Armies of robots are spreading throughout factories and warehouses around the world, as the accelerating pace of automation transforms a widening range of industries. And it is not just in advanced countries but in emerging economies as well where machines are a growing force, with global sales of industrial robots increasing by 18 per cent to a record $13.1bn in 2016, according to research by the International Federation of Robotics, IFR. The rise of the robots has coincided with a surge in share prices of some of the biggest manufacturers in the sector, including the Japanese groups Fanuc and Yaskawa, Swiss engineering conglomerate ABB and Kuka of Germany. Shares in Yaskawa have more than doubled this year, as have Kuka’s. Fanuc’s stock has gained 40 per cent and shares are up by almost one-sixth in ABB, which additionally supplies power, automation and electrical equipment. These groups are benefiting from mounting demand for sophisticated machines that no longer just weld car bodies and lift heavy loads, but also perform complex functions from electronic component production to putting chocolates into boxes. Share this graphic Another trend is the increasing range and type of robot, as they vary from flexible mechanical limbs to smart machines that can work alongside humans. Collaborative robots, or cobots, are specifically designed to interact with people. “The robotics market has been growing strongly over the past four to five years, and we are optimistic that the market is going to continue to grow over next three years,” says Per Vegard Nerseth, head of robotics at ABB. The spread of robots has piqued the debate over the suitability of humans versus robots as workers, with some leading business figures warning that more machines will take jobs. John Cryan, chief executive of Deutsche Bank, said in September that employees faced being replaced by robots, adding that a large number of people will lose their jobs as a result of changes in technology. “Generally, it is about cost arbitrage,” says Moshe Vardi, a professor at Rice University in Texas. “If the marginal hourly cost of an industrial robot is lower than the hourly cost of a human worker and the robot have the capability to do the job, then it makes sense economically to automate.” Research by consultants McKinsey has contributed to these fears of job losses. It found that about 30 per cent of tasks in 60 per cent of occupations could be automated. However Mr Nerseth argues that rather than destroying jobs, advanced automation is partly a response to a shortage of skilled manual labour, with robots often filling “dull, dirty, dangerous and delicate” roles that people simply do not want. “Today the main challenge for very many companies [is] they’re not able to find enough people to do the jobs and in that sense robots actually create jobs,” he says. “It’s very difficult to see today that robots are actually taking [jobs] away. I would say we are helping companies to become more competitive and efficient.” Countries with the lowest unemployment rates tend to have the highest density of robots, he adds. At the other end of the spectrum are nations ripe for greater adoption. Despite being the largest robot market, China is below the global average density with just 68 robots per 10,000 manufacturing workers. However, putting aside job fears, robots are clearly here to stay in an automation revolution that is driven by a desire for greater efficiency and speed in industrial processes, say industry experts. As components become smaller and more complex, robots can provide vital functions as they can handle the intricacies of manufacturing in ways humans cannot. Robots are also improving the quality of goods in an age of rising standards. An important force behind adoption is the falling cost of robotics systems. At the same time, breakthroughs in robotics technology are combining with the increasing level of electronic communication between equipment and computers in factories, sometimes called the industrial internet of things. Another factor helping the growth of robots is a shift in some industries from producing a small variety of goods in large batches, to a greater mix of products in smaller batches, says Mr Nerseth of ABB. “This is basically driven by us as consumers . . . we want more individualised products [and] that drives a need for flexibility,” he says, giving the example of cars with parts like wheel rims with customised colours. Although the largest user remains the car industry, which has deployed robots widely since the 1980s for welding and painting, the main driver of growth is the electronics and electrical sector, chiefly located in Asia. Share this graphic Share on Twitter (opens new window) Share on Facebook (opens new window) Email Part of that is down to the increasing need for batteries, chips and displays, according to the IFR. But robots are also entering other areas, such as logistics warehouses, chemicals and plastics factories and the food and beverage industries. In total, almost 300,000 units were sold worldwide last year, according to the IFR, with three-quarters bound for just five countries: China, South Korea, Japan, the US and Germany. Three in every 10 went to China alone. Once the manual labour “workshop of the world”, it has been the largest buyer of industrial robots since 2013, and its purchases jumped by 27 per cent last year. There were increased investments in many developing countries, as well, such as Taiwan, Thailand, India and Mexico, as well as in Italy and France. While there have been improvements in hardware capabilities, such as hydraulics and mobility, perhaps the most important developments are in sensors and software that are making robots more sensitive, flexible, precise and autonomous. “The software side of industrial robotics is becoming more and more important [and] a key differentiator between the different industrial robotics manufacturers,” says Jonathan Cohen, portfolio manager of the $90m RoboCap UCITS fund. It also represents a richer seam to mine. Including the cost of software, peripherals and systems engineering, the total value of the robotics systems market is estimated at about $40bn by the IFR. Important advances include vision recognition systems. Coupled with artificial intelligence and cameras, this allows robots to identify objects and learn from experience to improve performance, enabling a wider range of applications. In parallel, manufacturers have developed grippers with greater dexterity and responsiveness. Tom Bouchier, managing director of Fanuc UK, gives the example of confectionery makers using robots to pick and place sweets and chocolates into boxes. However, despite the growth in the market and investor enthusiasm, experts do not foresee machines taking over the workplace as robots still have many limitations when it comes to dexterity, judgment and the ability to improvise. “The biggest challenge is the flexibility a robot can offer,” says Daniel Kuepper, of Boston Consulting Group. He gives the example of an empty box of screws that a replenishment system has failed to refill. “A robot would now need to detect the box is empty and send an error message, while a human operator would do that and quickly pick up some new screws.” Cobots learn from human masters As people worry about being relaced by robots on the factory floor, the irony is that machines are beginning to learn new tasks from humans by imitation. This has opened up big possibilities for companies as they look to automate and improve efficiency. For example, by moving the robot’s arm, a flesh-and-blood employee can train it within minutes, as opposed to 50 to 200 hours of programming for a traditional industrial robot, says Jonathan Cohen of the RoboCap UCITS fund. “With a cobot [a robot that works with humans], you don’t need a programmer any more. Anyone can do it, it’s very user-friendly. You just move the hands, press record, do it for a few minutes, then the machine can do it autonomously,” he adds. Cobots are also smaller, lighter, more flexible and mobile, and even more critically cheaper, making it more affordable for small and medium-sized enterprises to invest. While usually slower, they have greater adaptability, because they can be assigned to different tasks. Although still a fairly small subsegment within industrial robotics, the cobot market is rapidly expanding. A significant manufacturer is Universal Robots, based in Denmark, which was acquired by Teradyne of the US for $285m in 2015. It expects to reach DKr1bn ($157m) in revenue by the end of this year, up from DKr40m ($5.6m) in 2011. Michael Pooler
Sunday, November 19, 2017
This week, Bill Gates announced his plan to invest almost $1.7 billion into reforming U.S. public education over the next five years.
