How well we handle change is critical — it could mean either social progress or misery. Our challenge is to take advantage of wonderful opportunities for growth offer while minimizing problems that come along with it, writes Jack  Mintz.

By Jack Mintz, January 2, 2020

Artificial intelligence and robotics. Energy transformation. China-U.S. rivalry. These are just some of the profound changes to society at the start of this third decade of the 21st century. Change is not new historically. But change is much more rapid today, making the industrial revolution of two and a half centuries ago seem almost like child’s play.

In the past century alone, manufacturing, transportation (automobiles and airplanes), medical (drugs and vaccines) and communication technologies are just a few of the many innovations that have made human lives better. But not all change is for the good — new stresses evolve that result in conflict and even war. How well we handle change is critical — it could mean either social progress or misery.

The determinants of social development are well documented in a 2010 book, Why the West Rules — For Now, by Stanford University archeologist and historian, Ian Morris. Going back to the beginning of homo sapiens, Morris argues that four factors have been critical to social development: information technology, urbanization/organization, energy capture and defence capability (which Morris terms “war-making”). Other factors — culture and institutions — are clearly relevant but are not measurably related.

Even at the dawn of history, warming in the Mesopotamian region provided opportunities for people to shift from hunting and gathering food to growing products. Agriculture led to the growth of villages and then cities. People found new ways to harness energy and transport products to markets. Military necessity led to new inventions that later had general applications.

So how does all this apply to the coming decade? Machine learning, or artificial intelligence, will have a profound effect, reducing the demand for routine work in accounting, finance, medicine, law and industrial processes. This is not new. Over the first half century now of the computer revolution we have seen the replacement of secretaries, back-office operations and a host of other non-computerized activities.

Two Oxford economists estimate that 47 per cent of U.S. employment will be displaced by AI, as businesses adopt new technologies varying from driverless trucks to automated record-keeping. However, fears of employment losses have been over-played (remember Jeremy Rifkin’s 1995 book on the end of work?). Various studies have shown that technological adoption ultimately leads to net employment gains as new products are developed and production costs fall throughout the economy.

The key issue therefore is managing the dynamic forces caused by technological change. A country could try to slow down or even stop innovation altogether but it would lose out to other countries that adapt to change more quickly. Or society could simply give up on displaced workers by guaranteeing a minimal income that would allow displaced workers to sit idly by. That would be foolhardy. Instead, policies that accommodate change, such as subsidized education, skill-training and wage subsidies would be a better approach for people seeking productive lives.

Morris argued that energy capture is a critical factor leading to social development. Think of Edison’s harnessing of electricity and what it has meant to social progress today. The growth of cheap and available energy has provided the means to develop many of today’s innovations.

Public policies focused on environmental factors, particularly climate change, will have a significant impact on the cost and reliability of energy supply this coming decade. Rash, non-scientifically based promises without a clear low-cost plan in mind to curb emissions could undermine social development.

Urbanization has led to significant economic gains as people specialize in specific endeavours to earn better incomes and acquire greater access to a wider variety of goods and services traded in a local region. But along with urbanization comes congestion, productivity losses from long commutes, higher housing prices at the city core and urban poverty.

Canada does not have the mega-cities found in Brazil, China, India and Mexico but high housing prices and urban poverty already afflict our largest centres. To accommodate urban growth, housing supply and transportation networks need to help keep a lid on costs. Urban policies that discourage housing supply (zoning restrictions, rent controls and poorly designed tax policies, for example) make urban living less desirable for many, especially new homeowners, who must look for alternative arrangements.

As for defence capacity, artificial intelligence, energy capture and surveillance capabilities will all have a significant impact on power structures this coming decade. Privacy concerns will challenge intelligence gathering by governments and corporations. Wars will be conducted without people. Cyber-attacks could impose substantial harm on infrastructure. A war in space is not inconceivable.

The leading artificial intelligence centres are the world’s two largest countries, China and the U.S., which are developing new capabilities in rivalry to each other. In Destined for War, Graham Allison suggests the two countries could be caught in the Thucydides’ trap, a reference to war between rising star Athens and dominant power Sparta. War is not inevitable if countries take steps to avoid confrontation. For Canada, our close relationship with the United States will require us to tread carefully with China.

This coming decade should be rich with rapid social development. Our challenge is to take advantage of the wonderful opportunities for growth it will offer while making sure we minimize the problems that come along with it. Avoiding change is not the answer.

Jack M. Mintz is the President’s Fellow at the University of Calgary’s School of Public Policy and is a Distinguished Fellow at the Macdonald-Laurier Institute.

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