Is technology upending our world - automating jobs, deepening inequality and creating tools of surveillance and misinformation that will ultimately threaten democracy? Does technology need to be steered to promote public good? The authors ask. Just as the innovations of the Age of Industrialization had to be reined in by progressive politics, so too, in our Coded Age, we need  not only the civil society, the trade unions, but also legislative and regulatory reforms to deter the rise of a new panopticon of AI-enabled snooping. This book may not endear itself to Microsoft executives, but is a bracing wake up call to rest of the world.

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A thousand years of history and contemporary evidence makes one thing clear. Progress is not automatic, but relies on the choices we make about technology, say the authors. New ways of organizing production and communication can either serve the narrow elite interests or become the foundation for widespread prosperity. Much of the wealth generated by agricultural advances during the Middle Ages Europe was captured by the Church and used to build grand Cathedrals while peasants starved. And throughout the world today, digital technologies and artificial intelligence increase inequality and undermine democracy through excessive automation, massive data collection, and intrusive surveillance. However, it doesn’t have to be this way. The tremendous computing advances of the last half century can become empowering and democratizing tools, but not if all major decisions remain in the hands of a few hubristic tech leaders. A scan of history and contemporary evidence makes one aspect very clear: there is nothing automatic about new tech bringing in widespread prosperity. Whether they do or not is an economic, social and political choice. This book explores the nature of this choice, the historic and contemporary evidence on the relationship among technology, wages, inequality, and what we can do so that innovations that are piling on in 20th and 21st centuries can work in service of shared prosperity. The key word here is “shared”.

 

Towards this end, it asks

1. What determines when new machines and production techniques increase wages?

2. What would it take to redirect technology towards building a better future?

3. Why is the current thinking among tech entrepreneurs and visionaries pushing in a different and more worrying direction, especially with the new found enthusiasm around artificial intelligence?

 

Optimism regarding shared benefits from technological progress is based on a simple (and powerful) idea: “the productivity bandwagon”.However, economists have long recognized that demand for all tasks, and for different type of workers, does not necessarily grow at the same time.Nevertheless, nobody is supposed to be left behind completely by technology. A well known expert on technology put it “What can we do to create shared prosperity? The answer is not to slow down technology. Instead of racing against the machine, we need to race with the machine. That is the grand challenge.” The authors feel that this happens, but only sometimes, and most often in omission.

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Human history is filled with instances of new inventions and scientific progress that did not bring shared prosperity. A whole series of technological improvements in middle ages and early modern agriculture did not benefit peasants who constituted 90 percent of the population. Advances in European ship design from Middle ages enabled transoceanic trade and meant massive profits for some; the same type of ships transported millions of enslaved people from Africa and Asia to the New World, creating systems of oppression whose awful legacies mark global societies even today. Textile factories of the Industrial Revolution era generated great wealth for some but created horrible work conditions for most ordinary workers worldwide. The cotton gin was a revolutionary invention; it turned the US into largest cotton exporter of the world, at the same time this intensified the savagery of slavery as cotton plantations expanded in the American South, leading to a major Civil War in 1860s, and political upheaval that marked the US. If we project this into the present, the lasting legacy of apartheid in America will impact even the US elections this year, even in a vastly changed world. At the end of 19th century, German scientists developed artificial fertilizers to boost agricultural yields. The same chemicals were tweaked later to design chemical weapons that killed and injured hundreds of thousands during the First World War. ​

 

And finally, from the second half of 20th century till the present, spectacular advances in computers and their increasing applications in almost every sphere of human activity have enriched a small group of entrepreneurs and business tycoons over last several decades, leaving behind the less educated with decreased or little incomes. The impact of this varies from country to country in a globalized world, between Asia and the West in general, between the North and the South, but disparities overall have increased across global and political boundaries. Existing difficulties have been now further inflamed by long standing conflict in East Europe and now in the West Asian region.

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Commentators and readers may object to all this: Did we not, they ask, hugely benefit from industrialization? Are we not more prosperous/healthy, have better living standards today than 300 years back? Of course scientific and tech. progress is the bedrock of that story; it will also have to be a part of any future processes of shared gains. However this broad based prosperity of the past was not consequence of automatic, guaranteed gains of tech. progress. Rather, shared prosperity emerged only when society`s approach to dividing the gains were pushed away from arrangements that mainly served a narrow elite. The authors, thus, think that we are beneficiaries of this progress only because our predecessors made this progress work for more people i.e. made benefits more broadbased. When workers gathered in factories and cities it became easier for them to rally round common interests and demand more equitable participation in the economic gains.

