Fast forward around 20 or 30 years, and Tesla has 100s of million of bots out to the public.
How has the world evolved, what does an economy look like. Let's explore what might actually
happen if Tesla's bots are able to replace a lot of labor, a lot of jobs, transportation,
farming, manufacturing, cleaning, cooking, etc. We wont go as far to say every job,
I don't think we will take AGI all the way, I don't know how possible that is. But certainly
bots may be able to act as an assistant at least for many jobs, further leveraging them,
and offering more abundance, if they are not able to replace them fully. Let's discuss the
consequences this may have, perhaps not just positive, but maybe negative too. We
would also need to think abut the morals and ethics that Tesla might take along this path,
of hopefully transforming the world, to somewhat of a realistic utopia we can perhaps imagine.
ENERGY We would also expect
at this stage most of the energy the world is consuming is being produced by harnessing the
photons the sun provides. Accompanied with the necessary complimentary battery storage.
TRANSPORT In this scenario
we will also expect similar advances with transport too. In other words we
have electric autonomous transportation. Possibly even aided by the Boring Company.
JOBS
What kind of jobs would be replaced. Well lets start with jobs on production lines, we even saw
it a demonstration of a bot working at a station on Fremont. This would therefore reduce the cost
of production. Let's assume we have perhaps 80% of human labor replaced on Tesla's solar panels line
for example. Then jobs in mining, we would want bots to be able to mine as much as possible too.
What are we saying here? Tesla bots can replace a lot of the labor through the entire supply
chain and production of solar panels. They can also run on solar energy. The entire cost of
all this is going to be minimal. From mining the resources, to transporting the to the refineries,
to the factories, to delivering them to the user. A lot of this can be done
with bots powered by energy that is made from the solar panels they are making.
So though all this bot labor Tesla have reduced the cost of solar panels that
are making the energy to build the bots. Also the bots are likely on the production lines,
making other bots too. Tesla's bots and energy cost just keeps reducing.
DISPLACED What will happen to all
these displaced jobs, on the likes of production lines or in mining? Well a lot of workers lose
their job. This has been a popular belief for sometime, that technology will replace jobs, yet
in reality it hasn't been the case. It has instead offered more jobs in other positions, and offering
more leverage. Thus more abundant supply at lower costs, and increased demand for whatever products
these are, often resulting in more jobs available. However, instead these new jobs require a higher
standard of worker. The layman has less and less jobs available, and instead need to become more
qualified in learning an actual skill, that is less easily replaced by a robot or machine.
For example when there the loom finally evolved enough in the textile industry,
it displayed a lot of jobs from workers who used to weave fabric. They thought this would reduce
jobs available. However, instead it dramatically reduced the costs of textiles and thus clothes.
Before then clothes were inherited by most families. When someone was buried it was never
in their best clothes, as they were simply too valuable. Now we have wardrobes full of clothes,
we throw them out because they are no longer fashionable rather than worn out.
Clothes have become more abundant, whilst also creating more jobs in the process.
However, these robots could displace workers at a faster rate than they could be retrained or
new industries open up for them fast enough. Thus potentially resulting in a lot of unemployment.
That is a potential scenario. However, in the long term the economy may re-adjust.
In Tesla's example, due to solar panels becoming a significantly lower cost to build,
it would then result in lower cost energy. With lower cost energy many more businesses suddenly
become more feasible, thus opening up more commerce and opportunities,
the same obviously extends to lower cost transport. On top of that living costs would
be lower too due to all of this, so people can justify working on jobs that were not
previously feasible, as they now pay enough to get by on this new lower cost of living.
ABUNDANCE Presumably all
these cost savings that Tesla have producied are going to passed on to the consumer. The
barriers to entry are simply too high for the competition, so we have lost capitalism and
we have a monopoly. Elon does say that Tesla is a philanthropic institution.
We might therefore expect Tesla to just make acceptable profit margins, perhaps at 40-50%,
rather than ridiculous margins, despite adding so much value into the economy.
