Brace for Technological Unemployment!

Few months back I called the helpline of an electricity provider in the US for a billing query. A beautiful voice answered the phone, the call was professionally handled and I received satisfactory responses to all my questions. Nothing unique about this experience but what was interesting was the call was answered using IVR (Interactive Voice Response). It was a thought provoking experience.

If one looks around there is so much investment going into reducing the human element, of course not with any malicious intent but to reduce cost, improve quality, increase productivity and increase output. Here are few of the recent developments, most of them using Artificial Intelligence (AI):

• Driverless Car - Tesla, Google, Apple and many more are investing heavily and experimenting with their respective proto-types. It is expected that by 2040, 75% of the cars will be driverless in the US.
•  Blockchain Technology
• Algorithm Trading – Most of the banks have already put this to use and Algo trading is faster, more accurate and profitable
• Cashier Free convenience stores – Re: “Amazon Go”
• Intelligent Assistant - Apple’s Siri, Google’s Google Now etc. are the solution to replace personal assistants
• Robots on the shop floor, un-manned traffic control and the list goes on 

Connecting the dots, the future jobs will be those jobs which can’t be performed by artificial intelligence. Anything repetitive or needing low or no cognitive capabilities will cease to exist. May sound apparent but the future jobs will be jobs requiring “common sense” those related to:

•        Problem solving – Consulting and Project/Change management
•        Resolving Human Issues – HR and Relationship management
•        Science – Researchers, Developers, Testers, Doctors etc. Robots don’t know that strings can pull but the strings can’t push.
•        Sportsmen, Craftsmen and Entertainers – Droids can’t be creative

Automation will surely affect the job market and this change will be too much and too soon. Hence it is important for us to brace ourselves for this change.

To end my blog on a positive note hopefully the future won’t be gloomy. Historical records show that in the 1800s, many Americans worked seventy hours or more per week. It is important to draw a lesson here. Technology increases worker productivity and the total wealth produced by the enterprise. In such a scenario, one option is to let some workers work long hours, tax them, and use taxes to pay for the unemployed. A better option is to let many more workers work shorter hours per week and earn decent wages; with lower taxes and lower or no unemployment. The additional leisure or personal time that people gain can be used for intellectual and other ethical pursuits. The latter scenario is possible and leaders across the globe will develop scenarios and strategies to get there.

Few of us will find it difficult to accept this and I think there must have been a lot of resistance to adopt a wheel when it was created. Its human nature to fear the unknown but to adapt to change is more human.

What’s wrong with America?

I visited the US for the first time 8 years back and living here since some time now. I was awestruck from the first glimpse of this nation and soon realized why this called the land of dreams (the American Dream as you may have heard). After spending some time reading, meeting people and a experiencing US during the visits across multiple cities I got a feeling somehow the "American Dream" is fading. Penning down some of my observations.

1.       Income Inequality - Income disparities have become so pronounced that America’s top 0.1% now average nearly two hundred times as much income as the bottom 99.9% percent. This gap between the super-rich and poor is increasing at a pace never experienced before. A progressive tax system should function to narrow income gaps between the affluent and the rest but per the statistics apparently American tax system hasn’t done any narrowing.

2.       Corporations Funding political parties which is defeating democracy - In other words large corporates funding US elections is making America less democratic. What the public wants does not typically impact what the U.S. government does. The policies or regulations are potentially built by the government and the regulators to favour the corporates who fund the elections. Citizens become convinced that the government is only serving and representing the interests of the rich. Political candidates and parties are relying more on deep pocketed campaign donors than at any other time before. As the rich become richer and secure more political influence, they support policies that make them wealthier at the expense of everyone else.

3.       Political lobbying - It is now routine for the interests being regulated to control the regulators, which makes things much easier on the regulated.

4.       Raising Debt – US is on the verge of breaking the $20 Trillion debt mark. To feed the expanding debt, the whole economy has to grow i.e. manufacturing, sales and consumption all must increase. Businesses have to expand to stay afloat. But since the money scarcity and debt pressure keeps increasing, economic growth becomes more and more of a squeeze play. The trend is to cut the work force, cut wages, cut benefits, cut the quality of the product or service, and of course, outsource the labour to foreign countries with low wages and poor labour protection—anything that can be done to get more out of less.

5.       Corporate tax structure – Large corporations can legally avoid taxes due to the sheer tax structure. Please note I’m not talking about avoiding taxes by setting up offices in tax havens here. Simple math: Individuals pay their taxes first and then consume/spend the rest whereas corporations consume/spend first and then pay taxes. This flaw is basic taxation is also leading to disparity of income in the US and across the globe.