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Why are some countries rich and others poor has been debated by economists ever since Adam Smith wrote “The Wealth of Nations” Today, it is postulated that the richest 20% of counties in the world possess 30 times the wealth in terms of average income than the poorest 20%.The Industrial Revolution led to “The Great Divergence” in living standards between East and the West. While various theories—Western colonialism, disparities in natural resource endowment and so on - have been proposed to explain the huge disparities. However, Acemoglu and Johnson (a third scholar) have argued in an earlier book ‘Why Nations Fail: The Origins of Power, Prosperity and Poverty”(2012) that differences in the quality of economic and political institutions is what best explains the divergence in the economic fates of countries. Inclusive institutions, they argue, are characterized by secure private property rights and democracy, while extractive institutions are marked by insecure private property rights and lack of political freedom. The scholars have elaborated on why inclusive institutions, which are extremely crucial for long term economic growth, have not been adopted by more countries in the world.

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Electoral competition, rise of trade unions, legislation to guard workers` rights and wages were set in industrially advanced Europe. Combined with new waves of innovation in the US created a new direction of tech. that focused on increasing worker productivity rather than just substituting human effort by machinery. The world as a whole is better off today because citizens and workers in early industrial societies challenged elite - dominated choices about Tech and working conditions, and enforced through ways of sharing gains from the fall out of progress.

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 The authors think that we need to do the same again.

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They point out the incredible range of tools available to us - industrial robots, magnetic resonance imaging (MRI),  m RNA vaccines, internet, tremendous computational power, and massive amounts of data on things we simply could not measure before. We can use these innovations to solve real problems—scientific discoveries today travel almost like lightning speed, especially when there is pressing need. Not far back, vaccine development was imperative to allow the entire globe, literally to breathe safely!! In early 2020 Moderna Inc., created a vaccine just 42 days after receiving the recently identified genome sequence of SARS-Co V-2 virus. The entire development, testing and authorization process took less than a year, resulting in remarkably safe and effective protection against severe and often fatal illness caused by the COVID pandemic. The barriers to exchanging ideas of technical knowhow have never been lower and cumulative power of science never more robust. But to build on these advances and transform them to better the lives of millions on Earth, we need to redirect technology. This must start by confronting the almost blind techno-optimism of our ago, and develop new ways to develop scientific innovation. In short, it is how we imagine technologies and their gifts to Mankind, as well as the potential damage.

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The good news, and the bad, is that how we use knowledge and science depends on vision. It shapes our aspirations, what means we follow to achieve them, and what we will ignore. The bad news is that even at the best of times, visions of powerful people have a disproportionate effect on what we do with our existing innovation tools. The effects of technology are then aligned with such people`s interests and beiefs, and often prove costly to the rest.

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Again, the good news is that choices and visions can change.

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Although general purpose technologies are developed in different ways, once a shared vision locks in a specific direction, it becomes difficult to loosen its hold to see different trajectories which may be socially more beneficial. Most people affected by such decisions are not consulted, so the natural tendency is for direction of progress to be socially biased - in favour of powerful decision makers. For instance, the decision of the Chinese Communist Party to introduce a social credit system that collects data on individuals, businesses, government agencies to keep track of their trustworthiness and whether they abide by rules. Initiated at local level in 2009, it aims to blacklist people and companies because of their speech or social media posts that go against party preferences. This decision which affects lives of 1.4 billion people, was taken by a few party leaders. There was no consultation with those whose freedom of speech and association, education, ability to travel, government jobs and even likelihood of getting government services and housing are now shaped by the system.

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And this is not something that happens only in dictatorships. In 2018, Mark Zuckerberg, Facebook founder announced that the company`s algorithm would be modified to give users “meaningful social interactions” What it meant was that the platform`s algorithm would prioritize posts from other users, especially family and friends, rather than news organizations and brands. The change aimed to increase user engagement because it was found that people are more likely to drawn to and click on posts by their acquaintances. The main result of the change was to amplify misinformation and political polarization, as lies and misleading posts gained most circulation. The changes did not only affect the company`s 2.5 billion users, but billions not on the platform were indirectly affected by the political fallout from this misinformation. These changes happened at the behest of a few topmost executives, and Facebook users and citizens of affected democracies were not consulted.

