Who Will Shape the New Economic World Order?
It won't be who you think.
We’re in the midst of a new world order emerging. New technologies like artificial intelligence, blockchain, biological interventions, and quantum computing are shaping what that new world order looks like.
Today’s political class isn’t equipped to ask the right questions about new technologies, much less govern in a world that’s rapidly transforming. At the same time many creators in the AI community warn that we should put the brakes on AI development before it gets out of control.
It’s clear we need policies to shape the role emerging tech plays in creating a new world order. But what types of policies need to be implemented to shape the economy of tomorrow and protect the workers who live in it?
That’s hard to say right now. One thing that is clear is the institutions that shaped our current world order are outdated. And the leaders of those institutions aren’t equipped with the right knowledge and skills to implement the policies we need.
So who’s going to step in to shape the world of tomorrow?
Corporations, CEOs, and investors creating the very platforms that are disrupting the world — Elon Musk, Sam Altman, Amazon, and Peter Thiel It won’t be the government or society at large that creates new institutions that shape our future, it will be Silicon Valley.
The economy of tomorrow is taking shape before our very eyes. As it does, old dysfunctional ways of doing things will be replaced by something new.
This essay is going to look at three areas of the economy are shaping the new world order: the educational system, government, and the private sector. It will argue that the latter — the private sector — will have the greatest impact on how the future emerges as it has the right combination of skills, capital, and incentives to do so.
Education is no longer a viable path of economic social mobility.
The educational system as it currently exists was designed for an industrial economy, not the information one we currently live in.
Think back to your school days. What did you learn?
You studied subjects like math, history, and science and completed assignments based on those subjects. Your assignments probably included homework, quizzes, multiple choice tests, and essays.
You learned how to regurgitate facts and practice tasks so in the future you could be a good employee. This equipped you to follow directions. You learned a job and performed tasks associated with that job, but you didn’t learn how to think critically or solve complex problems.
The current educational system doesn’t teach students any real skills. No one taught you how to calculate compound interest and you might not know how to troubleshoot a computer problem on your own without first calling a helpdesk.
When I was in high school I never learned basic principles of accounting let alone how to manage my personal finances. You probably didn’t either. But if you think about it, every household is a mini business. Why didn’t we learn basic things like budgeting or reading financial statements?
Today’s employers want workers who can perform specific skills and solve problems. They don’t need the type of human automatons that performed mindless manufacturing tasks just a few decades ago.
Unless you’re studying for a degree that’s a direct pipeline to a good employment opportunity — think computer science — colleges are completely divorced from the needs of employers. Your professors can’t advise you how to find a job after you graduate because they have no idea what jobs are available for the fields they’re teaching in.
This shift from needing workers to complete rote tasks to asking them to cultivate skills to solve problems undermines the value proposition of a college degree and education as a path of greater socioeconomic mobility.
With AI as a contender for many white collar jobs, it can now do all the rote, mindless tasks that human workers have been trained to do up until this point.
What’s the point of going into debt to finance a degree that leaves you without the skills you need to find gainful employment afterward?
For the educational system to develop the workforce of tomorrow, it has to be reformed. But you’ll be hard-pressed to find an administrator who is willing to take the plunge to do just that.
The government can’t be relied on to support displaced workers.
Workers are going to be displaced as new technologies come online. Going back to school won’t be an option this time around. There’s going to be an overwhelming desire from the public for the government to step in and do something.
The government is hamstrung. Even if it’s best suited to support its citizens it won’t be able to for much longer.
Government revenue is drying up
Revenue that’s generated to support public benefits programs comes from taxes. These taxes are levied on earned income or corporations. As people lose incomes and corporations off shore their finances, there won’t be anything left to support an economically destitute population.
What happens when a country’s citizens lose their jobs to AI and are no longer earning an income? Or better yet, what happens when workers demand being paid in decentralized currencies — like bitcoin — making it difficult for governments to even levy taxes at all?
Tax collection is one of the key functions of government. Historically, it collected taxes to provide collective defense and invest in public projects like building new bridges and roads. Over the last century, government expanded by providing employment opportunities and redistributing taxes in the form of public benefits.
As incomes dwindle, so too, do taxes and thus the raison d’etre of government. At the same time war is increasingly being fought in cyberspace while soon-to-be-displaced knowledge workers are working remotely.
