Egregoros

Subscriptions and memberships that passively renewed despite months of disuse. Introductory pricing that sneakily doubled after the trial period. Each one was rebranded as a hostage situation that agents could negotiate. The average customer lifetime value, the metric the entire subscription economy was built on, distinctly declined.

...

Any category where the service provider’s value proposition was ultimately “I will navigate complexity that you find tedious” was disrupted, as the agents found nothing tedious.

😆 Disenshitification by AI would be quite a reversal of the current trends.

[...Door-dash is disintermediated by AI...]

This was oddly poetic, as perhaps the only example in this entire saga of agents doing a favor for the soon-to-be-displaced white collar workers. When they ended up as delivery drivers, at least half their earnings weren’t going to Uber and DoorDash. Of course, this favor from technology didn’t last for long as autonomous vehicles proliferated.

😆

The federal government’s revenue base is essentially a tax on human time. People work, firms pay them, the government takes a cut. Individual income and payroll taxes are the spine of receipts in normal years.

Indeed. Collapse in the labour economy causes a financial state collapse when the state is funded by a tax on labour.

Productivity is surging, but the gains are flowing to capital and compute, not labor.

Which would ideally mean you tax compute and capital but how's that work when compute and capital own the government already?

The output is still there. But it’s no longer routing through households on the way back to firms, which means it’s no longer routing through the IRS either.

The Occupy Silicon Valley movement has been emblematic of wider dissatisfaction. Last month, demonstrators blockaded the entrances to Anthropic and OpenAI’s San Francisco offices for three weeks straight. Their numbers are growing, and the demonstrations have drawn more media coverage than the unemployment data that prompted them.

It’s hard to imagine the public hating anyone more than the bankers in the fallout of the GFC, but the AI labs are making a run at it.

Dunno that the public hated the bankers nearly as much as they ought to have. Outside Iceland were any jailed? Did any even lose their job?

For the entirety of modern economic history, human intelligence has been the scarce input. Capital was abundant (or at least, replicable). Natural resources were finite but substitutable. Technology improved slowly enough that humans could adapt. Intelligence, the ability to analyze, decide, create, persuade, and coordinate, was the thing that could not be replicated at scale.

Human intelligence derived its inherent premium from its scarcity. Every institution in our economy, from the labor market to the mortgage market to the tax code, was designed for a world in which that assumption held.

We are now experiencing the unwind of that premium. Machine intelligence is now a competent and rapidly improving substitute for human intelligence across a growing range of tasks

Which is what saves us from this scenario I guess? Because the machine likely isn't really a substitute for human intelligence.

🤞