“Today we stand at the beginning of the autonomous robot era. Compared to the automobile age we are in the 1890s, waiting for the first Model T.”
– Mark Mills, Technology Pundit
On February 11, President Donald Trump signed an executive order that the mainstream media all but ignored.
Yet it may be the most important executive order that the CEO-turned-president has ever signed.
Trump’s “American AI Initiative” instructs federal agencies to prioritize artificial intelligence (AI) research and training.
This follows last year’s creation of the Joint Artificial Intelligence Center (JAIC) by the Department of Defense – a similar and even more focused effort.
Together, these initiatives signal one thing…
The development of AI has become a top priority for the federal government.
This means big juicy AI contracts are in the future for many U.S. technology firms.
It’s also why I believe AI represents the biggest opportunity for savvy investors since the internet.
Artificial Intelligence: Threat or Opportunity?
AI has an image problem.
According to a recent Gallup poll, most economists agree that AI represents the single biggest threat to future economic growth in the United States.
Their implicit assumption?
That AI is different from all previous technologies.
They believe that more than any other technological development in history…
AI will eliminate the need for human labor and put vast swaths of American workers on the streets.
Others worry about an ominous AI superintelligence that threatens humanity’s entire existence.
As AI entrepreneur Elon Musk dramatically puts it, that makes AI “more dangerous than nukes.”
What a bunch of bunk!
Instead of spelling the end of humanity…
AI will give the global economy a boost in productivity last seen at the advent of the Industrial Revolution.
It also means that more fortunes could be made – and lost – than in all previous technology revolutions combined.
Let me explain…
Fearing technology and blaming it for unemployment is standard fare for politicians.
As far back as 1961, President Kennedy created an “Office of Manpower, Automation and Training.”
To address “the major domestic challenge, really, of the ’60s: to maintain full employment at a time when automation, of course, is replacing men.”
(By today’s standards, Kennedy’s concern about automation seems almost quaint.)
I take the opposite view.
I believe that technological innovation is the closest thing to an economic free lunch.
After all, it’s technology that has made everything from food to fuel available across the globe.
And it did so by improving the economy’s productivity. (Defined as the reduction of labor hours per unit of production or service.)
As Nobel Prize-winning economist Paul Krugman observed, “Productivity isn’t everything, but in the long run it is almost everything.”
Economists of all political stripes agree on the benefits of improved productivity.
Consider the implications of even a small boost in the productivity of the U.S economy…
Tech pundit Mark Mills has calculated that only a small uptick in productivity – from the “new normal” of 2% to, say, a 3.5% annual growth rate by 2028 – would generate an extra $3.6 trillion in economic wealth.
That’s roughly the GDP equivalent of an additional California and Florida today.
Why the Tech Pessimists Are Wrong
Mills argues that AI will launch this new era of productivity expansion in America.
This will, however, come at the cost of “creative destruction.”
Yes, AI will reduce the labor hours needed to perform specific tasks…
After all, that’s the very definition of increased productivity.
It is easy to predict which groups will lose jobs from these changes.
It’s far harder to predict what kinds of new jobs – and how many – will appear.
We do know that projections about the need for labor tend to be overly pessimistic.
That’s because the economy always adjusts.
Farming at one time accounted for 40% of employment in the U.S. Today it accounts for just 2%.
The arrival of automatic washing machines in 1930…
Wang word processors in 1976…
And computer spreadsheets in 1979 each put certain types of employees out of work.
Yet despite all the technological changes over the past 130 years…
The U.S. unemployment rate has hovered around 5%.
There will be plenty of jobs in the world of AI…
But they will be jobs we cannot yet imagine.
Making Your Fortune in AI
As I’ve noted, I believe the rise of AI represents the greatest investment opportunity since the internet.
In fact, the internet offers a blueprint for how investment AI will unfold.
Much like the internet, AI will evolve far beyond its initial military applications.
And like the internet, AI will transform every aspect of home, work and play.
Finally, the winners of the AI revolution will generate fortunes that will rival those of Jeff Bezos and Bill Gates today.
It’s a ride you don’t want to miss.