This value that is added, then proliferates through the economy in a delationary way,
reducing the cost of energy, and transport, and as a result, basically everything else. These people
who's jobs have been displaced, suddenly require less money to live on in this new
lower cost economy, and are thus able to justify working for less income on
a job than previously, yet still have higher living standards than before.
Otherwise Tesla would be sucking too much money out of the economy, and not placing it back in,
especially if they aren't even paying wages to workers who would go off and consume and
recirculate the money back into the economy. Tesla would otherwise be a dead end for money,
and Elon has said Tesla wont even pay dividends. This would
eventually hurt the economy, and as a result Tesla's sales within time
too. It is therefore essential that Tesla return this cost saving back to citizens.
UBI As for the displaced workers,
who's previous work has now been replaced by a robot perhaps some sort of universal basic income
is actually necessary during the transition, the catch is that it's not the government,
but Tesla that are subsidizing it. Tesla could even pay with kWh rather than dollars,
and kWh would be a currency that is backed by something real. Compared to fiat currencies of
today. I mean it wouldn't really need to UBI, it could be more some sort of welfare program,
just allowing people time to retrain in new vocations due to the transition happening at
such a rapid rate. I just say UBI as Elon does often talk about it.
OVER CONSUMPTION So we have these robots that are able to leverage
so much labor, and offer us so many goods at much lower cost than before. They can mine so much,
so fast, and produce so much at such low cost. However, that doesn't mean we simply want to
consume all available resources on the planet that much faster,
just so the current population can live in the now, and leave little for future generations.
Classes Elon makes it almost
sound like society will be totally egalitarian, I am not sure if he actually means it realistically,
but I can't see it happening. In this world of abundance that we envision, perhaps now everyone
could potentially afford to go out to eat to a restaurant for every dinner, do you think
the likes billionaires would want to mix with regular people? That is not the way society works,
especially some more than others. There are still systems of class. There is also human psychology.
Some people want exclusivity, to feel special, or better than regular people. In other words,
although there may be enough restaurants for everyone, with enough food for everyone,
with affordable enough prices for everyone to eat at, I would say there will still be
certain tiers. And people would be willing to pay more for an amazing view, or iconic location.
And of course some food is simply more scarce than others. Bots wont meant mean that there
is suddenly enough kobe beef for everyone. And although perhaps a bot maybe able to make food
better than your average chef, in less time, at less cost, they may not be able to make
food better than a top chef, with more time and a much larger budget. There will still be
some forms of scarcity. And there will still be parts of society willing to pay for more.
What is important is that there shouldn't be people starving.
So as Elon says he isn't even sure there would be an economy would look like in this scenario,
as long as there is scarcity, there is still an economy. There will be people willing to work,
to have more. They can train to be in positions that bots are not suited for. We will also still
want people to start businesses, even if they are run by bots. People will likely have more time on
their hands, as they may need to work less, so there will be a big demand for entertainment,
and humans can be creative in all types of businesses that keep us entertained.
Therefore I think there still needs to be a medium of exchange and store of value.
Along with opportunities in order to earn more. Except there is the possibility that
simple jobs are no longer possible, and there is a higher level of entry.
PHILANTHROPY We would need to hope
that Tesla will have a massive philanthropic venture to better the entire globe. It's one
thing being motivated to replace non-renewable energy in poorer nations, with a form of a lower
cost renewable energy, but labor is different. The cost energy has a global price, the cost
labor has a local price. 85% of the world still live on less than $30 a day. The cost of a bot
may not be feasible for a lot of these nations, and may still need labor to do these mundane,
or dangerous tasks. I'm not sure I have an answer for this yet, and requires more thought.
I would however expect that the robots make batteries and solar so much more affordable,
that it should extend to these developing nations. A lot of them still use diesel for
energy. This is the worst for climate change, and is the most expensive form of energy for homes.
SUMMARY The realms of possibilities
of what an economy could look like with bots could fill a book. I could go into so much more detail
in so many areas. But don't confuse a world of abundance, with a world without scarcity.