Just for the sake of the argument, are they at a partner at a law firm or they're their own practice?
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A
Let's say that they spend most of their time doing minor trademark filings.
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B
Okay, so it sounds like maybe they've run their own practice.
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A
Yeah.
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B
One day they realize all of their clients have figured out that they can do all their trademark filings with ChatGPT or with some future state. And all their clients have said, in fact, we don't even need a CYA attorney anymore, we just don't need you. And this person sort of looks around and says, wow, that's bad. In order for that to be true, a bunch of other things would have had to happen with both the rate of scientific progress in AI and also societal acceptance of all these other things, such that presumably this person, this lawyer would have discovered that this was true for all the other things that they were buying. It's very hard to imagine a world where one service becomes unnecessary, but every other service doesn't. Now, in a world where it's just the attorney and just the trademark attorneys, I agree we have a distribution problem and this is one of the things people talk about. A world where one part of the economy figures out it can be automated very easily or people figure out it can be automated easily and that part gets hurts. Special interest protects the rest and science doesn't update to automate the rest. I agree that's tricky and I don't actually have a ton of answers for that. Some of this we're going to have to explore as we get there. And I don't mean to be hand wavy.
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A
Right.
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B
But if you get past the distribution problem, which is also sort of, even as you play it out a little hard to imagine, it really does actually become a much bigger question, which is how less expensive is this attorney's life now that they figured out everything around them is automatable, meaning how many hours a week do they actually need to continue working? Or how many hours do they need to bill in order to cover the costs that they've always been paying for and other things. The reason I bring this up is because what I think people often sort of forget about is most of the value in automation accrues to the professional services of people who are purchasing those goods and services. And it's always easy for us to be like, oh my God, what if my job automates? And then really fun to be like, oh, what if all these other things automate so that I don't have to spend all this money and time now, in a world where we start to explore this, in a world where lots of things start to automate, such that we have a deflationary event, which I think we will. That's my hot take. It's my hottest take, by the way. People hate this idea. Yeah, what do we do about work? Like, what do we do about what's next? And if you're a 53 year old, you're still in your working prime. And our intellectual primes are extending much further for all sorts of reasons. My challenge is whatever got you to this point, whatever you did in life, to sort of find the eagerness to explore something like trademark law still lives inside you. You don't have the same neuroplasticity, you don't have the same natural inclination. And you sort of put that in the back burner. And most people are actually quite capable of reinvention. This is a really amazing thing. And we love the stories about reinvention. We love Hollywood films about people who rediscover themselves later in life. And we're always inspired about the idea that someone else could, even if we can't or aren't able to. And I am very impressed when I ask people what else would they do? Lots of people have very good answers and they're usually wonderful. They usually also point to a happiness function. They usually point to what someone would do if they could redesign their life around joy. And not to call out attorneys. But I'm often struck, next time you're with an attorney or a group of them, ask people for their passion projects. You will be blown away at how many attorneys have exceptionally interesting passion projects, because they're all very smart people who are very good at sort of exploring ideas. And they got into law and realized that it didn't scratch the itch. Maybe they thought it would scratch. And so they became Chefs, or they became, you know, exceptional banjo players, or they started building log cabins. You meet these people and you're like, oh, you're all going to be fine. Actually, you're already so eager to find a thing that satisfies your soul and spirit outside of law. I'm far less concerned about these people than I think many people are. I think attorneys in this world where their work automates know what it's like to put in a lot of hours. They know what it's like to go to law school. They know what it's like to study for the bar. They know what it's like to log a lot of crazy hours for their clients. They know about hard work, and they also know about the possibility of building something from nothing because we're constantly setting new precedent and creating law. What's tricky for me is to imagine the more intrinsically motivated or sort of like the jobs that actually provide people a lot more identity. Because I think actually lawyers find identity in other things than being lawyers. I mean, at first they get their law hat and they go, I'm a lawyer. But by the end of their career, they're like, I'm so much more. You know, I'm in a rock band. Right. By the way, every great law firm has a big rock band. This is true. Like, all the, like, the top 25 law firms have these rock bands composed of partners in the firm. And sometimes, like, an associate is a really good drummer and so they get to join the band. But this is like a thing.
- [19:22]
A
Is this like the Goldman Sachs CEO is also a dj?
- [19:25]
B
Yes. This is a separate issue. I think he's looking for, you know, everything's a club. This is. We will talk about this later.
- [19:32]
A
Later. All right.
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B
But my expectation is that for a lot of people, rediscovery will be somewhat joyful. Quite frankly, I think we're so scared of rediscovery because of our status quo bias. But I think for a lot of people, it will be joyful. What I worry about is the people for whom the work is core to their identity. It's not just an economic outcome. It is super core to their identity. And for a lot of these people, and I actually often observe that accountants are these people. I don't know why, but accountants. Actually, I do know why. There's a lot of research that suggests this. Accountants love the numbers. Like, they get into it because they love numbers and they like this work. And I'm more concerned, quite honestly about the rediscovery of the accountant and the CPA who I also think will be fine because we are good at rediscovering ourselves. But there is going to be jobs that are more aligned to sort of personal reawakenings.
- [20:21]
A
Right. What I'm hearing you talk about is a future in which under this hypothetical, due to advancements in AI, a lot of people essentially reach the early retirement problem. And often in early retirement people then are faced with, okay, who am I now that I'm not a lawyer? Oh, it turns out I'm a stand up comedian. What I hear you describing is a world in which more people kind of reach those self discovery questions that are common in early retirement. What if that 53 year old, even though the rest of their life has the cost of living, has deflated and the rest of their life is cheaper, they still either need to or just want to continue earning an income. And they can't do that from playing a banjo, being a stand up comedian, building log cabins with their hands.
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B
I don't want to actually sound like a naive or an and suggest that no one needs to work as soon as some work automates. I'm simply suggesting that the practice of rediscovery may be exceptionally challenging, but also may be welcome in some cases for this 53 year old attorney. Again, so much would have to be true in order for trademark law to be fully automated. And that's the thing we have to remember. And by the way, it's not just a technical issue, it's a societal issue. One of the things we write a ton about is societal thresholds and technological thresholds. Technological threshold asks the question what can a machine do? Societal threshold asks the question what do we want a machine to do in order for a job to fully automate, you have to meet a lot of societal thresholds along the way. Right. Like what would it take for you to fly in a plane that didn't have a pilot?
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A
Wow.
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B
A lot. You don't even have to answer it. I just throw it out there. My point is, can planes fly themselves? Yes, absolutely they can. Do you want to get in a plane with a pilot? Yes, you do. This is one example of many societal thresholds. Pilots are not at risk of being automated. Not because we can't fly planes automatically and remotely, but because we don't want them to.
- [22:12]
A
That's true for now, but there was a time in which people didn't want to go on an elevator that didn't have an elevator operator. Yes, right.
