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Comment by ArtTimeInvestor | Hacker News Reader

It's important to note that compared to human labor, AI is extremely cheap.

Society as a whole will produce more products and services and have to work less for this.

In other words, products and services will become much cheaper.

In the future, living on social welfare might offer a lifestyle more luxurious than working full-time is now.

So if most peoples life goes from "I have to work hard to pay my bills" to "I don't have to work as hard and can afford more", that will not drive people to go fight on the streets.

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Because the productivity growth in the last decades thanks to automation and many other factors has benefited workers? (Hint: It has not.)

https://www.epi.org/productivity-pay-gap/

The questions of who will benefit from AI is a political questions. As power is currently firmly in the had of the capital class, AI will only make the rich richer and the poor poorer.

Wages are not based on how much value you produce but how much it cost to reproduce your labor. How much it cost for you to stay alive and be able to work and feed your family. What kind of living standard that entails is a political matter and depends on how strong your unions are, how willing you are to fight for it and so on.

Same with welfare. It is something which was fought for and if the power balance is such that they can get away with giving you less, they will do. In fact some rich pricks would gladly turn you into soylent green if they could get away with it.

Hint it has - the standard of living is far higher now; medical care is far better; and the number of people subsidized by those working has greatly increased (this may not be considered a benefit, but it's where the extra income is going).

If your time axis is hundreds of years, yes. But the last decades don't fit that theory.

> As power is currently firmly in the had of the capital class, AI will only make the rich richer and the poor poorer.

I have hope in decentral technologies. Solar power is a rare example. If things gp right then in a few decades, your typical household will just not depend on anybody anymore in terms of energy needs. That's a significant shift.

That is, if big corps don't manage to capture that somehow, though I can't currently see how. But it has happened before. The www and email used to be as decentralized as you could imagine. Nowadays rarely any email gets sent that doesn't come from or go to a gmail server, or definitely not outside one of the biggest 3 providers. Similarly with the www. Everything is so centralized now, it's a great success of big tech.

If most people don't work (or most people's work contributes only a small fraction of the economy), where do they derive their political capital that gives them any social welfare at all? Why would the powerful AI overlords owned by large conglomerates give them anything or care what they think?

People who don't work today have more political capital than workers because they have the free time to vote and attend primaries and protests and town hall meetings and things like that.

> It's important to note that compared to human labor, AI is extremely cheap.

Frontier models are being provided at a loss right now to my "knowledge", and they're already as crap as you'd want to go, if not even crappier, for worker replacement in my experience.

Frontier models probably cost hundreds a month, so they are being provided at a loss. Humans cost thousands a month. Both can be true.

Sure, what I was going for was more in the sense that they'll likely increase in consumer price in the future. It will still possibly worth it, just an important thing to consider.

It costs hundreds a month for the customer, but way more for the companies. Try claude code, it's pay as you go, and it's like .5$ to 1$ per task, and it doesn't even complete it well, so if you make it work 24/7, I'm pretty sure it's gonna swallow your money for a result weaker than with a regular engineer. Moreover, you need someone to check what the AI is doing AND you need to prompt it properly (unless the CEO is willing to do that himself)

So right now, I have a really hard time seeing LLMs as a well-spent money if they were bought at their real cost

OpenAI lost $5 Billion in 2024. They have talked about their programming agent running $20k/month. There will be a price point where AI coding assistant makes zero sense for many companies.

The fruits of virtually all the productivity gains in the last 40 years has gone straight to the top while the 99% has stagnated amidst rising costs in essentials. Broadly-shared prosperity has only come about through strong unions, regulation, and redistributive taxation, which seems politically farther away than it's been in decades. The wealthiest elite don't just want wealth, they want power over others -- why would they tolerate an economic system where anyone can live a decent life independent of work?

That view is refreshingly naïve and equally wrong. Prices are determined by the market, not by how hard something was to produce.

And as exhibit A I provide progress in automation in the last decades (enormous) in relation to the median buying power of the population in developed nations.

It just doesn't work the way you describe, but I have sympathies for naïvely believing that it does.

This is both overly optimistic and overly simplistic.

It doesn't matter how many products and services your society shits out, what matters is how you organize it. And clearly we're already way past the point where the amount of products and services is a bottleneck to quality of life. Access to healthcare, job security, home ownership, the ability to afford kids, good food, all of these things are going down, not up, despite the fact that as a whole we're much better off than in the last century.

Virtually no one can sustain a family on a single salary, it was the norm not so long ago

https://www.researchgate.net/profile/Haruki-Seitani/publicat...

Housing is more and more out of reach

https://www.researchgate.net/publication/335721006/figure/fi...

Most of the productivity gain doesn't translate into income:

https://files.epi.org/charts/img/235212-28502-body.png

Sure enough we now have access to instant brain rot doomscrolling services, infinite low quality entertainment, vast amount of ultra processed food, &c. but if anythings these things are distractions.

I see it another way. I think the products will become cheaper to produce but the prices will remain the same or higher. Just because something is cheaper does not mean businesses are obligated to reduce price. If anything it's the opposite (as long as you can get away with it).

In a competitive market, prices tend to fall to the zero profit point. Of course nobody survives on zero profit for long, so that's not exactly the reality, but it is the pressure. If an Item becomes cheaper to produce, and Company A and Company B both produce the item, one of them will drop the price to get more sales at a slightly lower profit per Item. And back and forth.

That's just the theory though, if you look at the videogame industry, the prices keep rising and lazy productions are more expensive than ever (e.g. oblivion remastered).

Same goes for my movie theater, when did it x2 its price in the past 5 years while having less employees ? Oh wait, there's only one theater in town and I don't have a car, that's probably why.

Living on social welfare now offers a lifestyle as luxurious as working full-time in the past.

Only in a handful of countries.

I think you’re very generously assuming that the benefits of AI will be distributed evenly across society and not horded by the people who can afford to train hundred billion parameter models. That’s not how technology has worked in the past, so I don’t see why it should work differently this time.

Or we’ll produce the same amount of stuff, the billionaires controlling the AI will run off with all the money and the rest of us will starve whilst anyone that argues is hunted down by autonomous drones.

Either the state of political education is terrible or people have too much money stuffed in their ears to understand concepts that normal people need just to survive (at times).

Taken for granted that AI is extremely cheap. Product and services don’t become cheaper just because they are easier to produce. One way to get rich is artificial scarcity.

Now the only way I know that people in most jobs got better pay was to organize. Including striking. You can’t bully people too much if they can shut down sectors of the local community or country.

Cheap AI can make things cheap. Or not. Who owns it? Some dozens of rich people? Do they have to make it cheap? Do governments have to make living on social welfare (who says there will be social welfare?[1]) “more luxurious than working full-time is now” when you look around and... there’s no one to pressure them to do that any more?

[1] Some people with a lot of money stuffed in their ears think that social welfare is something that the poors/the lazy can just fall back on indefinitely. They know nothing about means testing or the fact that social welfare has been fought against by the very rich (ideologues who are savvy, they certainly didn’t stuff money in their ears) since social welfare was introduced.

Access to cheap goods may lead to short term satisfaction, but will never lead to long term fulfillment.

Cheaper products is a very narrow definition of luxury.

so deflation and print money like crazy for UBI?

[Citation needed]

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