What is the Economic Singularity?
An Economic Singularity is an economic situation where one single entity, or more likely a series of related , allied entities who are likely to cross-own their competitors, control virtually all economic activities. The local lemonade stand or the horse trader in the Andes mountains might be excluded, but their overall percentage in the grand picture would be too tiny to matter. Virtually all economic activity worth mentioning would be controlled by a single entity or a group of related entities. - Kulm
People like Peter Diamandis are arguing that the future is a world of abundance and everyone will be able to live in material wealth with no shortages. However, in reality, not everyone will be able to enjoy the world of abundance and quite a lot of people will be left behind, like the tenement dwellers in 19th century New York.
Even with all the tech gadgets and fancy apps of today to make humans' lives more efficient, one still needs to live somewhere. Not to mention somewhere affordable as we continue to see rent and property tax going up significantly. Just ask anyone that lives in San Francisco.
A great example of change is shown during a gentrification process. Wealthier individuals begin to move into neighborhoods directly impacting prices. The individuals who own their house free and clear, tend to sell and move away to a cheaper area because they can't afford to pay the higher property tax and other associated bills.
Advances in technology have been replacing jobs with more efficient means and new jobs since the first wheel was created. However, a report (PDF) by Oxford researchers estimates almost half of US jobs could be lost.
"47% of the US workforce is at high risk of automation "
They foresee the majority of low-income and low-skill jobs could be mostly automated. This isn't to say that all jobs are safe. This interactive chart shows the automation potential of a multitude of jobs. From pharmacists to doctors to CEOs, there is an automation possibility.
LOOKING FORWARD
Most of the economic gains are going to be concentrated among those who actually create economic value, such as the Web 2.0 princes or others like Elon Musk who is able to capitalize from new technologies.
Entrepreneurship will become incredibly difficult except for the few who can create something of value for the major corporations. Demis Hassabis is a prime example. He created the start-up DeepMind which was bought by Google for around $500 million in 2014. AlphaGo, the artificially intelligent Go player that knocked off a top player in the world (a feat thought not possible for at least another decade), is one of the creations from DeepMind.
Virtually all startups worth their salt will be bought up by the ‘big boys’ , who have lots of cash, rather than challenging them.
Such is the reality of the Economic Singularity.
The majority of people will be incapable to fulfill the needs of advancing corporations capabilities and will be marginalized. By the weight of numbers, they might try to upset the status quo through elections. However, their demagogues will take advantage of them by furthering their own economic position. The inability to prosper for the majority will continue to grow and the gap will widen.
Furthermore, the major wealth and tech-drivers will probably separate themselves from nation states and become sovereign similar to the Holy See at Vatican or Venice up to 1797.
Venice maintained its independence and its merchant princes were able to live better than many kings of Europe. This is because it was able to defend itself from invasion through technological superiority. However, Napoleon showed up in 1797 and they were no longer able to defend themselves due to their inferiority to his military's capabilities.
Apple and Google are already both larger than a number of countries from a GDP perspective (not to mention technologically superior). With a lot of uncertainty in today's economic climate, it is not farfetched to think massive organizations could create new countries to ensure their wealth preservation, avoid wars, dodge certain laws, etc.
WALL-E BECOMES REALITY
Individuals smart and lucky enough to have obtained a job will be grateful to be there and will be completely loyal to the company. They will not do anything ‘rash’ enough to be fired as they will be part of the working minority and upper class.
Life will be terrible for most people during the Economic Singularity. There will be few jobs and several huge companies will own virtually everything and drive the technological advance of the world.
Most of the population will be disenfranchised completely and kept out of all advances for practical reasons. Although, those living in more developed countries will be treated slightly better to keep them from rising up.
The people enjoying the Economic Singularity will also reach the Technological Singularity, advance to space, and kiss goodbye to the Earth. Leaving the remaining inhabitants to a fate somewhat similar to WALL-E, where they are technologically incapable to clean up the mess left by the advanced homo sapiens before them.
ECONOMIC SINGULARITY
The Economic Singularity leaves nothing on the ‘table’, not even crumbs for the masses who are less informed, less wealthy, and less intelligent. A classic winner-take-all Darwinian environment.
As the Economic Singularity arises, the majority of the world will suffer as the risk of starvation and endless stress of job insecurity runs rampant. The 'gig economy' (ie. Uber drivers) will slowly fade away into automation as cheaper entertainment distracts people from their pains of real life.
This is slightly synonymous with how the world worked until 1914. A brief window of prosperity existed after the Great War and the various technological advances thereafter. The necessary existence of a sizable middle class was needed to create and consume all the goods being churned out.
However, the economic conditions no longer necessitate a middle class. Now the question will be how those driving the world towards a Type I Civilization will be able to prevent a crisis like 1914. Which in turn, could stop the whole process before the gap is complete and insurmountable.
HARSH TRUTHS
Most futurists and other tech-watchers are reluctant to say what will probably happen during an Economic Singularity. Most likely because they don't want to upset their following and disrupt the status quo in the general realm of thought of futurism.
Many of them offer half-hearted, unrealistic suggestions about what to do with those who can’t thrive in the Economic Singularity (ie. basic income) as they fully know they will never have to deal with being on the losing end.
Warren Buffet's right hand man, Charlie Munger, knows the reality of the future is bleak. There will no longer be the possibility to find a better life with hard work, similar to how some of the tenement dwellers escaped their confines years ago. In the Economic Singularity, hard work or having a good work ethic will no longer be needed and the only true value will be the ability to create something unique for the mega corporations.
Sadly, the real picture will be similar to what happened in Bengal, India, during 1943 when 7 million Bengali starved to death while the rest of the world barely even noticed.