What role will the government play when the core services it provides are no longer needed?
The government and the political class that runs it is face an existential crisis. But rather than figuring out how to adapt to new technologies like AI and blockchain, they are focused on preserving the status quo.
The government doesn’t have the financial resources to provide financial assistance to the population, nor does it have the political will to implement policies that can shape the trajectory of how new technologies emerge.
Washington isn’t here to help us. The economy of tomorrow is going to emerge on an ad hoc basis, shaped by the interests of those who have the most to gain from it — the tech entrepreneurs building it.
Private sector tech firms will be the most important players shaping the future.
Existing institutions that form cornerstones of our economy — the educational system and government institutions — aren’t equipped to help you navigate the new world order that’s emerging. That leaves the private sector — the people who are creating all of these new technologies — to support you.
Big tech is already in the process of replacing college degrees. Companies like Google now offer their own in-house certificates that are designed to help you get a job. Why go to a four-year school when you can educate yourself instead?
The types of certifications being offered signals to workers which skills are in demand. It gives them an alternative pathway to obtain those skills without mortgaging their future on a worthless college degree.
Companies — not the government — have the capital and incentive to invest in free or low-cost workforce training programs. It’s likely this model will expand as new tech platforms emerge. Just like you can become certified to use Salesforce, you’ll be able to get certified to use tools like ChatGPT in the near future too.
As the role of government wanes, something will likely emerge to take its place. It’s possible that instead of relying on a federal government to provide services, corporations and wealthy individuals will step in.
To give you an example, look at healthcare. By 2032 it’s projected the government will spend $1.6 trillion on healthcare-related subsidies. As workers are displaced and income taxes dry up, where is the money going to come from to support these programs?
Private companies will have to start providing direct access to services instead of relying on Medicare and Medicaid. They’re already starting to do that.
Instead of rushing to the doctor next time you have a sore throat, you can pop into your local CVS MinuteClinic. If you have insurance, great. If not, they disclose their prices online — something you’d be hard-pressed to find at a typical doctor’s office.
Even Amazon is getting in on the game. They launched a virtual healthcare platform in 2022 and a $5/month prescription service in 2023.
As more and more companies step in, the need for government programs and administrators will be replaced. Just like feudal lords managed Europe’s economy before capitalism, it’s likely corporations will become technofeudal lords after it.
Final takeaway.
We take industrial capitalism and the institutions that it created for granted. It’s what we’ve always known so it’s what we assume will always be.
It’s becoming increasingly clear that the institutions that supported the old economy are not equipped to usher in a new digital economy characterized by new technologies like AI and blockchain.
Workers at risk of displacement can no longer rely on these institutions to meet their needs. Going back to school or looking to Washington for help isn’t viable anymore.
That means we shouldn’t be asking what types of policies need to be put into place to protect us and our livelihoods. Instead, we should be focusing on who is creating de facto changes on the ground and for what purpose.
It’s starting to become clear that corporations and wealthy individuals will step in to fill the void.
This isn’t new or surprising. At the turn of the 20th century, corporations played a similar role in facilitating the transition to an industrial society. It’s possible history is simply repeating itself.
By knowing this, you can start anticipating what lies ahead. Whatever Google or Elon Musk do, the rest of the economy will follow. If Google certificates replace college diplomas and SpaceX supplants NASA, then that is where future economic opportunities lie.
Recognizing that we’re in the midst of a fundamental reorganization of the economy, government, and society — not just another cyclical economic downturn — you’ll be better prepared to adapt to the new economic world order that emerges in the not-so-distant future.
This makes perfect sense. It's kind of like corporate feudalism, and government will mainly act in the interest of corporations, keeping workers subdued and subservient.
We will still need medical staff, of that I am sure. Still need plumbers, and electrician, sales people, clerks to restock the food aisles, cooks, and even toll people. Will life change, you bet. No one knows exactly in what ways.
What I wonder about is the population moving to different states because of what they offer. No rain tax, good soil to grow things, private sector jobs, training programs for students, apprenticeships, and communities built on or designed on very specific needs and wants. Can’t garden in Texas, try the Carolinas.
Things will get interesting for sure.