 

In both cases, it is important to note how technology was used for control over political overview of the population in China`s case, and people's data and social activities for Facebook.

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The authors note that technology is about control, not just over Nature, but also over other humans. Fundamentally, different ways of organizing production enrich and empower some people and disempower others. Societies may become gripped by visions that favour powerful individuals, enabling them to add to their wealth, political influence or status - witness the twists and turns of Presidential elections in the US.

 

However, the authors feel there is reason to be hopeful because History also teaches us that a more inclusive vision listens to a broader set of voices. Shared prosperity is more likely when countervailing forces hold entrepreneurs and technology leaders accountable. They ensure that social decisions recognize their full consequences, and those who do not gain benefits are not silenced.

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Selfishness can be countered with a more inclusive vision, but it is becoming harder in the age of Artificial Intelligence. Control of fire over the last 10,000 years could claim to have a fundamental impact on everything else we do and who we are. Enter Sundar Pichai, CEO of Google who says “AI is probably the most important thing humanity has worked on. I think of it as something more profound than electricity or fire”.

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AI is that branch of computer science that develops “intelligent machines” that perform many tasks thought impossible a few decades ago - face recognition software, recommendation systems that match you to products you are most likely to enjoy (and finally buy!), forms of natural language processing to interface between human speech or written enquiries and computers, and so on.

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AI enthusiasts point to its impressive early achievements - identify serious illnesses, invest better than serious financial analysts, while others point to the help they give to lawyers and para legals in finding legal precedents for a case. It is reputed to compose music and write musical pieces and (dull) newspaper articles. It has thus become quite commonplace to assume that AI will affect every aspect of our lives - and for the better.

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But what if there is a fly in the ointment? What if A.I. fundamentally disrupts the labour market where most of us earn our livelihoods, expanding inequalities? What if its main impact will not be to enhance productivity, but redistribute power and prosperity away from ordinary people towards those controlling data and making key corporate decisions? What if, enroute, it impoverishes billions in the developing world? What if it reinforces existing biases - for instance, based on skin colour?

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Most crucial, what if it destroys or seriously impairs democratic institutions?

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Evidence is mounting that these are valid concerns. AI appears set on a trajectory that will multiply inequalities globally. Fueled by massive data collection by tech companies and authoritarian governments, it is stifling democracy and strengthening autocracy. It is profoundly impacting economies and doing little to improve our productive capacities. When all is said and done, the newfound enthusiasm about A.I. seems an intensification of the same optimism about tech regardless of its focus on automation, surveillance and disempowerment of ordinary people that had already engulfed the digital world. Yet these concerns are not taken seriously by most tech leaders.If A.I. creates disruptions, these problems, they say are short term, inevitable and easily rectified. If it is creating more losers, the solution is more AI.

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To be fair, not everyone is so sanguine about the benefits of AI. Many, as Gates and Musk, have expressed concern about the misaligned super intelligence and effects of uncontrolled AI development on future of humanity. We should not assume that the chosen path will benefit everyone, for the productivity bandwagon is often weak and never automatic. Not coincidentally, it amplifies the power and wealth of a narrow elite, at the expense of most ordinary people. This group has access to corridors of political power, and can influence public opinion via journalists, business leaders, politicians and all sorts of intellectuals. This “vision oligarchy” is always at the table and at the microphone when important arguments are made.

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The authors strongly feel that it is critical that this oligarchy is reined in. They feel that technological developments of the 20th and 21st century have placed amazing tools at our disposal, and digital technology can amplify what humanity can do. But only if we put these tools to work for people. And this, they say, is not going to happen unless we challenge the world view that prevails among the current global tech bosses. This view is based on a particular—and inaccurate-- reading of history, and how it points to innovation affecting humanity in the long run. Thus looking at the preceding millennia of tech history, authors Acemoglu and Johnson have explained how transformation of work could make life more difficult for many people, both in the developed and developing world, or possibly much better----depending on the politico-social and technological choices we make starting now. These are the BIG questions that affect all lives, wherever we are on the globe.

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This compelling, tightly written account has a profound historical context which lights a better path forward---a humane and hopeful book that shows how we can steer technology to public good and useful reading for anyone who cares about fate of democracy in a digital age, and wants to help shape a better future, encouraging innovation to support equality.