Of that sum, he allocated 25 percent to “big bets – innovations with the potential to change the trajectory of public education over the next 10 to 15 years.”
I’ve been thinking a lot about the future of education – both for my two 6-year-old boys and the employees of my companies.
I started asking myself, given the fact that most elementary schools haven’t changed in decades (maybe longer), what do I want my kids to learn? How would I reinvent elementary school during an exponential era?
This blog covers five subjects related to elementary school education:
1. Five Issues with Today’s Elementary Schools
2. Five Guiding Principles for Future Education
3. An Elementary School Curriculum for the Future
4. Exponential Technologies in our Classroom
5. Mindsets for the 21st Century
Excuse the length, but if you have kids, the details might be meaningful. If you don’t, then next week’s blog will return to normal length and another fun subject. Let’s dive in…
Five Issues with Today’s Elementary Schools
There’s probably lots of issues with today’s traditional elementary schools, but I’ll just choose a few that bother me most.
1. Grading: In the traditional education system, you start at an “A,” and every time you get something wrong, your score gets lower and lower. At best it’s demotivating, and at worst it has nothing to do with the world you occupy as an adult. In the gaming world (e.g. Angry Birds), it’s just the opposite. You start with zero and every time you come up with something right, your score gets higher and higher.
2. Sage on the Stage: Most classrooms have a teacher up in front of class lecturing to a classroom of students, half of whom are bored and half of whom are lost. The one-teacher-fits-all model comes from an era of scarcity where great teachers and schools were rare.
3. Relevance: When I think back to elementary and secondary school, I realize how much of what I learned was never actually useful later in life, and how many of my critical lessons for success I had to pick up on my own. (I don’t know about you, but I haven’t ever actually had to factor a polynomial in my adult life.)
4. Imagination - Coloring Inside the Lines: Probably of greatest concern to me is the factory-worker, industrial-era origin of today’s schools – programs so structured with rote memorization that it squashes the originality from most children. I’m reminded that “the day before something is truly a breakthrough, it’s a crazy idea.” Where do we pursue crazy ideas in our schools? Where do we foster imagination?
5. Boring: If learning in school is a chore, boring or emotionless, then the most important driver of human learning, passion, is disengaged. Having our children memorize facts and figures, sit passively in class and take mundane standardized tests completely defeats the purpose.
An average of 7,200 students drop out of high school each day, totaling 1.3 million each year. This means only 69% of students who start high school finish . And over 50% of these high school dropouts name boredom as the No. 1 reason they left.
Five Guiding Principles for Future Education:
I imagine a relatively near-term future in which robotics and artificial intelligence will allow any of us, from ages 8 to 108, to easily and quickly find answers, create products or accomplish tasks, all simply by expressing our desires.
From ‘mind to manufactured in moments.’ In short, we’ll be able to do and create almost whatever we want.
In this future, what attributes will be most critical for our children to learn to become successful in their adult life? What’s most important for educating our children today?
For me it’s about passion, curiosity, imagination, critical thinking and grit.
1. Passion: You’d be amazed at how many people don’t have a mission in life… A calling… something to jolt them out of bed every morning. The most valuable resource for humanity is the persistent and passionate human mind, so creating a future of passionate kids is so very important.
For my 5-year-old boys, I want to support them in finding their passion or purpose… something that is uniquely theirs. In the same way that the Apollo program and Star Trek drove my early love for all things space, and that passion drove me to learn and do.
2. Curiosity: Curiosity is something innate in kids, yet something lost by most adults during the course of their life. Why?
In a world of Google, robots and AI, raising a kid that is constantly asking questions and running “what if” experiments can be extremely valuable. In an age of machine learning, massive data and a trillion sensors, it will be the quality of your questions that will be most important.
3. Imagination: Entrepreneurs and visionaries imagine the world (and the future) they want to live in, and then they create it. Kids happen to be some of the most imaginative humans around… it’s critical that they know how important and liberating imagination can be.
4. Critical Thinking: In a world flooded with often-conflicting ideas, baseless claims, misleading headlines, negative news and misinformation, learning the skill of critical thinking helps find the signal in the noise. This principle is perhaps the most difficult to teach kids.
5. Grit/Persistence: Grit is defined as “passion and perseverance in pursuit of long-term goals,” and it has recently been widely acknowledged as one of the most important predictors of and contributors to success.
Teaching your kids not to give up, to keep trying, and to keep trying new ideas for something that they are truly passionate about achieving is extremely critical. Much of my personal success has come from such stubbornness. I joke that both XPRIZE and the Zero Gravity Corporation were “overnight successes after 10 years of hard work.”
So given those five basic principles, what would an elementary curriculum look like? Let’s take a look…
An Elementary School Curriculum for the Future
Over the last 30 years, I’ve had the pleasure of starting two universities, International Space University (1987) and Singularity University (2007). My favorite part of cofounding both institutions was designing and implementing the curriculum. Along those lines, the following is my first shot at the type of curriculum I’d love my own boys to be learning.
For the purpose of illustration, I’ll speak about ‘courses’ or ‘modules,’ but in reality these are just elements that would ultimately be woven together throughout the course of K-6 education.
