Election is over. Wounds will be healed. Campaign rhetoric will calm down. People will return to their daily lives and America will go back to focusing on its future. Trump’s victory, largely led by the voices that got ignored by the previous administrations, provides a clear mandate for the Trump administration. The minor problem: when it comes to technology, the Trump mandate is mostly silent. The major problem:technology strategy by the Trump administration can be at odds with the low-to-medium skilled job creation promise on one hand or lead to decline in American competitiveness on the other hand. Let’s analyze this.
THE REAL RISK FOR AMERICA
Mr. Trump’s election rhetoric has been often criticized as dangerous for America. Media often termed him as risky for American values, temperamentally unsound to have his finger on the nukes, and dangerous for international relations. Anyone who knows America well enough understands that no one person governs America and a lot of campaign rhetoric is about fear-mongering. So we can put all that campaign rhetoric behind us. But now that the election is over, we can talk about the real risks. The real risk to America – and regardless of who would have won the election – is not what you have heard in the popular media. The real risk is that Mr. Trump is now stuck between a rock and a hard place. If he creates low to medium skilled jobs he will make America less competitive. If he doesn’t, he will fail to fulfill his promise.
ROADS, BRIDGES, WALLS AND …… BIG DATA
During Mr. Trump’s campaign, we have heard about roads and bridges, about walls and airports, about manufacturing plants and coal mines – but we have not heard about big data or artificial intelligence or cognitive solutions or connected economy or networked world or collective consciousness via social media. It is perfectly understandable that in order to win the election Mr. Trump had to focus on the problems that many Americans can relate to: manufacturing job loss. Technology on the other hand, is considered elitist, and in some ways anti-jobs due to its automation potential.
Several recent articles have claimed that Mr. Trump’s assertion that we are losing manufacturing jobs to China is incorrect as the reality is that we are losing jobs to robots. One of the articles published on ABC News says: A study at Ball State University’s Center for Business and Economic Research last year found that trade accounted for just 13 percent of America’s lost factory jobs. The vast majority of the lost jobs — 88 percent — were taken by robots and other homegrown factors that reduce factories’ need for human labor.
I bet you can now appreciate the problem: if President Trump wants to add low skilled manufacturing jobs, he would have to push back on automation technologies. Conversely, if he roots for the tech sector, and if trade deals are made more favorable and America gets a larger share of global manufacturing, that would only result in more human-less factories in America. Add to this the fact that if investments are not made in automation, it will only mean that in the long-run American competitiveness will decline. The temporary fix will create some short-term jobs but will destroy American competitiveness in the global economy. If we create jobs for the sake of creating jobs and ignore the competitive dynamics of technology and its productivity potential, we will turn United States into a USSR styled job creator.
It is important for America to understand that regardless of what popular media poses as risks – what we discussed above is the greatest dilemma for the Trump presidency.
TECH STOCKS ARE SAYING SOMETHING
So no wonder technology stocks are taking a hit. Concerns are mounting in the technology sector that the sector will be pushed back into research labs and that it will lose the momentum it has built in the last 10 or so years.
When Obama administration came in, it had a clear tech strategy. But a lot of that strategy focused on government transparency and social media. The world of technology has now changed. The world has moved away from “dumb” technology to smart and autonomous artificial intelligence based technology. And that change has grave implications for the Trump administration.
ARTIFICIAL INTELLIGENCE AND JOBS
Frey and Osborne estimated that just about half the jobs can be impacted by the rise of artificial intelligence related automation (Frey and Osborne, 2013). Brynjolfsson and McAfee, two MIT professors, have studied the emerging phenomenon in great depth (Brynjolfsson and McAfee, 2015). Specifically, they observed that four measures of economic health: per capita GDP, labor productivity,the number of jobs, and median household income tend to grow in tandem but in the last 15 years GDP and Productivity have grown while Income and jobs have declined – a concept they call the Great Decoupling. (Interview HBR, 2015).
What Brynjolfsson and others, for example Autor (Autor, 2015), have observed is that while it is possible that there will be jobs, the need for skilled jobs will grow while the demand for unskilled or lower skilled jobs will diminish. Also, what was considered a “high skill” job today may be downgraded to low skill job tomorrow.
HOW TO SOLVE THE DILEMMA?
President Trump has to focus on the following 5 step plan:
1) ESTABLISH A LINK BETWEEN INFRASTRUCTURE PROJECTS AND AUTOMATION: Build a bridge between the infrastructure projects and technology. Make technology a key part of the infrastructure projects. Work with the tech sector to outline the infrastructure strategy. For example, illegal drugs are a major problem for our communities – and bricks and cement are not the only means to guard our borders. Robots, drones, detection technologies etc. can also play a major role to understand and obstruct the supply chain of illegal drugs into the United States.
2) TRAINING, TRAINING, TRAINING: Don’t just promise the return of the old style manufacturing jobs – because that may never happen at the scale necessary to overcome the job loss. Also focus on retraining the workforce of the future. This means opening education and training centers all over rural America. This means overcoming the propensity to think that access to education is only possible if you are living in, or near, large cities. This means building Silicon Prairie, Silicon Mountain, Silicon Plains, Silicon Atlantic …. and not just Silicon Valley. The training needs to be in sciences, technology, engineering, and mathematics. But it needs to be practical, focused, and job centric.
3) PROMOTE THE TECH SECTOR: Do not fall into the trap of “tech is elitist” and “old guards have nothing to do with it” mindset. We cannot afford to go back to the Bush era policies that focused so much on security that for many it seemed that they ignored the consumer tech sector. We need to push both: industrial and consumer tech sectors. President Trump must announce a comprehensive position on technology and sciences.
4) BRING ARTIFICIAL INTELLIGENCE INTO GOVERNMENT: If President Trump wants to fund his programs and cut taxes at the same time, he would need to find money elsewhere. Cutting Medicare or Medicaid can be deeply unpopular among some of the same people who voted for him. The answer is a more efficient and smaller government. Yet given the complexity of our world, diminishing the role of the government can pose its own risks. The solution: figure out how to get more done by the government with less – the answer is Artificial Intelligence.
5) GOVERN ARTIFICAL INTELLIGENCE: Artificial Intelligence is the most powerful and amazing technology ever created by humans. It can solve some of our greatest problems. However, we need to govern the potential impacts of the technology. This means an AI governance system that doesn’t hinder advancement but ensures safety and wellness of humans. Before unleashing solutions, it will be important to understand their impact on human civilization and our processes (political, economic, social etc.).
I have seen the devastation of manufacturing job loss first hand. I have lived in rural America and can relate to the voter anger. I have seen the disappointments and problems of the middle class in the MidWest. And it is important that we don’t give people hope if we can’t deliver on it. It is important to build their economic strength not just as a bandaid fix, but as a long-term economic solution. They need jobs but also training and education in technology, math, and sciences. That, I am convinced, is the only way out. I welcome President-elect Trump’s election. Now it is time to Make America Great Again – and do it such that no one is left behind.
Brynjolfsson, E. & McAfee, A. (2015) Will humans go the way of horses? Labor in the second machine age. Foreign Affairs. 94 (4), .
Frey C. B. and Osborne M. A. 2013 The Future of Employment: How Susceptible Are Jobs to Computerisation? Oxford University http://www.oxfordmartin.ox.ac.uk/downloads/academic/The_Future_of_Employment.pdf
Interview HBR (2015) The Great Decoupling. Harvard Business Review. (June), 68–74.