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B
This is one of my favorite stories. Let's come back to it in a Second, because I don't want to lose this thread, my point is simply that societal thresholds exist, and they exist for quite some time. What I'm proposing though, is the societal threshold that you are describing is my favorite to teach people about. In 1854, Otis Elevator invents a modern, what he calls people mover. Prior to this, we move people up and down mine shafts and tall buildings with rope and pulleys. We could do it, but it was very dangerous. And rope and pulleys often broke. And then the machine plummeted and suboptimal outcome for the people on them. And so only the brave went on these people movers. And so Otis, staring at these things says, what if we just created a fail safe? What if we created a thing that catches the rope so that when it breaks, it doesn't fall? It's basically a second parachute and it works. He has this massive breakthrough and he's like, oh, this is work. And he puts it in this. Like it basically requires to go in an elevator shaft because that's how the system works. And so he invents is a modern elevator, you know, the first elevator. And he sells a bunch of them, sells tons of these elevators. By 1855 or 1856, a bunch of these buildings are calling up and complaining. They say, hey, no one's riding the elevator. It works. But people are terrified they're going to die. So Otis has a problem. He's met the technological threshold. He's built a machine that works empirically. It moves people up and down safely. But he hasn't met the societal threshold. He has not convinced people that they should ride in it. So he does three things to convince people to ride in the elevator. He puts a mirror in the back of every elevator so that when you walk in, you'd be a little distracted by your own image. He puts music in every elevator so when you walk in, you'll be entertained. And he puts an operator in the elevator, puts a physical person in the elevator to convince you that it is safe to ride up and down the elevator because a human's in charge. And it works. Moves the societal threshold. Today we ride a bunch of elevators. And to your point, societal thresholds do move. Not all of them, by the way. There are plenty that have been stuck for a long time. Nuclear power is a great one. It's a societal threshold that actually moved and then moved back because of the Three Mile island and Chernobyl and Fukushima. DDT is an example of a societal threshold that moved back for good. Right. We discovered, hey, this thing works, but it comes at an incredible cost. We don't want it. And then we have a bunch of societal thresholds that sort of float around. GMOs and CRISPR are great examples of technologies that work really well. And we're like, God, I just don't, you know, we don't know. In some cases it's reasonable, you know, ethics and playing God. In other cases it's mostly bad public perception. I say this because just because a machine can do something doesn't mean it will. And you point that out very well. And I think we should recognize that so much of the work that we do today may in fact be protected by just the rate at which society wants to, to change. Taxi drivers sort of are screaming right now about with the Waymos, 1.3 million people die on the roads every year globally. And it's very easy right now to look at the taxi drivers and say, those poor guys. And I'm like, yeah, I agree. I feel bad for people who lose their jobs. And also I would love if no human ever drove a car again. Those two things can be true. And then what it points to is this bigger question about the 53 year old attorney or about anyone sort of on this path, which is in a world where all progress has cost, where we are trying to build a better place collectively, what is the limit to automation? In a world where we can automate everything, where do we stop? Where should we stop? And there are plenty of no go zones, in my opinion, plenty of them. And what it points to is actually a world where we should start to really emphasize the work that humans and our immutable qualities are particularly well designed for. Which might not be patent law, it might not be trademark law. That might be great for ChatGPT coaching, teaching, elder care. I mean, there is a slew of work in the world that we undervalue today, that we could overvalue, we could afford to overvalue, where we could find more people to do more quality work because we just have cast off these jobs for a long time as being less than this to me, points to a much bigger sort of awakening of some kind, a renaissance of some kind, where we start to actually recognize the work that machines should do and the work that humans should do and put much more of our attention and effort on the work that we are uniquely adept at doing. Which I think by the way creates not just a better world for the people who are getting receiving the work, but also a better world for the people who are doing it because I think there's just an exceptional amount of value that we can see that come from creating and building and helping people.
- [26:34]
A
How does that square then? When I think about the again, this 53 year old attorney, one thing that strikes me is that this is a person who has devoted a lot of their youth to going into a field that has high barriers to entry. This goes back to what you said earlier about everything as a club. There's a certain professional pride that you get when you are in a field that has high barriers to entry. But necessarily, by definition, those are fields that are incredibly hard to train in and that take many, many years of training. If this person, this 53 year old attorney, were to retrain into something, if they wanted to go into another field that had high barriers to entry, that would necessarily take a long time and then they would be 58, 59 by the time they were done with their training.
- [27:21]
B
Totally. And what's really cool, again, if you're willing to explore this world where trademark law and patent law gets automated, it also means that barriers, if you're automating patent law and trademark law, you're lowering a barrier. And the implication is that we're lowering a bunch of other barriers. Now, there are plenty of things that should have barriers, there are some credentials that really do matter a ton, and there are plenty of things that shouldn't or don't need them. And in a world where we have a million, by the way, a million attorneys in the United States, a little more than 150,000 therapists, we've clearly overvalued tort and undervalued mental health. Right? Something is weird in this balance. And for whatever reason, we don't actually regard the therapists with the same degree of sort of appreciation as we do other professions, when in fact we could, we could realign our values. What I think is very exciting about this is that in fact access to various services, bringing down the barrier to lots of things, isn't, you know, this one the spirit of your show and your podcast, but also like the spirit of improving the human experience. I acknowledge first of all, that it's not even the 53 year old attorney that we should be most sympathetic towards. It's probably the 28 year old attorney. Let's imagine someone on the cusp of becoming a partner who has grinded through undergrad, grinded through law school, grinded for the first six and a half years of their associate and VP status at a prestigious law firm, spent 100 hour weeks doing the Work that someone else is taking credit for just to become a partner so that they can get paid all the money and take credit for someone else's work and then we automate their practice. That person I feel so bad for, and also I think they're going to be okay. I believe that the qualities that allow that person to achieve what they got will allow them to achieve something else. Exactly what it is, I don't know. But we have already started to see a new interest in a new exploration of work that we've wanted for a long time, that we're continuing to add to. And again, I talk about teachers and coaches, but people working with their hands. Skilled craftsmanship is in incredible demand now. And I'm not saying that everyone has the dexterity to do it, but if you ever wanted to be a carpenter, if you ever wanted to be a chef, if you ever wanted to work in bespoke services, it's a pretty great time to do that. There's enormous demand for it. People, you know, I meet plumbers and electricians all the time who are doing like really interesting work, who are also making way more money than I think anyone fully realizes, who, like, are turning down clients constantly. That work is not going away anytime soon. Moreover, even when we automate a lot of work, you know what we do? We just reinvent new luxuries. Budweiser was supposed to make the craft breweries go out of business. That was the whole thing. We'd been making beer and everyone was like, oh, now only one company's gonna make beer. All Budweiser did was create a new degree of luxury. You can drink a $1 lager and still we go to bars and order nine dollar lagers. We're like, oh yeah, I'll take one of those really fancy beers. It's just staticing. It's just opportunity to sort of find new luxuries. And then all that we've seen is this major huge rise in microbreweries. And obviously that's changing a little because the younger generation seems to be drinking less. But in a world where I can buy any jeans, I can buy Levi's for, you know, whatever, $25 at Costco. I buy these, which are much more expensive because, you know, there's a status to it. I mean, it's just, this is like what we do and that creates these new economies all the time. I try not to be flippant and I really try to acknowledge that it can feel very scary. But in a world I would say to any individual where Your job fully automates. Something incredible has happened where society has adopted an interest in automating a bunch of other things. And you are probably as much a beneficiary of that as you are an economic consequence. The big question that I keep coming back to is, even if there is more and better food on the table, even if you can find another way to sort of make ends meet or even do better than that, can you be happy? Can you find joy in a world where it is much harder to attach your identity and your purpose to the work you do? That, to me, is the biggest outstanding question for everyone, because the logic goes like this. The logic is, in a world where machines get really good and really cheap and they take all of our jobs, and what will we do for money? And if we don't have money, what we do for food? And I'm like, think about it. If you play that out, that's not actually how this goes. If machines actually take all of our work, something profound will happen economically. Now, I don't know what that world looks like emotionally, spiritually, but that's not our concern anymore. There's something bigger happening right now, which is we actually have to ask ourselves, like, you know, what does it mean to be human in a world where you have attached so much of our purpose to the work we do, extricating that's just going to be a lifelong pursuit of many generations. I think.
- [32:28]
A
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- [36:24]
B
Not almost. That is exactly the right.
- [36:26]
A
Right.
- [36:26]
B
Yeah, that's exactly right.