Module 1: Storytelling/Communications
When I think about the skill that has served me best in life, it’s been my ability to present my ideas in the most compelling fashion possible, to get others onboard, and support birth and growth in an innovative direction. In my adult life, as an entrepreneur and a CEO, it’s been my ability to communicate clearly and tell compelling stories that has allowed me to create the future. I don’t think this lesson can start too early in life. So imagine a module, year after year, where our kids learn the art and practice of formulating and pitching their ideas. The best of oration and storytelling. Perhaps children in this class would watch TED presentations, or maybe they’d put together their own TEDx for kids. Ultimately, it’s about practice and getting comfortable with putting yourself and your ideas out there and overcoming any fears of public speaking.
Module 2: Passions
A modern school should help our children find and explore their passion(s). Passion is the greatest gift of self-discovery. It is a source of interest and excitement, and is unique to each child.
The key to finding passion is exposure. Allowing kids to experience as many adventures, careers and passionate adults as possible. Historically, this was limited by the reality of geography and cost, implemented by having local moms and dads presenting in class about their careers. “Hi, I’m Alan, Billy’s dad, and I’m an accountant. Accountants are people who…”
But in a world of YouTube and virtual reality, the ability for our children to explore 500 different possible careers or passions during their K-6 education becomes not only possible but compelling. I imagine a module where children share their newest passion each month, sharing videos (or VR experiences) and explaining what they love and what they’ve learned.
Module 3: Curiosity & Experimentation
Einstein famously said, “I have no special talent. I am only passionately curious.” Curiosity is innate in children, and many times lost later in life. Arguably, it can be said that curiosity is responsible for all major scientific and technological advances – the desire of an individual to know the truth.
Coupled with curiosity is the process of experimentation and discovery. The process of asking questions, creating and testing a hypothesis, and repeated experimentation until the truth is found. As I’ve studied the most successful entrepreneurs and entrepreneurial companies, from Google and Amazon to Uber, their success is significantly due to their relentless use of experimentation to define their products and services.
Here I imagine a module which instills in children the importance of curiosity and gives them permission to say, “I don’t know, let’s find out.”
Further, a monthly module that teaches children how to design and execute valid and meaningful experiments. Imagine children who learn the skill of asking a question, proposing a hypothesis, designing an experiment, gathering the data and then reaching a conclusion.
Module 4: Persistence/Grit
Doing anything big, bold and significant in life is hard work. You can’t just give up when the going gets rough. The mindset of persistence, of grit, is a learned behavior and I believe can be taught at an early age, especially when it’s tied to pursuing a child’s passion.
I imagine a curriculum that, each week, studies the career of a great entrepreneur and highlights their story of persistence. It would highlight the individuals and companies that stuck with it, iterated and ultimately succeeded.
Further, I imagine a module that combines persistence and experimentation in gameplay such as that found in Dean Kamen’s FIRST LEGO league, where 4th graders (and up) research a real-world problem such as food safety, recycling, energy and so on, and are challenged to develop a solution. They also must design, build and program a robot using LEGO MINDSTORMS®, then compete on a tabletop playing field.
Module 5: Technology Exposure
In a world of rapidly accelerating technology, understanding how technologies work, what they do and their potential for benefiting society is, in my humble opinion, critical to a child’s future. Technology and coding (more on this below) are the new “lingua franca” of tomorrow.
In this module, I imagine teaching (age appropriate) kids through play and demonstration. Giving them an overview of exponential technologies such as computation, sensors, networks, artificial intelligence, digital manufacturing, genetic engineering, augmented/virtual reality and robotics, to name a few. This module is not about making a child an expert in any technology, it’s more about giving them the language of these new tools, and conceptually an overview of how they might use such a technology in the future. The goal here is to get them excited, give them demonstrations that make the concepts stick, and then to let their imaginations run.
Module 6: Empathy
Empathy, defined as “the ability to understand and share the feelings of another,” has been recognized as one of the most critical skills for our children today. And while there has been much written, and great practices for instilling this at home and in school, today’s new tools accelerate this.
Virtual reality isn’t just about video games anymore. Artists, activists and journalists now see the technology’s potential to be an empathy engine, one that can shine spotlights on everything from the Ebola epidemic to what it’s like to live in Gaza. And Jeremy Bailenson has been at the vanguard of investigating VR’s power for good.
For more than a decade, Bailenson’s lab at Stanford has been studying how VR can make us better people. Through the power of VR, volunteers at the lab have felt what it is like to be Superman (to see if it makes them more helpful), a cow (to reduce meat consumption) and even a coral (to learn about ocean acidification).
Silly as they might seem, these sorts of VR scenarios could be more effective than the traditional public service ad at making people behave. Afterwards, they waste less paper. They save more money for retirement. They’re nicer to the people around them. And this could have consequences in terms of how we teach and train everyone from cliquey teenagers to high court judges
Module 7: Ethics/Moral Dilemmas
Related to empathy, and equally important, is the goal of Infusing kids with a moral compass. Recently I toured a special school created by Elon Musk (the Ad Astra school) for his five boys (age 8 to 13). One element that is persistent in that small school of 31 kids is the conversation about ethics and morals, a conversation manifested by debating real-world scenarios that our kids may one day face.
Here’s an example of the sort of gameplay/roleplay that I heard about at Ad Astra, that might be implemented in a module on morals and ethics. Imagine a small town on a lake, in which the majority of the town is employed by a single factory. But that factory has been polluting the lake and killing all the life. What do you do? It’s posed that shutting down the factory would mean that everyone loses their jobs. On the other hand, keeping the factory open means the lake is destroyed and the lake dies. This kind of regular and routine conversation/gameplay allows the children to see the world in a critically important fashion.
Module 8: The 3R Basics (Reading, wRiting & aRithmetic)
There’s no question that young children entering kindergarten need the basics of reading, writing and math. The only question is what’s the best way for them to get it? We all grew up in the classic mode of a teacher at the chalkboard, books and homework at night. But I would argue that such teaching approaches are long outdated, now replaced with apps, gameplay and the concept of the flip classroom.
Pioneered by high school teachers Jonathan Bergman and Aaron Sams in 2007, the flipped classroom reverses the sequence of events from that of the traditional classroom.