6.       Consumption based economy - The US is a consumption-based economy and it is a consumption-driven society. Consumption is an economic function that is defined as the value of all goods and services bought by people. In the recent past progress of a nation is determined by the performance of a country in terms of consumption level. The underlying theory of a consumption-based economy is that progressively greater consumption of goods is economically beneficial. But this theory is only partly true. Being self-reliant in true sense will ensure sustainable economic conditions in the long run. Neither extreme is sustainable for any economy re: China a production based economy and US a consumption based economy.

7.       Inappropriate Marketing – Advertising should be informative for the customers and not a “Dog & Pony Show” highlighting the rosy picture to sell a product. Obsessive consumers are not born, they're formed by advertising. E.g. If you’re selling a car showcase the features of your product or do a comparative analysis with other cars in the segment why do you want a sports star or a film star to sell your product. Informative advertisements would result in rational decisions these ads provide no information and promote irrational choices.

8.       Luxuries considered as necessities – The viewpoints of people from different backgrounds and upbringing will differ a lot here e.g. clothes dryer, dish washer, home computer, microwave etc. are considered to be necessities in the developed worlds.  More and more products & services are considered to be a necessity e.g. a summer and a winter vacation is preferred over taking a break and planning a get together with family and friends. Upgrading you smart phone, laptop, car etc. after paying of the EMI on it if becoming #thetrend of the day.

9.       Cost of living - With a rise in nuclear families or single parent and both parents working household’s expenditure on labour saving items is increasing. In addition nuclear families lead to increase the process of rent & real estate (housing is generally a significant portion of one’s household expenditure). Over reliance on private transportation not on public transportation which increases the demand of not only oil but various other goods and services related to purchasing, owning and maintaining ones vehicles. This also adds to ones cost of living.

10.   Expensive health care and education system – Good health care and education system are the key pillars for a sound and sustainable economic progress. Unfortunately in the US these requirements or rights are widely unintentionally denied due to them being very expensive (my first-hand experience is medical care is too complex to) for the vast majority of citizens.

Like every other nation there are positives and negatives here too but what is important is how the people and the leaders turn things around.

Best wishes everyone!

Looks like it will be Trump!

I’m not a “Political Pundit” but was keenly following the US Presidential elections 2016, primarily to know more about the US political system. Another reason was to hear Donald Trump’s views and to understand his techniques to negotiate and debate.

Donald Trump started as 1 of the 17 biggies in the Republican Party, many of them with sound political backing and corporate funding unlike him. 

#1 - Trump starts to ensure he is noticed and gets attention. Hence he starts with making outlandish and polarizing statements against

• Immigrants
• ISIS and the families of the terrorist (Bombing ISIS and going after the families of the terrorist)
• Policies of countries like China and India
• Muslims
• Women (in certain cases)
• Mexicans  

#2 - Media Coverage with "Trump Statements”. In addition to #1 his suggestions to build a wall on the Mexican border and not allowing Mexican’s to send money back home, his polarizing statements about Muslims, women and multiple other issues ensured the media covers him well. The trick was successful and got free media coverage worth $2Bn (re: NY Times), this was the maximum amongst all the contenders.

#3 - Starts picking upon his opponents, often repeats his quotes during the debates and on & off the stage too. He started with taking on the strongest and then picking up the next best. Branding like Weak or low energy Jeb, lying Ted, little Marco, Crooked Hillary or heartless Hillary.

#4 - Shifting gears and started talking about too much weaponry and destruction around the world that’s opposite to the previous suggestions to not have gun free zone in schools and bombing the hell out of ISIS

#5 - He is not trying to be politically correct hence can afford be outrageous. Many voters may like this trait of his!

#6 - He is not trying to please everyone

#7 - He is fearless and understands he has nothing to loose. In an interview to CNBC he mentioned if he doesn't win the elections he is going to take a "very, very nice long vacation"

To sum-up Trumps style was simple

1.     Get Attention

2.     Be Flexible

3.     Win one at a time

4.     Remove threats one at a time

5.     Define the terms of the engagement i.e. highlighting or discussing things which were not even part of the mainframe discussion like the “Trump Wall”, anti-establishment etc. For e.g. having an "outsider" now in White House was one of the solutions he proposed. Basically Trump made being an insider a stigma and Clinton fell for it. Now this was so effective that even Hillary Clinton called herself an outsider instead of being the first lady for 8 years and then the secretary of the state now for 4 years. Hillary’s website also has Trump's name “Love Trump Haters” but for Donald every publicity is a good publicity

The recent developments will increase the chances of Donald Trump becoming the next US President

- Terror attacks in multiple places across US including the recent ones in NY, NJ and Minnesota
- Speculations about Hillary's health
- Clinton's email server issues and 
- Wikileaks publishing alleged emails from Clinton

Lately elections across the globe aren’t fought on policies and proposals but personalities and the same thing is happening in the US too (Trump vs Clinton).

Best wishes to everyone, please register yourself and exercise your voting rights!!