Editing 1: Peter Thiel (section)

=== Automation ===

'''Eric Weinstein:''' So, this is why I try to sell you sometimes on a more progressive view of the world, which is I want deregulated capitalism. I want the people who have the rare skillsets to be able to integrate across many different areas, and to be honest, this is the thing that I wish more people understood about what you bring, which is that you're able to think in, I don't know, 15 different idioms that most people only have one or two of. So, whatever it is that you're doing to integrate these things as an investor and to direct research and direct work is really something that I've watched firsthand for six years. The problem that I have is, we are going to have to take care of the median individual. And I less think that the median individual is going to be reachable by the market over time, as some of these things that are working in Silicon in terms of machine learning-

'''Peter Thiel:''' Yeah, but then you're being more optimistic on progress in tech than is... Because look, I think, yes, if we have runaway automation, and if we're building robots that are smarter than humans and can do everything humans can do, then we probably have to have a serious conversation about a universal basic income or something like that, and you're going to end up with a very, very weird society. I don't see the automation happening at all, and I think the question of automation in my mind is identical to this question of productivity growth. We've been automating for 200, 250 years, since Industrial Revolution, agriculture and manufacturing, and the sort of society we have in the early 21st century is one in which most jobs are non-tradable service sector jobs that are not easily automatable.

'''Peter Thiel:''' So, it's like a waiter in a restaurant. It's a yoga instructor. It's a nurse. It's a kindergarten teacher. That's what most jobs in our society are, and because they've been so resistant to automation, that this may be one of the reasons why the productivity numbers are slowing down, even if we're still innovating as fast in manufacturing, and even if we're still agriculture, they're a smaller and smaller part of the economy. So, even 5% a year productivity growth in manufacturing, that means a lot more if manufacturing is 60% of the economy, than it does when it's, say, 20% of the economy. So, that's roughly what I think would happen, and if you just look at the current dynamic in the US as we have unemployment, like 3.6%, 3.7%. It's super low, and still, there doesn't seem to be that much wage pressure. There doesn't seem to be that much growth. The productivity numbers still aren't great. You'd think there'd be enormous incentives to increase productivity.

'''Eric Weinstein:''' It's quite confusing to me. Yeah.

'''Peter Thiel:''' But I think, again, my read on it is just the automation story has been oversold.

'''Eric Weinstein:''' I agree that the automation story has been oversold.

'''Peter Thiel:''' It's possible it's going to happen. It's possible it's just around the corner, and it's about to happen. That's what we've been told in a lot of these areas over the last 40, 50 years.

'''Eric Weinstein:''' So, I have a couple questions about this. One is sort of, if I think about how common retail occupations are, is there something about retail that is resistant to Amazonification, if you will, where people actually want to go shop in a physical place and are willing to pay a premium that we have just to have human contact? Maybe there's some information exchange. Maybe there's a recreational aspect that's bundled. That's one of my two questions, and the other one surrounds the idea that we've always focused on when is AGI coming, and the robots that will do everything? Part of the lesson for me about machine learning is how many things humans were doing that don't require anything like artificial general intelligence. Just some specialized neural net seems to be good enough to do the job. So, those would be two questions in my mind as to how-

'''Peter Thiel:''' Yes, but I think all these things you have to concretize, and yes, I think retail is a sector that's under quite a bit of pressure, and is going to stay under quite a bit of pressure. That's the top one I would come up with is-

'''Eric Weinstein:''' Well, it's looks vulnerable to me.

'''Peter Thiel:''' Amazon is the most threatening of the big tech companies in that it's threatening a lot of other companies elsewhere in the industry and disrupting them and making things more efficient, but probably with a lot of sheer forces at work in that process. So, I agree that that's a candidate for automation or productivity improvements or things like that. I'm still not convinced that it's in the aggregate shifting things that much, and then you can go through all sorts of individual job descriptions where people used to have secretaries because typing was a skill, and with a word processor you don't quite need this. You can do short emails. You don't quite need a secretary. People still have executive assistants that sort of somehow do slightly different set of responsibilities, but it's not clear we have fewer executive assistants than we used to have secretaries.

'''Peter Thiel:''' So, when one actually concretizes it, it's not quite clear how disruptive the automation that's happening really is. Again, it's a version of the tech stagnation thing. It's always the last 40, 50 years, things have been slow. We're always told it's about to accelerate like crazy. That may be true. In some ways, I hope that's true, but if one was simply extrapolating from the last 40 to 50 years, perhaps the default is that we should be more worried about the lack of automation than excess automation.

'''Eric Weinstein:''' Oh, that's really interesting.

'''Peter Thiel:''' Yeah. Again, I think if we had this sort of runaway automation, you could get to 3%, 4% GDP growth, and at 3% to 4% GDP growth, we can solve these problems socially.

'''Eric Weinstein:''' You would be willing to have... This thing that I've been talking to Andrew Yang about has been the idea of hyper-capitalism, which is a deregulated hyper-capitalism where you can do more experimenting, more playing, coupled to some kind of hyper-socialism where you recognize that the median individual might not be able in the future to easily defend a position needed for family formation.

'''Peter Thiel:''' Well, let me rephrase this a little bit. You're not going to get a conversion experience on your first podcast here, Eric.

'''Eric Weinstein:''' You're going to make me wait for the next?

'''Peter Thiel:''' Maybe, or maybe even a little longer than that too. But I would say if we can get the GDP growth back to 3% a year on a sustainable basis-

'''Eric Weinstein:''' Without fudging.

'''Peter Thiel:''' ... without fudging, without lying about productivity numbers, et cetera, then there will be a lot more room for various social programs. I wouldn't want them to be misdirected in all sorts of ways, but there would be a lot of things that we could do. And I would be very uncomfortable starting with the social programs without the growth. That's the sort of conversation that I often see happening in Silicon Valley, where we start with UBI, because we're lying about automation. If automation's happening, then we'll see in the productivity numbers, and then eventually, maybe we need something like UBI. If automation is not happening and you do UBI, then you just blow up the economy.

'''Eric Weinstein:''' Right. I should say, and you've come somewhat towards-

'''Peter Thiel:''' Doing them in parallel, I'm okay with that. I'm not not okay with starting with the socialism. Even a Marxist wouldn't believe this. Even a Marxist thinks you have to first get the capitalists to do things before you can redistribute stuff.

'''Eric Weinstein:''' Right. I know.

'''Peter Thiel:''' You can't start with the redistribution before we've done the automation.