- [36:27]
A
So if there is a vacuum of work, we will figure out more work to do. What could that look like? Are we talking about building underwater cities? Are we talking about.
- [36:36]
B
Okay, first let me say this because everything I say from here on out, I mean, people already think I'm naive, which I'm willing to be accused of. Optimism is very easily construed as other things. But if you had told Phil Knight. So Phil Knight starts Nike in 1971. And Phil Knight, by the way, has been ambitious since he was born. Phil Knight came out of the womb being like, I'm going to take over the world. You can see it everywhere, right? He's turned Portland into something. Even what he's done with the University of Oregon, by the way, Shoe Dog. Obviously you've read it. Amazing book. One of my favorite business biographies. If you'd asked Phil Knight in 1971, how is everyone going to buy Nikes? How's everyone gonna buy these shoes? He would've said, we're gonna open stores everywhere. We're gonna open a store everywhere on Earth. And he did. Basically every continent has a Nike except Antarctica. He could not have fathomed in 1971 or 1975 that Nike.com was gonna do $8 billion of revenue of the company's 24 billion of revenue in 2024. And if you had been like, hey, let me explain something to you, he would have been like, I'm not sure I understand. Thank you. Let's come back to that later. I mean, Honestly, even in 1995, that might not have really resonated with him. It's like Bezos saw this, but how many actually understood what E commerce was going to become? And I even remember people talking about mobile as being this, oh, it's a fad, but no one's going to buy.
- [37:54]
A
Things on their phone right now.
- [37:56]
B
I say this not to tell an old trodden tale, but to remind people that we have to have some humility when we talk about a future. Because if visionaries, business visionaries like Phil Knight struggle to imagine the ways in which their companies are going to make money in the not too distant future, we need to be honest about the fact that we can't possibly be sure how businesses are going to make money in the not too distant future. And the agentic web introduces all sorts of possibility roles like the social media manager, a podcast host I mean, these aren't things that we could have properly understood 25 years ago. Now, that I think is an important reminder as we start to explore ways in which we will work. Because the presumption that all work will be automated, I think is also a really silly one. To your point, we are going to find other things to do. Some of these things may be around new luxuries, new bespoke services. Some of these things may be around traditional or more commoditized services that we simply decide we don't want to automate. And this will be ours. But I will sort of frame it in the following ways. My expectation is we're going to have new work, as I call it, on sort of two basis. One, work that exists today that we don't actually. That we can't imagine spiking massively in demand. My favorite example of this is a chef. When I talk to people about cooking, or most people I know who are interesting, this isn't fair because I don't actually like cooking. I know a lot of people who describe cooking as one of their favorite hobbies. One of their favorite hobbies. Now, admittedly, a lot of chefs, and the bear presents this very well. Don't love the actual job of it, but most people. If you said, if you could make a good living doing this, would you? A lot of people would seriously entertain it. They're like, oh, I like cooking for my friends and family. I could run a kitchen. There's an enormous demand happening right now in the backdrop of the service economy for chefs. It's actually quite remarkable. More and more people are dining out than ever before because we actually, it turns out, have more discretionary income now. We should come back to where we're feeling a crunch, because that's super important here. But I do wonder if, like, the things that we sort of talk about as being these fanciful jobs, you know, in another life, what would you have been? Oh, it would have been fun to be a chef. I'm not sure that we won't actually start pursuing these things in earnest. That like being a coach, being a teacher, being a chef. Again, I keep coming back to these roles that are uniquely human, that are in, like, exceptional demand for high quality individuals and that we do not want to automate with machines won't actually become sort of the basis of the next economy, a service economy.
- [40:31]
A
But don't we already see coaching, teaching, and you mentioned earlier, therapists. I mean, we see woebot, for example. Wobot is your AI therapist.
- [40:40]
B
Yeah. My opinion on this is that there's a lot of things that AI can do. We wrote a newsletter about this. There is a ton that AI can and should do to support our spiritual, emotional, psychological awakening. It exists at the intersection of better understanding ourselves. There's a corpus of data that you have compiled, Both in your ChatGPT instance, but also on the Internet that could be assembled in a place and asked very interesting questions of. And I have a prompt that I'll share with you that you can give to listeners to put in ChatGPT that will provide an example of this. I don't think it actually is a replacement for human interaction with. What I think we've done right now is we've taken ChatGPT in many cases and treated it as a hammer and everything looks like a nail, right? We're regarding it as like a close combat weapon. That's not the optimal use of this. The optimal use of this is for it to make sense of incredible reams of information, to find the nuggets of truth and really interesting distillation, and then to spend time with individuals and people who are trained in the art of therapy or in the practice of it, to help us. The current wave of sort of treating AI as this like silver bullet is dangerous. And now obviously a lot of people can't afford therapy today. That's a separate issue which we need to address, which is a supply issue. There are not enough good therapists in the world relative to the total population who wants them. This is something that we know. But again, I'll point back to this. I'll use me as an example. I don't want to make this too personal. I don't want to see a robotherapist. I want to use AI to deeply understand some incredible truths that a therapist could not have unearthed and then spend time with my therapist on these things. Someone who can set boundaries, someone who can intuit my voice and intuit my body language, who can tell me no, who can refuse prompts very, you know, very willingly. This is important. And I think losing sight of this is important. And you'll hear me sort of find a backstop against many of these applications. But again, there's a lot. You can extend this pretty far. I mean, I think what we are going to discover is there is a limit to a lot of automation that we are willing to accept. In a world where you could automate everything, just take this to the limit, where would you stop? You don't have to answer that. But it is a question for everyone. And I think we are collectively sort of starting to ask these questions. And I think the backstop is, is much further than we realize, but actually not as far as dystopia. There is a place where we say, you know what? No, this is like this experience matters. This I do not want to get rid of.
- [43:13]
A
You talked about supply and demand. You personally don't want to see a robotherapist, but there's some proportion of people who seek therapists who are willing and able to seek a robotherapist. If the demand for robotherapists ends up exceeding the supply of therapists, then we have, which it has, right? Then the supply demand imbalance, it kind of tips in the opposite direction. Where we started pre AI was that the supply of therapists could not meet the demand of people who wanted it. And now what we're starting to see is an inversion of that. We can imagine this. You know, you personally may not want that robotherapist, but if enough people do, then that could dramatically upset the practice of therapy and the profession of therapy as a whole.
- [43:59]
B
Well, I don't, that's not how I see. I mean, I think the commoditization of most goods and services ends up just creating new bespoke again. It's like the diner just led to this massive spike in Michelin star. Like fine dining exists because so many people can eat out next to nothing. I mean, the reason that we keep creating these very expensive experiences is because we keep commoditizing other ones. The five star hotel and resort is constantly trying to reinvent itself because the four star resort is constantly improving its experience. Because the three star resort is constantly improving its experience. Like my dad traveled with me very recently and I flew him luxuriously and put him up luxuriously. This is a doctor who has done well for himself but has never really done very fancy things. And he looks around and goes, holy, this is nice. Because this is a guy forever who like has just. It was like, whoa, when did everything get so fancy? We take for granted the reason most things have gotten so fancy is because the baseline of things is just always getting better, always getting better. And that the four star hotel today is what a five star hotel used to feel like. And we're just constantly trying to toggle how much more. I mean the Bugattis and the Koenigseggs, these cars that have 2000 horsepower because Corvette produced a $100,000 car with 1000 horsepower or Tesla made. I mean, it's like Elon Musk has forced all these people to recalibrate what fast is. And everything is just getting less expensive. And so we're constantly trying to invent new luxuries. And I remind people of this because I don't think people at the limit of their practice. The bigger issue, I would say is not actually, are we going to automate the therapists? I don't think that's going to happen. I think that the market for people who want personal therapy, good personal therapy, is going to expand and already is. My real concern is how do we help people believe that they should see a therapist, not a robotherapist. How do we create a world where people can. And this goes to a theory that I have called dehumanization, which is the concept that at some point we are exploring a world where an individual is at greater and greater risk of having more interest in a virtual reality than a physical one. And the concept of dehumanization actually plays on now two major risks associated with AI. The first is device addiction. Just people are fascinated by their device and need to be on their phone constantly. And the second is what we're sort of broadly calling chat psychosis or chat infatuation. Her right. Falling in love with a machine, Harari talks about. The latter talks about bots should not pretend to be human and we should not allow machines to anthropomorphize. I agree with that. I believe that we should actually policy, self regulate the company should and policy a restriction on what we allow a machine to pretend to be. And we should fight corporations interest in naming them and treating them like people on the other side. We need to have an honest conversation about the fact that the device has, you know, we are coming to pay down the debts of device addiction, especially in a younger generation that is far more anxious and reclusive and isolated and depressed than prior. That to me points to an issue that actually stares us in the face today way more than identity displacement. How do we create a world where people are more interested in a physical reality than a virtual one? When parents are like, what about my job? When people are like, what about Terminator? What about the misaligned superintelligence? I'm willing to have these conversations, we can talk about these things, but dehumanization is the one staring at us right now.