Students view lecture materials, usually in the form of video lectures, as homework prior to coming to class. In-class time is reserved for activities such as interactive discussions or collaborative work – all performed under the guidance of the teacher.
The benefits are clear:
1. Students can consume lectures at their own pace, viewing the video again and again until they get the concept, or fast-forwarding if the information is obvious.
2. The teacher is present while students apply new knowledge. Doing the homework into class time gives teachers insight into which concepts, if any, that their students are struggling with and helps them adjust the class accordingly.
3. The flipped classroom produces tangible results: 71% of teachers who flipped their classes noticed improved grades, and 80% reported improved student attitudes as a result.
Module 9: Creative Expression & Improvisation
Every single one of us is creative. It’s human nature to be creative… the thing is that we each might have different ways of expressing our creativity.
We must encourage kids to discover and to develop their creative outlets early. In this module, imagine showing kids the many different ways creativity is expressed – from art to engineering to music to math – and then guiding them as they choose the area (or areas) they are most interested in. Critically, teachers (or parents) can then develop unique lessons for each child based on their interests, thanks to open education resources like YouTube and the Khan Academy. If my child is interested in painting and robots, a teacher or AI could scour the Web and put together a custom lesson set from videos/articles where the best painters and roboticists in the world share their skills.
Adapting to change is critical for success, especially in our constantly changing world today. Improvisation is a skill that can be learned, and we need to be teaching it early.
In most collegiate “improv” classes, the core of great improvisation is the “Yes, And…” mindset. When acting out a scene, one actor might introduce a new character or idea, completely changing the context of the scene. It’s critical that the other actors in the scene say “Yes, and…” accept the new reality, then add something new of their own.
Imagine playing similar role-play games in elementary schools, where a teacher gives the students a scene/context and constantly changes variables, forcing them to adapt and play.
Module 10: Coding
Computer science opens more doors for students than any other discipline in today’s world. Learning even the basics will help students in virtually any career, from architecture to zoology.
Coding is an important tool for computer science, in the way that arithmetic is a tool for doing mathematics and words are a tool for English. Coding creates software, but computer science is a broad field encompassing deep concepts that go well beyond coding.
Every 21st century student should also have a chance to learn about algorithms, how to make an app or how the Internet works. Computational thinking allows preschoolers to grasp concepts like algorithms, recursion and heuristics – even if they don’t understand the terms, they’ll learn the basic concepts.
There are more than 500,000 open jobs in computing right now, representing the No. 1 source of new wages in the United States, and these jobs are projected to grow at twice the rate of all other jobs.
Coding is fun! Beyond the practical reasons for learning how to code, there’s the fact that creating a game or animation can be really fun for kids.
Module 11: Entrepreneurship & Sales
At its core, entrepreneurship is about identifying a problem (an opportunity), developing a vision on how to solve it, and working with a team to turn that vision into reality. I mentioned Elon’s school, Ad Astra: here, again, entrepreneurship is a core discipline where students create and actually sell products and services to each other and the school community.
You could recreate this basic exercise with a group of kids in lots of fun ways to teach them the basic lessons of entrepreneurship.
Related to entrepreneurship is sales. In my opinion, we need to be teaching sales to every child at an early age. Being able to “sell” an idea (again related to storytelling) has been a critical skill in my career, and it is a competency that many people simply never learned.
The lemonade stand has been a classic, though somewhat meager, lesson in sales from past generations, where a child sits on a street corner and tries to sell homemade lemonade for $0.50 to people passing by. I’d suggest we step the game up and take a more active approach in gamifying sales, and maybe having the classroom create a Kickstarter, Indiegogo or GoFundMe campaign. The experience of creating a product or service and successfully selling it will create an indelible memory and give students the tools to change the world.
Module 12: Language
I just returned from a week in China meeting with parents whose focus on kids’ education is extraordinary. One of the areas I found fascinating is how some of the most advanced parents are teaching their kids new languages: through games. On the tablet, the kids are allowed to play games, but only in French. A child’s desire to win fully engages them and drives their learning rapidly.
Beyond games, there’s virtual reality. We know that full immersion is what it takes to become fluent (at least later in life). A semester abroad in France or Italy, and you’ve got a great handle on the language and the culture. But what about for an 8-year-old?
Imagine a module where for an hour each day, the children spend their time walking around Italy in a VR world, hanging out with AI-driven game characters who teach them, engage them, and share the culture and the language in the most personalized and compelling fashion possible.
Exponential Technologies for Our Classrooms
If you’ve attended Abundance 360 or Singularity University, or followed my blogs, you’ll probably agree with me that the way our children will learn is going to fundamentally transform over the next decade.
Here’s an overview of the top five technologies that will reshape the future of education:
Tech 1: Virtual Reality (VR) can make learning truly immersive. Research has shown that we remember 20% of what we hear, 30% of what we see, and up to 90% of what we do or simulate. Virtual reality yields the latter scenario impeccably. VR enables students to simulate flying through the bloodstream while learning about different cells they encounter, or travel to Mars to inspect the surface for life. To make this a reality, Google Cardboard just launched its Pioneer Expeditions product. Under this program, thousands of schools around the world have gotten a kit containing everything a teacher needs to take his or her class on a virtual trip. While data on VR use in K-12 schools and colleges have yet to be gathered, the steady growth of the market is reflected in the surge of companies (including zSpace, Alchemy VR and Immersive VR Education) solely dedicated to providing schools with packaged education curriculum and content.
Add to VR a related technology called augmented reality (AR), and experiential education really comes alive. Imagine wearing an AR headset that is able to superimpose educational lessons on top of real-world experiences. Interested in botany? As you walk through a garden, the AR headset superimposes the name and details of every plant you see.
Tech 2: 3D Printing is allowing students to bring their ideas to life. Never mind the computer on every desktop (or a tablet for every student), that’s a given. In the near future, teachers and students will want or have a 3D printer on the desk to help them learn core science, technology, engineering and mathematics (STEM) principles. Bre Pettis, of MakerBot Industries, in a grand but practical vision, sees a 3D printer on every school desk in America. “Imagine if you had a 3D printer instead of a LEGO set when you were a kid; what would life be like now?” asks Mr. Pettis. You could print your own mini-figures, your own blocks, and you could iterate on new designs as quickly as your imagination would allow. MakerBots are now in over 5,000 K-12 schools across the United States.
