September 17, 2015
From 1980 to 2013, vast markets opened around the world while corporate-tax rates, borrowing costs, and the price of labor, equipment, and technology all fell. The net profits posted by the world’s largest companies more than tripled in real terms from $2 trillion in 1980 to $7.2 trillion by 2013,1 pushing corporate profits as a share of global GDP from 7.6 percent to almost 10 percent. Today, companies from advanced economies still earn more than two-thirds of global profits, and Western firms are the world’s most profitable. Multinationals have benefited from rising consumption and industrial investment, the availability of low-cost labor, and more globalized supply chains. ... But there are indications of a very significant change in the nature of global competition and the economic environment. While global revenue could increase by some 40 percent, reaching $185 trillion by 2025, profit growth is coming under pressure. This could cause the real-growth rate for the corporate-profit pool to fall from around 5 percent to 1 percent, practically the same share as in 1980, before the boom began. ... Profits are shifting from heavy industry to idea-intensive sectors that revolve around R&D, brands, software, and algorithms. Sectors such as finance, information technology, media, and pharmaceuticals—which have the highest margins—are developing a winner-take-all dynamic, with a wide gap between the most profitable companies and everyone else. Meanwhile, margins are being squeezed in capital-intensive industries, where operational efficiency has become critical. ... As profit growth slows, there will be more companies fighting for a smaller slice of the pie, and incumbent industry leaders cannot focus simply on defending their market niche.
The greatest anxiety troubling workers today is embodied in a simple question: How will we humans add value? Popular culture is obsessed by it. Humans, a new series on the AMC network, spins a story from the promise and perils of eerily humanoid robots called synths. That seems to be Hollywood’s 2015 theme of the year. Think of Ex Machina (humanoid robot outsmarts people, kills a man, enters society as a person) or Terminator Genisys (Arnold Schwarzenegger’s humanoid robot must again save the world) or Avengers: Age of Ultron (humanoid robot tries to eradicate humanity) or Chappie (bad guys try to destroy humanoid robot police officer who is reprogrammed to think and feel). The big idea is always the same: For good or ill, machines become just like people—only better. ... Fear of technological unemployment is as old as technology, and it has always been unfounded. Over time and across economies, technology has multiplied jobs and raised living standards more spectacularly than any other force in history, by far. But now growing numbers of economists and technologists wonder if just maybe that trend has run its course. ... How will we humans add value? There is an answer, but so far we’ve mostly been looking for it in the wrong way. The conventional approach has been to ask what kind of work a computer will never be able to do. ... A better strategy is to ask, What are the activities that we humans, driven by our deepest nature or by the realities of daily life, will simply insist be performed by other humans, even if computers could do them?
- Also: Bloomberg - A World Where Man Beats Machine < 5min
- Also: Financial Times - The economic myth of robotics and the robot job-ocalypse < 5min
- Also: Wall Street Journal - We’re Fighting Killer Robots the Wrong Way < 5min
- Also: MIT Technology Review - Rethinking the Manufacturing Robot
- Also: Quartz - Override: A story about the future of work 5-15min
In the spring of 2014, after a decade of visa problems, the Hassan family moved out of its spacious house in Karachi, Pakistan, to an apartment in Rosemont, a suburb of Chicago near O’Hare International Airport. They were a family of eight, two parents and six kids, jammed into a three-bedroom space. Money was tight and work unsteady; for most of them, the move was a struggle. But their 15-year-old son, Sumail, was thrilled—being in the U.S. meant less lag time when he played Dota 2. ... Sumail started playing Dota 2 as a 7-year-old. Now 16 ... His payday after one month as a professional gamer, and just before his 16th birthday, was $200,000. By mid-August, he could be a millionaire. ... By now, Cinderella stories like Sumail Hassan’s are a reliable staple of e-sports. These are, after all, games anyone can play at home, and the prevalence of high-speed Internet allows practically everyone to play everyone else in the world. The promise that a player can be plucked from obscurity and win huge prize money is part of what makes e-sports so popular—and it's wildly, crazily popular. About 27 million people watched the final of last year’s League of Legends championship, about 9 million more than watched the San Antonio Spurs clinch a stunning Game Five in the NBA Finals. ... As Sumail put it in one of his first interviews at the Asia tournament in February: “You have to go pro or just leave it. It’s a time waste if you’re not going full pro. It’s not for noobs.” ... A pool of maturing talents who by now have been playing games since they could walk, and the increase in tournaments, has transformed e-sports. ... But what’s really making it stick this time is live streaming.
He told potential investors he was about to salvage billions of dollars’ worth of Russian platinum lost inside the Port Nicholson when it was sunk en route to New York from Halifax. It would be easy. Brooks talked about potential returns as high as 100 to 1 and “was throwing out the word ‘guaranteed,’” claims Gorham resident Gary Auger. “He sold it like we were going to be multimillionaires within a year.” ... In Gorham, a town of 16,000 just outside of Portland with a tiny historic district, word of mouth spreads fast and reputation counts for a lot. Important for Brooks, the enterprise enjoyed the backing of one of Gorham’s most respected citizens: John Hardy Sr., a La-Z-Boy store owner and generous philanthropist who was Brooks’s landlord and only partner in Sea Hunters. Many people in Gorham trusted Brooks because Hardy vouched for him. One early meeting about Brooks’s venture took place after-hours at Hardy’s store in nearby Scarborough, with potential investors standing among the La-Z-Boys to hear the pitch. ... Brooks and Hardy raised a total of $5 million in 2008 and 2009 to salvage the Port Nicholson—much of it from small, middle-class investors in southern Maine, some from deeper-pocketed speculators in New York City. ... After a third summer with no returns, investors were growing concerned. Brooks blamed bad weather, rough currents, lost anchors, and equipment failures. “It seemed like every time he was just about to get it,” Auger says, “all of a sudden, he needed more money.” ... The two U-boat hustlers found each other. Michaud helped Brooks search for documents about his alleged Casco Bay U-boat. And Brooks helped Michaud hunt for his elusive sub, until—according to a court filing by Michaud—Brooks’s towfish was eaten by a shark.