Monday, November 11, 2013

A tacit endorsement of inequality? : Reading Tyler Cowen's "Average is Over"

Tyler Cowen really likes chess.

If there’s one key take-away from “Average is Over,” that’s what I know now that I did not know before.    

What I did know before reading is that he is on the opposite side from my own in most political matters.  In fact, in the book he describes himself as a conservative / libertarian somewhere.  I didn’t mark it, but I don’t think I’m making it up.  On the blog that he shares with Alex Tabarrok, they’re not overly partisans and often look at micro issues that don’t easily devolve into “sides” that I ever readily notice.

The thesis of the book is that the middle class is going to hollow out even more, and it will be the people who can use the raw power of computers with the inherent streamlined decision process humans have evolved who will capture most of the value created in the future from the efficiencies that computerization will create.  Basically, most people are in trouble. 

He looks at the future of work by looking at the current state of chess.  If you don’t know much about the chess scene, like me, you will learn a good bit about chess in this book.  Basically, the way chess has been approached by the top players has been radically transformed by the raw computing power available and the programmers who have put together chess playing software.  The top chess players can now simulate games with top players, and analyze moves made in past matches to determine what the highest probability move to make is.  These machines can be used as training tools to make the top players even stronger.  But in the event, they are left alone with just their wits, hand against hand. 

There is a form of chess that Cowen describes that breaks down these boundaries.  Where using a computer in normal chess matches would be cheating, this new kind of chess allows collaboration with teams of players using computers to find the best move, move-by-move.  These are the ultimate players and who will figure in the future of the workplace.  You have to be able to be and create a tech –mediated team like this to be successful in the future.  Otherwise, you will be eating cat food.

I may be over-reading the book, but I have to make an admission.  Cowen lost me very early on.  The problem with the structure of the future is that there is no seeming consideration of the state until the last third of the book.  Immigration, trade, and taxation finally come up as policy decisions that have to be made.  Instead, the projection of the future Cowen draws makes it seem like it happens in the vacuum of the free market.  It feels like he is making a massive hand wave and accepting grossly divided future as fact.  The problem is that in accepting it as fact is almost the same as validating it.  Whole books have recently been written by former Nobelist in economics lamenting this very hollowing out of the middle class, and the author seems to shrug his shoulders.  Inequality is the issue, and he seems to give it a tacit endorsement.  Once I gained that feeling about the book and its author, I wasn’t able to be objective about the argument.