Taking this one step further, you could imagine having a 3D file for most entries in Wikipedia, allowing you to print out and study an object you can only read about or visualize in VR.
Tech 3: Sensors & Networks. An explosion of sensors and networks are going to connect everyone at gigabit speeds, making access to rich video available at all times. At the same time, sensors continue to miniaturize and reduce in power, becoming embedded in everything. One benefit will be the connection of sensor data with machine learning and AI (below), such that knowledge of a child’s attention drifting, or confusion, can be easily measured and communicated. The result would be a representation of the information through an alternate modality or at a different speed.
Tech 4: Machine Learning is making learning adaptive and personalized. No two students are identical – they have different modes of learning (by reading, seeing, hearing, doing), come from different educational backgrounds, and have different intellectual capabilities and attention spans. Advances in machine learning and the surging adaptive learning movement are seeking to solve this problem. Companies like Knewton and Dreambox have over 15 million students on their respective adaptive learning platforms. Soon, every education application will be adaptive, learning how to personalize the lesson for a specific student. There will be adaptive quizzing apps, flashcard apps, textbook apps, simulation apps and many more.
Tech 5: Artificial Intelligence or “An AI Teaching Companion.”
Neil Stephenson’s book The Diamond Age presents a fascinating piece of educational technology called “A Young Lady’s Illustrated Primer.”
As described by Beat Schwendimann, “The primer is an interactive book that can answer a learner’s questions (spoken in natural language), teach through allegories that incorporate elements of the learner’s environment, and presents contextual just-in-time information.
“The primer includes sensors that monitor the learner’s actions and provide feedback. The learner is in a cognitive apprenticeship with the book: The primer models a certain skill (through allegorical fairy tale characters), which the learner then imitates in real life.
“The primer follows a learning progression with increasingly more complex tasks. The educational goals of the primer are humanist: To support the learner to become a strong and independently thinking person.”
The primer, an individualized AI teaching companion is the result of technological convergence and is beautifully described by YouTuber CGP Grey in his video: Digital Aristotle: Thoughts on the Future of Education.
Your AI companion will have unlimited access to information on the cloud and will deliver it at the optimal speed to each student in an engaging, fun way. This AI will demonetize and democratize education, be available to everyone for free (just like Google), and offering the best education to the wealthiest and poorest children on the planet equally.
This AI companion is not a tutor who spouts facts, figures and answers, but a player on the side of the student, there to help him or her learn, and in so doing, learn how to learn better. The AI is always alert, watching for signs of frustration and boredom that may precede quitting, for signs of curiosity or interest that tend to indicate active exploration, and for signs of enjoyment and mastery, which might indicate a successful learning experience.
Ultimately, we’re heading towards a vastly more educated world. We are truly living during the most exciting time to be alive.
Mindsets for the 21st Century
Finally, it’s important for me to discuss mindsets. How we think about the future colors how we learn and what we do. I’ve written extensively about the importance of an abundance and exponential mindset for entrepreneurs and CEOs. I also think that attention to mindset in our elementary schools, when a child is shaping the mental “operating system” for the rest of their life, is even more important.
As such, I would recommend that a school adopt a set of principles that teach and promote a number of mindsets in the fabric of their programs.
Many “mindsets” are important to promote. Here are a couple to consider:
Nurturing Optimism & An Abundance Mindset:
We live in a competitive world, and kids experience a significant amount of pressure to perform. When they fall short, they feel deflated. We all fail at times – that’s part of life. If we want to raise “can-do” kids who can work through failure and come out stronger for it, it’s wise to nurture optimism. Optimistic kids are more willing to take healthy risks, are better problem-solvers and experience positive relationships. You can nurture optimism in your school by starting each day by focusing on gratitude (what each child is grateful for), or a “positive focus” in which each student takes 30 seconds to talk about what they are most excited about, or what recent event was positively impactful to them. (NOTE: I start every meeting inside my PHD Ventures team with a positive focus.)
Finally, helping students understand (through data and graphs) that the world is in fact getting better (see my first book: Abundance: The Future is Better Than You Think) will help them counter the continuous flow of negative news flowing through our news media.
When kids feel confident in their abilities and excited about the world, they are willing to work harder and be more creative.
Tolerance for Failure:
Tolerating failure is a difficult lesson to learn and a difficult lesson to teach. But it is critically important to succeeding in life.
Astro Teller, who runs Google’s innovation branch “X,” talks a lot about encouraging failure. At X, they regularly try to “kill” their ideas. If they are successful in killing an idea, and thus “failing,” they save lots of time, money and resources. The ideas they can’t kill survive and develop into billion-dollar businesses. The key is that each time an idea is killed, Astro rewards the team – literally, with cash bonuses. Their failure is celebrated and they become a hero.
This should be reproduced in the classroom: kids should try to be critical of their best ideas (learn critical thinking), then they should be celebrated for ‘successfully failing’ – perhaps with cake, balloons, confetti and lots of Silly String.
Lately, my life has been completely packed with speeches, meetings, and in-depth, often lengthy, conversations. Plus ongoing research and writing, of course. It all culminated Thursday afternoon at the beginning of a business meeting with the leadership team from a firm that will become a significant new business partner. At the very beginning of the meeting, the head of the firm leaned over to me and asked, “What’s on the top of your mind? What are you thinking about?” The previous night we had a small group of about 15 people in my living room after dinner, and the question was similar, “What keeps you up at night?”
It has become an emotional question for me, because the answer does not come easily, is complex, and can be more than a little unsettling. It is, however, evolving out of the research and writing I’m doing on my new book, The Age of Transformation. Whether audiences and readers agree with my answer or not, it is not a feel-good message, which is somewhat frustrating because I’m the biggest long-term optimist in the room. But I acknowledge that what I am talking about suggests that the ride between today and the long-term happy ending is going to be more than a bit bumpy.
