[ExI] How new AI economics might change our systems

[spike at rainier66.com]

From: extropy-chat <extropy-chat-bounces at lists.extropy.org> On Behalf Of BillK via extropy-chat
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Summary Verdict


The commenter is fundamentally correct in arguing that rigid fiscal austerity and 20th-century labor-centric frameworks cannot survive the AI transition. Insisting on a balanced budget while the world undergoes an industrial and cognitive revolution is like refusing to buy a steam engine because you want to keep your horse-and-buggy budget intact.

However, the idea that "everything" must be thrown out is dangerous techno-determinism. You can discard balanced-budget dogma, but you cannot discard:

1. Physical resource limits (energy, materials).

2. Monetary realities (inflation, interest rates, currency credibility).

3. Political philosophy (power distribution, equity, and human dignity).

The goal isn't to operate without an ideological and economic framework—it is to build a new one capable of governing a world where intelligence is abundant, but the physical resources and human wisdom to direct it remain scarce.

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BillK, several AIs missed something really important in that list of things that cannot be discarded: debt.

 

A government can devalue its currency and diminish its debt, but it still owes the bond holders.  Devaluing its currency comes at a price: its borrowing cost goes way up.  If it gets carried away with devaluing its currency, a government may find itself unable to borrow.  Yanks fail to realize how little they would be able to get from the federal government unable to borrow money. 

 

The AIs appear to be fans of modern monetary theory, however it doesn’t do much with post-modern monetary theory, which posits that modern monetary theory is incorrect.  We had a good explanation of modern monetary theory by a former economic advisor:

 

https://www.youtube.com/watch?v=1Fj0zRmEWYc

 

OK that clears it up.

 

spike

 

 

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