- [47:30]
A
Right?
- [47:30]
B
And that honestly is a policy issue, but it's also an alternatives issue. We have to build physical worlds that people are excited to live in. The most noble thing I think we can do now is reinvest in the physical society that we have long forsaken suburban sprawl. The average American does not live within walking distance of their grocery store or coffee shop highways. These like 12 lane monster highways that are just destroying arable land and park zones, creating spaces, reinvesting in the spaces in which we live so that children can find a renewed love for nature. And the world, to me is just the most important thing. And actually challenging people to focus on their local politicians. Everyone wants to talk about D.C. i get it. I mean, there's a lot to talk about. If we all just started holding our local politicians more accountable, electing people who are committed to building, to investing in physical spaces that we all love to be in, and holding them accountable to do so. Wow, we would make a lot of change really quickly. And that to me is the most important way that we can fight this threat of dehumanization which we've sort of roundabout gotten to, which is, why do so many kids want to talk to a chat bot rather than their friends or a therapist?
- [48:40]
A
Well, I mean, I think to that question, why do people want to talk to a chatbot rather than their friends or a therapist? Therapists cost money. Friends are judgmental, chatbots are neither. And so to that end, I think there's a lot of promise that people feel when they talk to a chatbot. You see this on south park, actually parodied very, very well on South Park.
- [48:58]
B
It's reducing a degree of friction that exists in a healthy way where your therapist draws boundaries and your friends actually push back and people want something that is more frictionless, which I get. But I think we are going to discover that there is an exceptional cost to that and that we want to reinvest. I think the younger generation is particularly interested in this in a way that an older generation is not, because the younger generation has become particularly infatuated with interested in a virtual experience. And this I think we should describe as a problem to solve in the immediate sense the way we described smoking and alcoholism, right? In the 50s, a lot of experts looked at the United States and said, oh boy, we're all going to die of lung cancer and liver failure if we don't correct this. And we went about ways of changing public perception and then also policying some pretty important decisions. And within two generations we see people that don't want to smoke or drink at all almost to a sort of ridiculous extent. And I'm like, yeah, we need to start regarding device addiction and virtual infatuation the same way we actually have to treat this as a societal epidemic, right?
- [50:03]
A
I mean, the virtual Infatuation. It doesn't surprise me that I can see how the thread would be drawn from the pandemic era where people were going on zoom dates, to the post pandemic era of having an AI boyfriend or girlfriend. You know, there's a natural progression when you've spent two years going on zoom dating. For people who are single during the pandemic, there's a very natural progression from that.
- [50:26]
B
The zoom dating one is like an obvious. Yeah, like, I think for a lot of people, that's like, dystopian. And I would say it even slightly differently. During the pandemic on a Friday night, you didn't ask yourself, do I want to go out or not? Like, you weren't even making a call. It was just like, look, now I stay inside. And the recalibrating over two years of basic habits, like, should I go outside or should I stay inside? To. I'm going to stay inside. What should I do inside? That's a pernicious cycle because it means that the default setting is inside. The default setting is device. And the lucky ones in the pandemic. And I say lucky because I remember. I mean, it's not like I didn't live through this. It's the lucky ones, not even the smart ones. The lucky ones found habits and hobbies that didn't require their screen. And I say lucky because some people were very deliberate. But a lot of people just got, you know, they found baking, or they found pottery, or they found crocheting. Good for you. You came out unscathed. And for a lot of people, it was like, no, I got really into Netflix and I watched every show, or I got really into video games, which, by the way, I did. The last video game era of my life was during the pandemic, and I was playing, I know, probably three or four hours a day with some degree of shame. Quite honestly, I don't think I've talked about this a bunch of. With some very close friends. And the day I put that controller down during the pandemic, it was the last day I ever picked it back up. I realized in that moment, like, this was a very scary trend. I was like, I don't want this at all. I don't want to do an hour of it a day. Like, this is not how I want to spend my free time. And then I started to occur to me, like, how many other people have rewired, reconditioned themselves to believe that this is a day that is haunting and it's not anyone's fault. Then we also did a lot of things that just perpetuated this. I mean, this incredible moment where algorithms got really good and we started preying on people's attention. And so I think the confluence of events and of course zoom dating is sort of one of these. But it's just like we recondition ourselves to believe that the device was how we should spend our time. And in fact, I think we're going to look back on it the way we look back on smoking and drinking heavily during pregnancy. Not only should you not really do it at all, we did it unabashedly, like we always like. Yeah. And the consequences were very real. And the consequences, I think, for this generation will be real. The good news, we're good at solving these problems. Like, I actually have to remind people constantly, we are good at solving these problems. We create problems for ourselves. And within a generation we've already seen it. Gen Alpha is going outside more. They're returning to the physical spaces. They're talking about the Gen Z ers as screenagers, which is, you know, borrows this popular term. And parents are describing it. Younger millennial parents are sort of describing the difference and their kids. I think it points to a correction.
- [53:00]
A
Well, and I think the fact that the 90s is so back in vogue. I mean, you look at fashion choices, right? The fashion that's in vogue right now is the fashion of the 90s, the wide leg jeans.
- [53:09]
B
Yeah, my jeans speak to it.
- [53:10]
A
Yeah, exactly. Everything that people wear today is just an echo of what people wore in 1992. And we see the same thing in terms of the phone cases that are designed like cassette tapes. All of this nostalgia vibe that is back in vogue that really harkens back to the 1990s. I think there's a group of older millennials who are like, really? We lived through this once. We have to go back to wide leg jeans again? Are you serious? But I think that that hearkening back to the 90s is a hearkening back to a time before smartphones and Internet and email began.
- [53:46]
B
Yep.
- [53:48]
A
So on one hand we see that. On the other hand, you've got Yuval. Noah Harari talked about how text based religions, such as the Judeo Christian religions. What does a theologian do? A theologian is a scholar of these religious texts. And now AI can do that. And so people, you know, you talk about what we once thought of as perhaps the most sacred human thing that you could do, which is read deep religious texts, is now something that AI can actually do better than a Human could and AI can scan. This is specifically for text based religions, but AI can scan far more text than a human ever could read in their lifetime and mine it for the wisdom that it is supposed to contain.