This week’s letter is going to be a passionate summary of my answer. In form, it will be something like a conversation between you and me, sitting in your living room or mine, or in a restaurant, maybe sipping an adult beverage, thinking through the future together, and wondering at how the world is transforming in front of our eyes.
In part, the impetus for this letter was a video I did with Patrick Cox last week, one in a four-part series that Patrick is doing called “Riding the Gray Tsunami.” We had a candid conversation about the future that lasted an hour, though our outstanding moderator and editor Jonathan Roth, one of our team members, will likely edit it to about 30 minutes. Patrick’s other guests will be Dr. Mike Roizen, the chief wellness officer at the Cleveland Clinic; Aubrey de Grey, the chief science officer of SENS Research Foundation and one of the true experts on longevity science; and finally, our friend Jim Mellon, self-made British billionaire and avid biotech investor. You can sign up to participate here. You really don’t want to miss this. Now let’s jump to the letter.
In the interest of brevity, let’s take it is a given that we’re going to see massive technological change in the next 20 years. In fact, we will see more change – and improvement – in the next 20 years than we’ve seen in the last hundred. Think where we were 100 years ago and how much has changed since then. That much and more is going to happen in the next two decades. Global society really is going to transform that fast.
Let’s start with some good news. In 1820 some 94% of the world’s population lived in extreme poverty. By 1990 the figure was 35%, and in 2015 it was just 9.6%. Forty percent of those who remain impoverished live in just two countries, Nigeria and India, both of which are growing rapidly and will see their extreme poverty significantly decrease in the next 20 years.
There is research to show that, on a global basis, the poor are getting richer faster than any other group. However, if you look around the US or Europe, that is not the conclusion you come to. But Africa or Asia? Absolutely. Let’s be clear: The Industrial Age and free-market capitalism, for all of its bumps and warts, has lifted more people out of poverty and extended more lives than has any other single development. The collapse of communism has been a great boon to humanity (even if it is still talked about favorably in Western universities).
Because of where the emerging-market economies are in the development cycle, they have the potential for vast, rapid improvement in the lives of their people. But most of my readers do not live in the emerging markets. We live in the developed markets; and here, some of the outcomes of the Age of Transformation will not be so comfortable. Let’s start with this chart (hat tip, Downtown Josh Brown).
Obviously, the rig count in US oilfields is rising rapidly – no surprise there. But distressingly, the number of oilfield workers is continuing to fall. How can this be?
There is an answer to that conundrum in the long article that is the source of this chart and others I’ll use later. There is a new robotic machine called an Iron Roughneck that reduces the human labor required to connect pipe from a crew of 20 down to a crew of five. And those jobs were quite high-paying. Here’s a picture of this new robotic roughneck. Fifteen workers per site at well over $100,000 a year each? Does that machine look like it cost more than a few million? I bet it amortizes pretty quickly, and that’s why it is being rapidly adopted.
Now look back at the chart. The amazing thing is that this transformation happened ; it didn’t take a generation or even half a generation. You were an oilfield worker with what you thought was potentially a lifetime of steady, well-paying – if dangerous, nasty, and dirty – work. And then BOOM! The jobs just simply disappeared. Your on-the-job experience doesn’t translate to any other industries very easily, and now you and your family are on the skids.
I could actually spend this entire letter talking about the amazing transformation of the oilfield. Oil production is now a technology business. Computers and artificial intelligence are used in abundance in the oilfield. Future wells are going to be a magnitude more productive and less expensive. There are oilfield operators here in Dallas running around with pro formas, raising money, talking about how they can do very well at $40 and even $30 per barrel. And with oil at $54 and looking as though it could well go to $60, they are raising money and punching holes. Just with fewer workers.
From the report on the Iron Roughneck we get the following alarming quote. (Note that the report is full of links to academic research. While I don’t like the author’s conclusions, his work is at least well researched).
A landmark 2017 study [dismal reading – John] even looked at the impact of just industrial robots on jobs from 1993 to 2007 and found that every new robot replaced around 5.6 workers, and every additional robot per 1,000 workers reduced the percentage of the total population employed by 0.34% and also reduced wages by 0.5%. During that 14-year period of time, the number of industrial robots quadrupled and between 360,000 and 670,000 jobs were erased. And as the authors [Daron Acemoglu and Pascual Restrepo] noted, “Interestingly, and perhaps surprisingly, we do not find positive and offsetting employment gains in any occupation or education groups.” In other words, the jobs were not replaced with new jobs.
It’s expected that our industrial robot workforce will quadruple again by 2025 [more troubling MIT research – John] to 7 robots per 1,000 workers. (In Toledo and Detroit it’s already 9 robots per 1,000 workers.) Using Acemoglu’s and Restropo’s findings, that translates to a loss of up to 3.4 million jobs by 2025, alongside depressed wage growth of up to 2.6%, and a drop in the employment-to-population ratio of up to 1.76 percentage points. Remember, we’re talking about industrial robots only, not all robots, and not any software, especially not AI. So what we can expect from all technology combined is undoubtedly larger than the above estimates.
Automation has been happening right under everyone’s noses, but people are only beginning to really talk about the potential future dangers of automation reducing the incomes of large percentages of the population. In the US, the most-cited estimate is the loss of half of all existing jobs by the early 2030s.
You can find people who estimate that technology will eliminate as many as two billion jobs, while also creating a large number of jobs – but nowhere near as fast. I don’t buy those extreme estimates, as I think they amount to sensationalism, but if you want to predict 30 to 40 million jobs lost in the US by the middle of the 2030s (that’s ), I’m not going to argue with you. How many jobs will be created? We’ll get to that in a minute.
People frequently talk about the loss of trucking and taxi jobs that will result from the automation of driving. RethinkX, in a 77-page report, concludes that 90% of all driving in the US will be TaaS (transportation as a service) by 2030, although that will utilize only 60% of the cars. The good news is that the average family will save $5,600 per year in transportation costs, keeping an extra $1 trillion per year in Americans’ pockets. Think of all the time that will be freed for activities other than driving, not to mention the traffic jams that will be reduced. The authors believe that freeing time now spent commuting to work, plus faster transport times, will lead to an increase in GDP of between $500 million to as much as $2.5 trillion. Public sector budgets will benefit because highway infrastructure costs will fall, and vast amounts of land will be freed from parking lots and publicly owned right-of-way properties next to highways. Of course, governments will lose as much as $50 billion in gasoline taxes as we shift from internal combustion engines to electric and other alternative forms of power systems.
