Posted on 04/13/2026 5:47:47 PM PDT by ProtectOurFreedom
If AI displaces human workers faster than the economy can reabsorb them, it risks eroding the very consumer demand firms depend on. We show that knowing this is not enough for firms to stop it. In a competitive task-based model, demand externalities trap rational firms in an automation arms race, displacing workers well beyond what is collectively optimal. The resulting loss harms both workers and firm owners. More competition and "better" AI amplify the excess; wage adjustments and free entry cannot eliminate it. Neither can capital income taxes, worker equity participation, universal basic income, upskilling, or Coasian bargaining. Only a Pigouvian automation tax can. The results suggest that policy should address not only the aftermath of AI labor displacement but also the competitive incentives that drive it.
(Excerpt) Read more at x.com ...
Are you asking how I give it instructions? Or what it is doing under the covers?
“Are you asking how I give it instructions? Or what it is doing under the covers?”
Many years we wrote a program (in Fortran) that created a “language” that biologists used to query an animal database.
Sounds like the same sort of thing going on with you.
The sheer and utter stupidity of this research is it ignored the biggest possibility to fix the problem. The problem isn’t solved by more taxes, but by innovation.
I’m using AI in my day job and outpacing my co-workers dramatically.
In my personal company, I’m writing software at a 100x speed factor in complexity that couldn’t be done before by using AI.
Instead of cutting 4000 jobs, innovate 10x and save those jobs and bring in a 10 fold increase in profits.
I’m keeping my current job as long as I want because I’ve become a force multiplier because I’m using AI. My previous job, I trained my H-1B replacement.
I’m having similar velocity increases.
And now imagine what, if you were running a business, you had 5 junior “programmers” who were using Claude Coder, Codex and Gemini CLI to develop along side you. You could turn your little personal apps into enterprise tools, innovate and use AI to find the proper exact structured response to users to elicit the best results.
But where are you going to find the 10X instantaneous increase in market size? Where would EVERY company find the needed 10X to 100X increase in market size?
The bottom line is it is going to take one-tenth as many people to do the work. And the brutal truth is market size will shrink as those workers no longer have income or greatly reduced income. At least until they learn to become electricians, millwrights, pipe fitters, etc. But then we will have a surplus of people in those trades.
This disruption is going to make things far uglier than anybody can foresee.
Kill bots will reduce the surplus population.
People were saying that the Internet was going to eliminate most employment 30 years ago. “There is nothing new under the sun.” Ecclesiastes 1:9
Back when I was working, I saw enough layoff of workers hoping to save money. I don’t know if they saved or not. Like as not , the new worker that they hired was worse than theone they fired. We called it “fouling your own nest”...we used slightly different words. I was rather forced to quit in a similar situation once. I was salaried & they said I wasn’t prodrucing enough. True....I wasn’t, but the salary wasn’t that great anyway & I took on every job they brought to me. Couldn’t do more than that. Got my old job back, put on commission (which was the original problem anyway)& a better working situation, so I made more. I had experienced 4 different owners when I worked there & wasn’t certain but maybe only one of them knew how to run a business properly. By then, my particular job had basically been sold out from under me to another dealer. Mark me down as happy to be out & retired before now.
Working on SSI and SS now I have had enough. I have been in IT for 25 years and I used to reject both but I have had a change of heart and decided I am done with it all. Going to get my share now while I can.
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