renA.I.ssance?

Henry Ford is remembered for revolutionizing the automobile industry, doing so by introducing the assembly line. This innovation helped spur America’s obsession with cars.  This was, in part, possible because the productivity gains of his creation made cars more accessible to more than just the elite.  There were other knock-on effects as well.  For instance, it became necessary for America’s interstate highway system to be developed, opening the nation for more tourism and commerce.  All those cars needed fuel along the way, so a network of petrol stations needed to be built offering local jobs which further supported local economies.

Today we could be witnessing another leap in productivity which could have positive knock-on effects.  Artificial Intelligence (AI) is quickly automating modern repetitive tasks like programing and analyzing vast amounts of information.  It is doing so across broad sectors like manufacturing and healthcare.  In theory, it will speed up processes and reduce errors, freeing up human workers to pursue creative and strategic matters.

All of this efficiency, however, cannot exist in a vacuum.  Instead, infrastructure is necessary to keep the technology humming.  For instance, networks need to be developed further and installed to accommodate the vast amount of data processing.  At the very least, this means that the installation of data centers, high-speed internet capabilities, and secure cloud services will all be needed.  And this all requires a lot of energy, so power generation is needed.  Some firms have already gone so far as to acquire nuclear facilities to power their specific needs.  Along with the staff required to build out the other infrastructures, these power plants will need employees to run them.

Ford changed the American experience.  The internet did the same.  AI might just be the next big catalyst for changing the quality of life here and around the globe.  All the physical investment needed in an attempt to realize AI’s potential will also create profits across the supply chain, a portion of which will be captured by the government in the form of taxes.

This optimism really has momentum doesn’t it?  Atlas is not so naïve as to think there aren’t negatives in this new era.  We do have Ford’s productivity to thank for urban sprawl, traffic congestion and air pollution.  Some economic hardships were exacerbated as well when the focus on mass production and efficiency sometimes led to poor working conditions.  There will be negative impacts as a result of AI. The hope, of course, is that they are overwhelmed by the positives. This is yet to be seen, and Atlas Indicators keeps an open mind about the potential future.