- [54:38]
B
Yeah, I mean, look, Harari is brilliant in the way that he sort of composes a narrative against so much information. And I think it's what makes him such a popular writer and thinker. And I agree with a lot of what he says. His conclusions in Nexus I don't necessarily agree with, but I would also sort of pull on the thread which is so what? Like actually, and I don't mean this sort of flippantly, in a world where you had to work really hard in order to know something or understand something and that's going to become less true. Let's call it unmetered intelligence, which is the term I use to describe this. Over the last sort of 3,000 years, a little less a thousand years, in the pursuit of our intellectual wisdom and knowledge, we have forsaken our physical bodies. One of the things that he talks about is we were much stronger. Our ancestors were much stronger on a relative basis than we were. And actually far less fragile. I mean, they died much more horrific deaths, often earlier, but that was because they were living in the wild with not much. We've done all these incredible things to extend our life expectancy, but actually we are unhealthy. We are an unhealthy species on a relative basis that's just doing all these things like manufacturing all these ways to live a lot longer. And my point is, what if we are now going to flip the script back? What if we're no longer competing on an what if for a while now? We're not going to compete on an intellectual basis, we're going to compete on another basis. Because the other thing that I argue is in a world where we have put so much emphasis on the pursuit of knowledge and wisdom and intellect, we have also, in my opinion, forsaken the spirit and the emotion. I think that we are far less empathetic and compassionate as a species than we've probably been in some time. Even though we've dramatically reduced things like violent crime in this world because we are so dependent now on these institutions to set all these rules. And because we've become so competitive on an intellectual basis, it is why often people remark, if you are very kind, oh, that was a very nice thing to do. Because the expectation is that we are rational economic actors, not rational emotional actors. Rational, compassionate creatures. And people describe feeling like they live In a world that is so polarized and so sort of angry. And my argument is, okay, in a world where we actually solve for unmetered intelligence, where we actually create a world with abundant access to intellectual. It's true that combing through a religious text may be so easy that we experience some form of idiocracy, some form of, well, I don't have to think very hard, so I won't. Right? I'm just going to turn off my critical thinking mechanism. Something else actually will take its place. Humans are competitive creatures. Something else comes from that. And I'm not sure based on the evidence that that other thing is not either physical attributes or even emotional or spiritual attributes, that in a world where a lot of hard thinking is solved, where a bunch of very complex cognitive reasoning can be done instantly, if you and I cannot compete on an intellectual basis, are we not just going to try to be nicer and funnier? Is there not another thing that comes next? I don't think that the answer is we become zombies. I actually think the answer is something far more interesting that we have to get to. There's an arrival here, but I'm pretty eager to live in a world where you don't actually do better or worse than someone because you are so much smarter. I'm much more interested in living in a world where you do better because you have more agency, you're harder working. There are other human attributes that we have long disavowed that we might actually bring to the surface again. And that would probably, I would argue, reward a more compassionate, well adjusted, well aligned human. Because winning on a basis of intellect alone does not necessarily reward the best outcomes. And this we have seen time and time again. Yes, and is my point, yes, it seems possible that knowing everything is, you know, is in some basis or you know, it will become very easy and that that pursuit will matter less, but something will take its place. And I think that could be really exciting.
- [58:50]
A
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- [61:35]
C
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- [62:41]
A
I want to turn the conversation to money. Because AI has the potential to rewrite much of the relationship that humans have with money. There are many facets to that. There's of course, the mechanisms of how the financial system works. But then at the individual level, there's also financial literacy. There are the jobs that right now are held by CFPs, CFAs, by a myriad of professionals within the financial services system. So I guess I'm starting Broad and I should narrow this down in order to formulate it into a question. But what are some of the key points that you see in how the human relationship with money will change?
- [63:23]
B
I'll answer that, which is as much as anything we've discussed, probably philosophical. But first, let's call back to what we talked about earlier. So you said, Listen, the 53 year old attorney, their job gets automated, Okay? I said, well, what other jobs get automated? You say, well, fine, maybe an accountant's job gets automated. So now I'll come back to explaining why that means pretty good outcomes for most people in the United States. If you want to know a lot about the tax code, you need to hire not just a CFA, a very good CFA and CPA probably. And they need a team of very good CFAs and CPAs because the tax code is a mess. To put it kindly, financial illiteracy isn't just a problem. It might be the problem because whereas with healthcare and education, the two other broken sectors in the economy or in the world, arguably, you know, when someone's beating you up, most people when they stop and think, why can I fly across the country for $80? But if I go to the emergency room, I might be bankrupt, right? Like a van ride, literally, a van ride to the emergency room might bankrupt me. People can think about that and appreciate how crazy it is and it beats them up with it. It's a punch in your face and you're like, I don't know why this is the case, but I know it's broken. Financial illiteracy plagues people in another way because it's an Insidious actor. $11 billion in overdraft fees last year. Most people have no idea how much they are contributing to the bottom line of banks who are preying on their illiteracy. Predatory lending, credit cards charging people 30% and just every month, just taking a little bit, and then you turn around, and after a few years, you've paid a credit card company $50,000, some egregious amount of your net worth because you're not even aware. And for some people, like, well, that's because everyone's indebted. And I'm like, that may be true. And then we need to figure out how to get people to stop doing frivolous spending. And people. This is where people get really upset. Well, everyone should be able to afford anything. Well, it's okay. There are some luxury goods that credit card companies are letting people buy that we probably shouldn't. And my point is, like, if you knew that purchasing this bag didn't cost you $1,000, it costs you $15,000 after you were done paying it down, would you still do it? And the hard part today is I think most people are not actually making the calculations because some of these fees are hidden and some of these fees are so convoluted, like taxes, that it's impossible to know. And my argument is one of the amazing things that AI does, it doesn't rewrite the tax code. It just shines an enormous light on it. Because in a world where you can take the tax code and put it into ChatGPT and say, hey, help me make sense of my taxes, you'll quickly find out that, in fact, you are paying probably depending on your tax code, way too much on some basis and have been doing so for some time. And for a lot of people, it's going to be like, all right, let's sort this. And for a lot of other people, it's going to be like, why is this so messed up? The tax code has always been this issue that I think the wealthy have been really upset about and spent a bunch of time talking about. And I just don't understand why more people don't. And I'm not talking, by the way, about the tax rate. That is a separate debate. We can talk more about that. I'm talking about the code itself. I'm talking about understanding how. How the financial system works for most Americans or most people in the world. And the literacy that AI expands. The opportunity that AI offers someone to understand personal finances, macro finances, investment advice, et cetera, et cetera, becomes pretty incredible at the limit. It also has some weird implications, by the way. Like, right now, it seems like there's an argument to be made that Matt Levine made recently. I don't know if you saw this. Matt was like, he has a sinking suspicion that Chatgpt is actually moving the markets. And a lot of people every day probably say, where should I invest my money? And it's giving a recommendation and then they're playing that recommendation and then that's moving the market. So it's actually informing the model. It gets a little weird and I'm like, okay, I agree, that's strange. But I also am like, the number of people who are like, hey, help me make sense of this credit card fine print. Help me actually spell out how long I'm going to be paying down if I make this much a month. How long am I being paying down this debt? Just like every day you hear about these horror stories of people who discovered that they're underwater on their car, they're underwater on their education, and the predatory lending and debt that afflicts a lot of people. A lot of it is because we don't know. A lot of people have just taken money they didn't know they shouldn't take because