I recently joked that, because of AI, everyone now sends you a 50-page PDF for review. Of course, what we all do next is just ask AI to summarize it and help prepare a response. So, the net effect is AI talking to AI.

We're all becoming a kind of intermediary because the volume of information is simply too great for any human to reasonably process. In many ways, this can feel overwhelming. It also makes me feel like it's becoming harder to maintain a long attention span.

But this appears to be where the world is heading. Eventually, we are going to have what is known as Artificial General Intelligence (AGI), and that is going to have a profound impact on our lives.

Venture capitalist Albert Wenger has been spending a lot of time thinking about what an AGI-level economy might look like, and he recently published a post where he modeled some of the possible scenarios.

I will give you the spoiler here: His intuition is that we're going to need to create an economy that combines competition and redistribution (also referred to as a Negative Income Tax, which provides people with a basic income).

Because without competition, productivity gains will be captured as rent, rather than resulting in lower prices. And without redistribution, we are likely to see an untenable increase in inequality.

If you're interested in this topic, I would encourage you to check out his post.

Cover photo by Alex Knight on Unsplash

One traditional metric for measuring the performance of a company is revenue per employee. And in a knowledge-based economy, this makes a lot of sense. Human capital is often the biggest expense. But as we enter the age of AI, this is now being called into question.

Sara Menker has, for example, proposed a new metric: revenue per MWh. (See above comparing Meta, Alphabet, and Microsoft.) This is meant to reflect the fact that, as AI infrastructure scales, it is likely that operating costs in the future will be dominated by electricity consumption, rather than employee count.

Naturally, this should make you wonder about a few things, namely: How will we manage the inequality that might (or will) arise from the decoupling of revenues from employees? And how are we going to sustainability supply this rapidly growing need for more and more electricity?

Albert Wenger argues that the comparable metric for nations will be GDP per GWh. This means that, to win, you're going to want cheap electricity. And as I understand it, the cheapest sources are wind, solar, and hydropower. This bodes well for Canada given that we dominate in the latter.

Cover photo by Thomas Reaubourg on Unsplash

Here's an interesting presentation by Albert Wenger, who is a partner at Union Square Ventures. He starts by showing a logarithmic chart comparing per capita energy consumption and GDP per capita. Then, by way of a clear empty area in the chart's data points, he makes the argument that there's no such thing as a wealthy, low-energy nation. If you're a wealthy country, you consume a lot of energy. That's just how it works. He then goes through a number of historical energy breakthroughs, landing on the point that, today, we are in need of much more energy. In other words, we need another energy breakthrough. We need it because we're still burning fossil fuels and putting too much carbon into the atmosphere, and because we have really big energy needs: everything from data centers to the full electrification of our homes, buildings, and cars. One piece of good news is that we are seeing exponential growth in solar energy. Today, our global install base is still relatively small, but the thing about exponential growth is that it can creep up on you fast.

It's an interesting presentation. And if you'd prefer to read his talk instead, which is/was my preference, you can do that here.