AI’s biggest threat: Inequality on a global scale
The US once led the world to prosperity. Now it’s getting schooled in ethics by Chinese entrepreneurs and investors. Kai-Fu Lee, the chairman and CEO of Sinovation Ventures and the president of its Artificial Intelligence Institute, explores two incipient AI challenges—”enormous wealth concentrated in relatively few hands and enormous numbers of people out of work”—in an opinion piece in the New York Times, arguing that social welfare programs such as a universal basic income, paid for by higher taxes on those very same corporations displacing workers through automation, will be required to solve this crisis on a national level. However, the biggest looming threat is global, as the rest of the world deals with the economic effects of an AI industry dominated by the US and China.
Lee’s comments echo those made by Alibaba Group chairman Jack Ma at the World Economic Forum in Davos back in January. Ma admonished the US for wasting the immense wealth it has earned as a beneficiary of globalization. Ma explains that globalization is not the cause of the US’s economic misfortunes; instead, the blame falls squarely on a failed economic strategy that in the past 30 years has spent $14.2 trillion fighting wars while the national economy shifted from manufacturing to financialization. “What if,” Ma asks, “[the US] had spent part of that money on building up their infrastructure, helping white-collar and blue-collar workers? You’re supposed to spend money on your own people.” In his talk, which you can watch in full here, Ma shares his ideas for an improved “inclusive globalization” founded on widespread international partnerships, rather than the demands of a single guiding country, that would expand globalization’s benefits beyond a select few multinational corporations to cover an exponentially larger number of smaller businesses.
But America hasn’t just wasted its wealth. The super-rich increasingly hoard it through baroque methods of tax avoidance, removing billions in revenue that could be spent on infrastructure and social programs. In her new book, Capital Without Borders: Wealth Management and the One Percent, sociologist Brooke Harrington makes the case that wealth managers are the driving force behind global inequality. “If wealth managers disappeared from the face of the earth, there would still be tax evasion. But it couldn’t happen on the grand scale that we are seeing today without expert intervention.”