the system was designed to give them money. Right? They want to borrow. You know, they want principal and interest against that. Fixing that is like a number one in fixing financial services. It's not about realigning incentives. I'm not proposing that we could realign incentives tomorrow and have everyone in Washington D.C. care deeply about the average American. But I am proposing that people will find out quickly how much they are being preyed on. That knowing in this case is more than half the battle. And discovering ways in which you can actually start to unpack all the debt or unburden a bunch of financial obligations that you don't want, I actually think solves a tremendous number of problems. Now the other two problems we have to talk about are education and healthcare. And just to go back to the relationship to money, we live in a world as you and I described earlier, that is so unfathomable on every basis. For our great grandparents, I mean, like most of the things that we enjoy on a day to day basis, you couldn't have even described to them for most what you and I described as discretionary. But it's probably even more than discretionary. There are food stuffs that are less expensive, it's lots of stuff that's less expensive. We live very luxurious, bountiful lives. This is where people feel the pain. This is the burden. This is the burden of living, particularly in the United States, but also most of the world. Our relationship to money right now is so inextricably connected with our relationship to our housing, our healthcare and our education that it's Charged because everyone is feeling like they are further from the thing, even if the rest of their lives are getting so much better. And I think AI does two things. First is it shines a light on these things. It shines a light on the brokenness of these institutions. The second thing is it makes everything even more inexpensive. And so in industries that are not prohibitively broken because of special interest and crazy regulatory policies, people are going to be like, wow, this is really nice. And all of a sudden you start to look at education, you start to look at health care, and you go, why is a TV $7 and an MRI is 4000? Like, what is happening? And this, I think, leads to this incredible moment where we start to realize that actually our lives are far less expensive than we realize. Our relationship with money is right now so corrupted by the fact that the three things that are so integral to survival have felt expensive for way longer than they needed to feel expensive for, and that buying a plane ticket should feel like a trip to primary care. Right. These are things that we should just get to do. Yeah, I consider it, but I'm not going to go bankrupt because of it. Now, on that note, if we can figure out a world where we can allow for healthcare, housing, and education to deflate in cost and massively expand access, then, and I think we will, for what it's worth, there was going to be incredible pressure to do so in all sorts of different ways. Then I think we will arrive at a place where people actually do start to ask, how much money do I need? Because today it's one of these. It's so charged. And if I even bring it up, people are like, that's so callous of you. Do you realize how many people are paycheck to paycheck? And I get it, then I have to remind people that even paycheck to paycheck in the United States is better than very good salary 100 years ago. We just forget these things. I actually do wonder all the time, quite frankly, what does a dollar mean to you in a world where things get so much less expensive and how badly do people clamor for them? I think that lots of people are going to want to compete on a luxury basis, and we're going to constantly invent new bespoke goods, and there's just going to be all sorts of status associated with some things. But at the same time, I'm like, yeah, in a world where we know that we are happiest when we are in physical community with friends and family, we are going to discover quickly that people are far more willing to explore the limit to what they need, because what they need sort of allows them a much more comfortable life.
- [71:33]
A
There are a few elements at play here that I kind of want to unpack. So one is the current reality that three elements of spending that are integral to our security and comfort. Housing, healthcare and education are incredibly expensive and have over the past many decades been rising at a rate that is.
- [71:52]
B
Much greater than inflation at a faster cost than makes sense.
- [71:55]
A
Exactly. All right, so on one hand you've got that going on and that.
- [71:58]
B
And they are catastrophically expensive in some cases. So it's not just that they're a little expensive, it's that when something breaks in healthcare, it can break catastrophically. If you can't get housing, you are homeless, et cetera, et cetera.
- [72:08]
A
Right, exactly. On one side you've got that going on. And those three elements are very fundamental to our security, to our security, and to the security of our, of our children. Any parent wants to know that their kid, at least in the domains of housing, healthcare, education, is going to be okay. So you've got that going on on one side and then you've got, and this is I think, the avocado toast criticism that particularly young people, I think unfairly get. You have luxury goods that are getting cheaper and cheaper and more accessible and more accessible because you have. This goes back to what you were saying about everything is a club. You have these different tiers where luxury experiences are more attainable. And so what you see, especially with Gen Z luxury. Right, exactly.
- [72:50]
B
Loosely defined.
- [72:51]
A
So what you see with Gen Z, for example, is that Gen Z might at the age of 30, still live with their parents due to economic necessity or perceived economic necessity, but they will spend a lot of money on getting a credit card with airline lounge access. Right. Even though there's a, maybe a $450 annual fee associated with that card because that airline lounge access creates a feeling of exclusivity. And in a world in which that Gen Z person feels as though they are shut out of home ownership, they at least get the trip to Cabo with the airline lounge access as sort of a consolation prize.
- [73:31]
B
Yeah.
- [73:32]
A
And so you have an economic situation right now in which people feel as though the basics are unattainable, but luxury, or at least this certainty.
- [73:41]
B
Our parents definition of luxury.
- [73:43]
A
Yeah, exactly. Our parents definition is something that my parents have never, my parents have never experienced. Airline lounge access, something that our parents would have defined as luxurious, is attainable to us even when the Basics are not. And that's a very confusing economic position to be in. That's the fundamental avocado toast criticism.
- [73:59]
B
Yeah. And it's the annoying one that boomers take up. They're like, oh, you're doing all this discretionary spending. And it's like, well, one, that discretionary spending is far less expensive than it would have been for you.
- [74:08]
A
Right, right.
- [74:08]
B
I mean, our great grandparents spent 40% of their wages on foodstuffs. We spend, on average, 10% this generation. So pointing at this as the issue is wrong. And also, the cost of housing, healthcare, and education is inflated so fast that for many people, it's like, well, give me this thing.
- [74:24]
A
Yeah, exactly.
- [74:25]
B
I totally get. Yeah, I totally get. And my question is, give me a.
- [74:28]
A
Visit to the doctor. I'll trade my airline lounge access for that. Yeah.
- [74:31]
B
The dirty little secret about primary care is that it's far less expensive than people realize. It's just that specialty care is so expensive. And so we. We've created a world where solving the problem is expensive, but actually preventing it is far less expensive than we. Anyway, we come back to that. You can imagine a world where we actually unlock the ability for technology to dramatically reduce the cost of housing, healthcare, and education. I really do imagine a world where the relationship with money changes fundamentally, where people are like, look, I don't have to earn endlessly because I'm not living in a hole that I have to dig myself out of. And where people start to build relationships with work and relationships with money that feel actually far more symbiotic than they do today, which is just like this. If you're too old, then you're attached to the idea that your home has to inflate. And if you're too young, you're attached to the idea you'll never be able to buy a home, and so you should just earn money and spend it on clubs and lounges. We don't want to live in either of those worlds. And the opportunity now is to shine a spotlight on this and also to really allow these technologies, AI, robotics, all these things, to do what they do best, which is automate a lot of really, really cumbersome, complex tasks to the economic advantage of the consumers.
- [75:41]
A
What I hear you talking about is essentially a version of early retirement for everyone, in which we have the luxury to ask the more existential questions of who am I and what makes me happy? You know, how can I be in community with my loved ones, with friends, neighbors, family, in a world in which I am not obligated if Costs have deflated in my life, particularly if housing, healthcare and education have deflated in a world in which I am not obligated to make as much money in order to live and have a good life.
- [76:08]
B
Or just specifically to say I'm in a world in which I'm not obligated to work endlessly.
- [76:12]
A
Exactly how does that square with the reality that humans are status seeking creatures and hierarchical creatures who, for as long as humans have been alive, we have a documented history of wanting to obtain status and have typically done so economically through economic competition.