The really bad news is that a lot of people will lose their incomes.
The report projects that the adoption of TaaS will come about in typical technological adoption fashion: slowly and then seemingly all at once. The authors talk about the end of individual car ownership. Why would you own a car if it was far cheaper and more convenient just to pick one up via an app on your phone? Not owning a vehicle frees a lot of garage and parking space and might even eliminate the hassle of picking up your kids and getting them to and from their various activities. Of course, the system will work much more effectively in urban and suburban areas than in the rural world.
And it is not just the six million taxi and truck driver jobs that are threatened. Automated driving will save some 30,000 lives per year just in the US, which is something to be applauded. But it will also dramatically decrease the number of people going to emergency rooms from automobile wrecks, reducing the need for healthcare workers. Since cars won’t be in wrecks, the number of people required to repair them will be radically reduced. There are 228,000 auto repair shops in the country, employing some 647,000 workers (at a minimum – data from BLS). When a new car will last for one million miles and have fewer than 30 moving parts, those auto repair people are going to be like the Maytag repairman in the commercials of my youth: very lonely and increasingly unemployed.
If driving is TaaS, then automobile dealerships are in trouble, as are most car salesmen and the 66,000 people who work in automotive parts and accessories stores. What about auto insurance salesmen? And all the gas stations that will not be needed? (When an automated car gets low on electricity, it will simply pull into a spot and replug – automatically, of course, aided by robotics.)
The US auto industry employs 1.25 million people directly and another 7.25 million indirectly. Not all driving jobs will be lost, but the authors estimate that around 5 million will be, with a reduction in national income of $200 billion.
And if we need fewer cars? That shift would put a lot of automotive manufacturing companies and their workers under severe strain. I’m not certain how the authors arrived at the number, but they estimate new-vehicle annual unit sales will drop by 70% by 2030, to around 5.6 million vehicles versus the 18 million that will be sold in 2020. Ugh. If we actually do see wholesale conversion to electric vehicles, US oil demand for passenger road transport could drop by 90% or more. Oil production companies may need to figure out how to make life work at $25 per barrel, if that’s the case.
Personally, I think the report is a little over the top. (Well, maybe more than a little.) But if they stretch those projection figures to 2035 or 2040? Totally in the ballpark. And frankly, as I will note in a few paragraphs, whether it’s 2030, 2035, or 2040, the change will seem like it came overnight and totally out of left field – especially for the workers who no longer have work.
I was talking with my friend Dr. Ray Takigiku, chief executive and chief scientist of Bexion Pharmaceuticals. The company is now 15 months into a phase I trial to determine the safety of a drug called BXQ-350, which is basically a full-on silver bullet for mass-tumor cancers. It has so far been a small trial in four medical research universities, with a limited but growing number of patients who have pancreatic cancer and brain tumors. The results have been very promising. Ray told me about one patient at the University of New Mexico who has a very rare form of cancer and who was given the drug. This is a cancer for which there is no treatment – it’s basically a death sentence. It occurs in adults but more frequently in children. Ray was initially concerned about treating this patient, as the study is about safety and you really don’t want to have any issues associated with a safety trial. But the patient’s doctor talked him into proceeding, and they began to administer the drug. It hasn’t been very long, but the patient is improving, and the cancer is regressing. He had lost partial use of his right side but is now walking and using that side again.
Because it’s a phase I trial, we don’t really have much information about how effective the drug is, apart from anecdotes; and distressingly, the researchers must sometimes stop administering the drug because that’s part of the required protocol. The rules simply want to make me pull my hair out.
In the US, one million people per year get cancer, and half a million die. Those are ugly statistics, but they could change drastically within less than 10 years. Cancer could become a nuisance rather than a threat to life. I lose more and more friends every year to cancer. We all do. I will be so glad if that stops. So will you.
Full disclosure: I was a first-round investor in Bexion, and so I have a strong home-field bias in wanting BXQ-350 to succeed, but the reality is that its success will be extraordinarily good for humanity. And frankly, one of the main risks to my investment is not that the drug won’t actually work, but that any of several other companies that Patrick Cox and I are looking at will actually come up with a drug that is cheaper, better, and faster. Or maybe, as in treating AIDS, you end up with a cocktail of drugs to fight cancer.
One way or another, cancer is going to go the way of measles and polio. You’ll be diagnosed by means of a simple blood test that will be part of your annual medical checkup, and you’ll be informed if you have cancer. Next you will undergo further tests to determine what type. And then, whatever the therapy is, it is likely that you will simply go to your doctor’s office for regular treatments. In the case of Bexion’s drug, treatment will (hopefully) amount to a few months or less of three visits per week, no side effects, and your cancer goes away. That is the extrapolation from mouse studies. We’ll know more after phase II studies are underway sometime next year. Since it is now public information, I can mention that John McCain will be given access to this drug at the University of New Mexico Comprehensive Cancer Center. Randomly, McCain has one of the types of cancer that the phase 1 trial has focused on. And he also actually qualifies for the trial (which is not easy to do). With all Americans, I wish him the best.
But let’s think for a minute about the impact of the success of a drug of this type beyond the many lives that will be saved and the significant reduction of pain and suffering. I couldn’t determine the number of healthcare workers specifically associated with the treatment of cancer, but it has to be in the hundreds of thousands, and they have relatively high-paying jobs. Then there are all the hospital beds filled by cancer patients – easily many tens of thousands. Plus all the ancillary workers that are associated with the care and welfare of cancer patients. The good news is that with the rising need for healthcare workers, those workers will be able to relatively quickly moved to an associated field. And let’s not forget the estimate Kyle Bass gave me, that at least $500 billion of market cap in big Pharma will be destroyed by a cure for cancer.