- [76:33]
B
This one for me is actually pretty easy to answer, which is, we've run hundreds now of happiness studies. The famous one is the Harvard Happiness Study, which followed people for 80 years. I mean, this really, I mean truly one of the great studies on the human experience. But there are many others in the blue zones. I'm sure you're familiar with the blue zone studies to measure people who live a long time and longevity. And there are deathbed studies and just all these things consistently. The most important feature of a life well lived is community. Time with friends and family in community, ideally outside. This is one of these remarkable threads that connects all of these studies in longevity in happiness across socioeconomic boundaries. And what's amazing about these studies is we can all observe them anecdotally. Talk to your grandparents, if they're still alive, talk to your older aunts and uncles and ask them what makes their life well lived, what makes their life worth living. It's a really. One, it's a really wonderful exercise. Two, you arrive at the same thing. They don't talk about status. They do not talk about status. Now, it could have been in the moment, the status brought them some joy. But in the end, they look back on their lives with so much appreciation, so much gratitude for their community, for their friends and family, and for the spaces in which they enjoyed their company. I don't think it's actually a debate. I don't think we have to debate this one. I think that we've done enough research, we've seen this experiment play out enough individually and collectively to know that we are, again, depending on how religious or spiritual you are at any moment in time on this earth, to commune with the people we love and that we found work in order to commune more healthy lifestyles like we, we invented most jobs, the history of work to do things for the tribe that allowed the tribe to live collectively healthier lives and that perpetuated a long time. Until one day we turned around and we were like, why do we work, we sort of forgot the whole purpose. And in doing so, we actually also forgot the purpose of technology. We've created this abundance of technology, hardware and software, and a lot of it no longer serves our happiness. Of course, I'm talking about device addiction in this case, and things like social media, which are preying on people's desire for status and attention. But if you were to fast forward the lives of every influencer on Earth, you had the power to sort of put them in their deathbed and you ask them what was the best part of your life? How many of them would talk about the number of followers they had? We delude ourselves into thinking this is the thing, but we know it's not. We know it's not, and we've forgotten it for so long. And my point in all this is maybe we are on the precipice of a technology that will actually allow us to automate so much of the work that we have done for so long, which we started doing in the first place, to build healthier tribes so that we could commune better. Maybe in the process of doing so, we will actually force ourselves to very seriously ask a question that we have not asked for a very long time, probably, which is, what is the point of being human? What is the meaning of being alive, individually and collectively? And I point to what I think may in fact be more than just a economic awakening and renaissance, but a spiritual one. And of course, not everyone will enjoy the experience. I'm not proposing that it's Kumbaya for many people, it will feel very jarring. And of course, we don't share all the same values on Earth. This is one of the issues that we face, certainly across borders, but it does present this amazing moment where we actually, at least I think, over the next 50 years, are sort of moving in a direction to seriously ask ourselves, what do we want to do today? Like, what do you want to do today? If you get to answer that question in any direction, untethered from the necessity of money so that you can live a life, untethered from the necessity of a job so that you can make that money.
- [80:27]
A
Again, I hear the early retirement question there. Untethered from the necessity of a job so you can make money, what is the most meaningful way to spend your time? I see how that applies specifically to people who have pursued early retirement and who have spent a lot of their time reflecting on that question and who have built their lives towards it. But if we reach a point in which a broader swaths of aggregate society through Innovation and through automation are able to reach that same state, Would it not be the case that at least some proportion of them would say, you know, without the benefit of deathbed hindsight, I want to differentiate myself such that I have status in this society? Going back to the airline lounge, what is the benefit of an airline lounge? I mean, besides, like, some free cubes.
- [81:18]
B
Of cheese to walk through the doors amidst a bunch of people who cannot.
- [81:21]
A
Exactly.
- [81:22]
B
I'm sure we will come up with new ways of differentiating ourselves. Some of them may be physical or emotional. The competition has a lot of different angles. And arts, culture, science, lots of ways to explore this. I mean, every day it feels like we're inventing a new, very popular sport. If you haven't heard, the World Rodeo League, that's going to be very big soon. I played volleyball in high school and college. My wife was a very elite volleyball player. I mean, women's volleyball isn't the next big women's sport. I think it's the next big sport. And my argument is like, we're constantly discovering new ways to compete that are not economic in nature, necessarily because we're good at competing. And there are plenty of ways to not compete necessarily on economic status.
- [82:04]
A
Pickleball.
- [82:05]
B
Pick a sport. I mean, truly, like Padel, if you haven't been paying attention, is the new tennis esports. I mean, we're great at finding new ways to compete. I'm not proposing that we live in some la la land where we all wander aimlessly like zombies, happy that we have our ham and cheese sandwich. That's not panacea for me. Panacea is a world where you have access to health care, housing, and education such that you don't worry about your survival. And then we ask the question, what do I want to do today? And for many people, that will mean work a lot. And there will be plenty of things that you can do. We find, you know, Parkinson's. We figure out a way to.
- [82:42]
A
What's the Parkinson's Law?
- [82:43]
B
Yeah, we figure out a way to fill the time, Right? And for many people, it will be to recreate. And by the way, my theory of idiocracy says for many people it will be to do nothing. I think one of the great costs of optionality and freedom is the freedom to waste it. And we have to accept this as a society. So many people point to the idiocracy of people that a lot of people have stopped critically thinking as one of these great plagues. And I'm like, well, sort of. But in A world where we actually have so much abundance. Someone's ability to do nothing is a mark of a lot of success. I'm not saying I like the that outcome and I pray that people find personal agency and motivation to explore their limits, their personal limits. But it is something we have to reconcile that we have created a world with so much that if you want to stop critically thinking, you can. And I'm saying that for many people, once we find a world where we can provide, where technology has allowed us to provide housing, health care and education more affordably, which it will, I mean, it will. I mean the primary care doctor is going to move to our mobile device over the next 10 years in such a remarkable way. I don't think people are fully yet appreciative. And you know, Mackenzie Price and Alpha School is promoting this theory of two hour learning that is going to put an AI powered tutor in the hands of every child on earth. And that is super exciting. Like this is happening. And it's going to happen, by the way, against the best wishes of the institutions because the institutions are trying to keep the status quo. And also when we achieve this, plenty of people are going to say, I want to keep grinding, that's fine, I'm okay with that, that is great. And plenty of people are going to say I want to recreate. And plenty of people are going to say I want to do nothing. My point is it's even hard to explore these eventualities because so many people today say I can't even imagine that. I can't imagine that. And I think to your point, there are two reasons they say they can't imagine this. Three. The first is identity displacement. What I talked about earlier, it's very hard for anyone to imagine their life or purpose without their work. That is something that people don't like doing. The second is the Internet productivity phenomenon. The Internet promised it would make us more productive, which it did. And people somehow still work basically just as much as they used to. And I acknowledge that, though I remind people we do work less than our parents and grandparents. The average work week is actually shortening. And some of this is policy, but some of this is productivity. But the third, the reason I really think is that we have trapped ourselves in our devices. We have actually forgotten the vision of what life could be because we have become so addicted to the technologies that were designed to free us in the first place. And I do this, I prove this point by the way by asking people to see their screen time, which I have discovered is the most Intimate question one man can ask another, like a guy. The demographic, if you'll just imagine with me, is usually a white male in it. They'll say, I don't know why you think AI is going to automate this stuff. And it'll give me more time, look at my day. And I say, that's fine. Could I just see your screen time? Could I see how much time you actually spend in front of your device? And of course I can't ask them to see their TV screen time, but if I could and I could aggregate these things, what I've discovered is that we have just actually so badly conflated our device time with productivity and we waste so much time in our actual day that most people. And by the way, it's such a problem because people are so ashamed of it that we're not even willing to point at it and talk about it. We can't even as a society have honest conversations about these things because people are so embarrassed and ashamed of their own affliction. It's taboo. Right? It's commensurate with porn and gambling. I am on a crusade to convince people that we actually have far more time in the day than we realize and that we should start by recapturing our attention from the companies that are preying on it and then actually start to really explore, okay, now that I found time in a day that I had previous, what would I do with this time? Because I do think, and I'm not on this campaign, that personal responsibility is the only way that you can pick yourself up. But man, there are a lot of people in this world that have rediscovered the value of their own time and are living pretty wonderful lives as a result. That's not to say we shouldn't do all these other things, but it is to say that I think we have truly forgotten how much of our day we waste at the altar of the display of the device.
- [87:16]
A
Laura vanderkam has some excellent time use studies. She has created a great synopsis of American time use studies in which people track their time in 15 minute increments and has documented very, very well how in the span of 168 hour week, we have even people with busy careers, multiple young children. She has four children of her own with athletic hobbies, still have actually far more time than they perceive themselves to have. Partially it's because they're thinking about work even when they're not at work. So there's the cognitive notification. Yeah, yeah, there's that cognitive residue in which you overestimate the amount of time that you work because you're thinking about it, even when you're showering, and partially, as to your point, it's time wasted on the device is not necessarily when you're absentmindedly scrolling through Instagram, you don't necessarily recognize that you are taking a break.
- [88:11]
B
And Instagram is like the obvious one. And it's easy to point at Meta and say, what hath God wrought? And this is the new Philip Morris. And it is. But also the number of garbage TV shows that people watch. And by the way, I'm not here to crusade on people not watching tv. It's not my point, but there's a lot of time in the day to do things that don't include something. And I've watched Love Island. I think it's quite good. And I do get the appeal. And some of these things, by the way, some of these things are very important culturally. Like, you know, if you didn't watch.
- [88:43]
A
I love the Gilded Age.
- [88:44]
B
Yeah, yeah. And then if you weren't watching Game of Thrones, like, were you even, you know, how could you fit in? And I get that. But I remind people that it's more pernicious than just Instagram. Like, you can point at Instagram and say, well, this is bad, but it's. There's a lot of other things going on here. Your favorite TV show then rolls into your second or third favorite TV show. And while it's on, you might as well watch it. This is where I think we really are losing time. And as a result, just back to my point, what ends up happening is I feel like I'm speaking to people in a world where the marquee, the big issue is, hey, it's hard for me to have this conversation with you because either I or someone I know is struggling to make ends work in a world where housing, healthcare, and education are just prohibitively expensive for many people, or certainly probably education and healthcare, just like good education and healthcare is just so, so expensive. Housing, you can rent, I mean, you can't buy. But renting has become somewhat affordable. But the real issue, I think, is that backdrop paired with these three identity, displacement, screen addiction, and this loss of the actual. The misunderstanding of our actual time spent. And piecing apart all of that is not particularly easy, which makes this conversation quite hard. And it makes it easier for people to be like, oh, that guy's an idiot. If you start to explore a lot of these things. To me, it's kind of glaringly obvious if we built a better, more deliberate relationship with their device. And we put pressure on the ruling party to let technology affordably offer these services. We are not that far from a pretty amazing world. Like we really are like teasing this pretty cool space where lots of people get to do lots of really like explore lots of really cool passion projects. And the question what do you want to do today? Becomes like one that you can seriously answer.
- [90:34]
A
And so on that note, what do you want to do today?
- [90:38]
B
I want to go home, enjoy a nice meal with my wife and talk about this and talk about maybe nothing at all and just enjoy these last few moments. She's very pregnant, so these last few moments of just us.
- [90:52]
A
Nice. And you have a 15 year old cat.
- [90:54]
B
And our 15 year old cat Finney, who had a fun adventure today wandering.
- [90:58]
A
The apartment building and ended up on.
- [91:00]
B
The floor of ended up on the Raymond James floor looking for financial advice. See, even our cat wants access. Everything's gated these days.
- [91:09]
A
Excellent. Well, thank you for spending this time with us.
- [91:11]
B
Thanks so much Paul. I really appreciate you having me.
- [91:13]
A
Where can people find you if they'd like to learn more?
- [91:15]
B
The website zackcast.com z a c k k-a dash.com has information on the book the Next Renaissance AI and the expansion of human potential. Information on our newsletter, the Next Renaissance newsletter. I don't use social media, but I have a LinkedIn you can follow me there. We maybe need to solve that, but for now that's where you can find me.
- [91:34]
A
Thank you. Zach, what are three key takeaways that we got from this conversation? Key takeaway number one, everyone wants everyone else's job to automate. You don't want your own job to automate, but you do want other people's jobs to automate because that will make things cheaper. We all want faster services and lower costs. That requires automation and yet we're terrified of automation when it comes for our own careers. And that creates a, a bit of a paradox, a bit of a tension.
- [92:04]
B
We all day, you and I. Everyone here asks ourselves and people around us explicitly sometimes, when is this good or service going to be better, faster or cheaper? Without recognizing that what we are asking is when is this good or service going to have a human extricated from the manufacturing of it? One of the questions that I finally figured out I needed to ask these guys was who do they think benefits economically when we automate the ports? Like, to what end are we automating the ports?
- [92:31]
A
Key takeaway number two, your job might be safe, but you may also face an identity crisis. An Emotional reckoning. Zach argues that the real threat from AI is not economic, it is emotional. Most of us have so much identity wrapped up in our work that we can't imagine who we would be without it.
- [92:54]
B
Can we extricate our purpose and identity from our work? Because if we can't, then we're not going to let any of our work be automated. This is just going to be one of these incredible things where we, like, actually fight to the death for a job that some of us don't even like. Because the idea that we won't do that thing and we aren't on that career path is just terrifying.
- [93:12]
A
Finally, key takeaway. Number three. Financial illiteracy is the silent killer of wealth. While we sit here worried about AI taking our jobs, Zach points out that we're already bleeding a lot of money through financial illiteracy. Banks collected $11 billion in overdraft fees last year alone. That's just one of many examples. So AI can actually improve financial literacy and in doing so, help us be better at managing our money, at growing our wealth.
- [93:48]
B
Most people have no idea how much they are contributing to the bottom line of banks who are preying on their illiteracy, predatory lending, credit cards, charging people 30%. And just every month, just taking a little bit, and then you turn around and after a few years, you paid a credit card company $50,000, some egregious amount of your net worth because you're not even aware.
- [94:14]
A
Those are three key takeaways from this conversation with Zach Kass. Thank you so much for being an afforder. If you enjoyed today's episode, please do three things. First, share this with your friends, family, neighbors, colleagues, siblings, cousins, nieces, nephews. Share it with anyone who's worried about or optimistic about the future. Share it with the perma bulls and the perma bears, because that is the single most important way that you spread these ideas, that you spread the message of financial literacy, of double I fire. So that is number one. Number two, open your favorite podcast playing app. Make sure that you hit the follow button. And while you're there, please leave us up to a five star review. Number three, it's January, so download our free guide. It's a long one. It's a free guide to the financial goals that you'll set for the year. It's@affordanything.com financial goals. This is our one tweak a week guide. So it's very tactical and it talks about these tweaks that you can make that are very, very, very small. I mean extremely small. We're talking about once a quarter saving 1% more than you currently do. We're talking about little tweaks like that. Because if you do that 52 weeks a year, then by the end of the year, I mean, if once a quarter you increase your savings rate by 1%, you're saving an extra 4%. By the end of the year, you just went from a 6% savings rate to a 10% savings rate or a 20% savings rate to a 24% savings rate. And you did it incrementally. And so that's what this free guide helps walk you through. There are these tiny, minor tactical little tweaks that you can make. One tweak per week, every week. This year you can download this for free. It's called One Tweak a Week affordanything.com financialgoals that's affordanything.com financialgoals. It's a great thing. Every January, I encourage people to begin the year with a one tweak a week challenge. Again, download it for free at affordanything.com financialgoals thank you so much for tuning in. This is the Afford Anything podcast. I'm Paula Pan and I'll meet you in the next episode.