So there are just two examples of major disruptions to employment that will be caused by near-future technological change. We haven’t even gotten into the brick-and-mortar retail jobs that online sales firms like Amazon are taking away. And warehouse workers? The list could go on and on of whole job classifications that are endangered species. These changes are going to disrupt our lives and the social cohesion of our country. And of course these shifts are coming not just in the US, but in the entire developed world. And even technology centers in the developing world are going to find themselves at risk of employment dislocations.
Just so that I don’t appear to be a total Gloomy Gus, let me quickly note that the very technologies that are destroying job are also going to result in tens of millions of new and in many cases better jobs. Many of them will be high-paying, more life-fulfilling, and far less dangerous than the occupations they replace. I’ll write a letter in the near future in which I’ll talk about where those tens of millions of new jobs will hopefully come from.
The glib answer to the question, “Where will the jobs come from?” has always been “I don’t know, but they will.” That is what has always happened in the past. We went from 80% of laborers working on the farm in the 1800s at barely subsistence-level incomes to 2% producing far more food today. As these farm workers became redundant, they moved to where the jobs were. And with a lot of ups and downs, we managed over time to find jobs for nearly everyone. But that transition took place over 200+ years – 10 generations. There was time for people to adjust and for markets to adapt. Even when whole industries appeared and then disappeared again, it happened over generations. Everybody bemoans the loss of US manufacturing jobs, but few realize that we are producing almost as much as we ever have – just with fewer people. And this trend will continue. More production, with fewer workers. Just like we see in the oilfields.
The transformations I am talking about are going to happen in one half a generation, or at the most a full generation. That is not much time for adjustment, especially for a country like the United States where 69% of families have less than $1,000 in savings. (I have seen the figure quoted that 47% have less than $400.) That is not enough to deal with the loss of your job.
The classic Republican answer to this problem is that we need to unleash the entrepreneurial tide in the United States that has been dammed up by bureaucracy and excessive taxation. And there is a point to that. But for whatever reason – and this is a topic for another letter (and it’s one I have addressed in the past) – for the past five or six years the country has had more firms close than be created, and for the first time in our history.
Let me emphasize that ultimately we’ll arrive at a very happy ending. Our heroes and heroines will walk off into the sunset, holding hands and living happily ever after. Literally living happily ever after, because of the new life-extension technologies that are just around the corner in a world of amazing abundance and ever-cheaper products, with even greater lifestyles than today’s. Flying to the Moon and Mars…
The problem is not the happy ending. The problem is the transition, which is going to be bumpy and frustrating and potentially divisive. I’m going to show you three graphs from Pew Research. Analysts have been conducting studies (see people-press.org/interactives/
political-polarization-1994- 2017/ and pewresearch.org/fact-tank/ 2017/10/05/takeaways-on- americans-growing-partisan- divide-over-political-values/) since 1994, trying to discern political polarization. These three charts look at the years 1994, 2004, and 2017. Even as late as 2004, notice the broad crossover between the median Democrat and median Republican. And then notice how wide the divide is today.
Not only are the median positions of both parties further apart, but both parties have also shifted farther to their respective extremes in the last 13 years. The middle ground is much smaller, and to my eye it looks like the Democratic group is somewhat bigger than the Republican. You can see the same thing in the breakdown of the vote by states and counties; but since political commentary is not my genre, I’m going to avoid going any further down that rabbit hole.
But I will say that the internet, social media, and the media we consume on TV have allowed us to live in echo chambers where we are not really hearing much from the other side. We talk to people who think like we do and who tend to confirm that we are correct in our beliefs. That constant cycle of reinforcement makes our positions even more hardline, to the point where we trivialize or disparage the other side. It has seemingly become acceptable for an American congressman to say that he doesn’t feel sorry for those killed in the mass Las Vegas shooting because they were likely Trump supporters and against gun control. And for white hate groups to blatantly and publicly espouse racist positions. Antifa groups can call for the random killing of white people, simply for being white. And fewer than 30% of Millennials think that democracy is clearly the superior system of government.
And that is where we are today. Where are we going to be when unemployment is well over 12% and rising to 15%, the government is routinely running multitrillion-dollar budget deficits, state and local pensions are defaulting, and taxes are high and still rising?
And all this is going to happen at a time when wealth and income disparity are going to rising even faster than they are today. It’s all there in the data if you take the time to look. I am working hard to document not just the technological changes but the social, demographic, and political changes, along with the economic realities we will face in the book I’m currently writing. My greatest challenge will be to keep it under 300 pages!
And so, yes, when people ask what is in my worry closet, it is the fragmentation of society. As a country, we are going to have to begin to think the unthinkable. We really don’t know how to accurately measure GDP or inflation, and we certainly don’t have any way to statistically measure the improvements in lifestyle over the years. And we will need those tools. As conservatives and Republicans, we are going to have to think about something like universal basic employment, as opposed to universal basic income. Good work and participating in society give us meaning in life. Income just gives us a way to scrape by, but not personal life satisfaction or meaning, which is why we have an epidemic of opioid deaths, suicides, and rising deaths from alcoholism in the United States among white unemployed workers between 45 and 54. They have lost meaning and hope in their lives.
The calls for a guaranteed basic income (like Mark Zuckerberg’s) are just beginning, but that is going to become a major political theme in our future. Like King Canute, we cannot stop the tides – but perhaps we could get creative and channel that tide. What do we think of shorter work weeks? Just as Roosevelt put men to work during the Depression, maybe we need to think about finding jobs around our communities that need to be done. Guaranteed basic employment. Mull that over….
Yes, that offends every Hayekian neuron in my brain, but in a world of an unimaginable and unmanageable future, we are going to have start thinking the unthinkable.
Voters are going to want politicians to solve their problems. Politicians can’t really solve the problems we already have, let alone the problems of the future, so I expect we are going to see shifts from one political extreme to the other.
Let’s be clear, these problems are not all going to show up next year, and most won’t even start to be understood until the early 2020s. But they’re coming, and we need to begin to plan for them now, for our country, for our own and our families’ lives, and for our portfolios. I look forward to being part of your journey and hopefully helping you to plan.