A Case for AI: Automate the CEOsA sophisticated algorithm can now accomplish the tasks of a CEO with a higher success rate than flawed humans who, all too often, do cocaine.
The following story is co-published with How Things Work, a labor and politics Substack written by labor journalist Hamilton Nolan. Check out his Substack here.
A new technology causes panic among the work force. Jobs once vital are overnight rendered useless. At stunning speed, artificial intelligence evolves to replace roles that were previously thought to be timeless redoubts of human ingenuity. Nevertheless, this is the creative destruction of progress. It is inevitable, and its increased efficiency will accrue to the common good. Though it will be hard for these unlucky workers, we must suck it up, look them in the eye, and say: Sorry, CEOs. We don’t need you any more.
Let’s be rational here. If I were to imagine a job that was a perfect candidate for replacement by AI, it would be one that consists of measurable tasks that can be learned—allocation of capital, creation and execution of market strategy, selection of candidates for top roles—and one that costs the company a shitload of money. In other words: executives. These lazy, greedy employees spend much of their day sitting on their asses, making yes-or-no decisions, yet they reward themselves with grotesque pay packages. In fact, the average CEO of a major company costs the equivalent of almost 400 workers. Shareholders are spending these extravagant sums for tasks that can now be done just as well by an AI program trained on 100 years of corporate reports and Wall Street Journal texts. What should we sell? What should we spend? What should we cut? Clearly, a sophisticated algorithm can now accomplish these tasks with a higher success rate than flawed humans who, all too often, do cocaine.
AI can win at chess now. You think being a CEO is harder than chess? Come on.
It is no coincidence that those of us who make up the “creative class,” who are collectively striking and sweating and strategizing with the utmost of our ability to get ahead of the prospect of AI replacing us, have quickly realized that this technology is in fact far better suited to replace our bosses, whose jobs are a million times more rote than ours. As Alex Pareene wrote, “A computer would do a better job owning the Oakland A’s than it would writing about them.” This, after all, was something of the same insight that Vanguard founder Jack Bogle had about the investment industry: Buying everything and doing nothing actually earned people more money than paying expensive consultants high fees to pick stocks and buy and sell for them. The whole investment industry was, with rare exceptions, a scam designed to enrich the managers rather than the clients. And when we can program an AI with a set of parameters and let it make rational decisions for a company, the same thing is true of CEOs. Bye!
Part of the game that employers at large are playing with AI is publicly pretending that this technology will benefit all of us, while relentlessly scheming to use it to zero out labor costs. Most of them don’t say that out loud. This week, though, Buzzfeed CEO Jonah Peretti went mask off, telling investors that “Over the next few years, generative AI will replace the majority of static content,” a development that “makes our creative team more efficient and sustainably expands our output without increasing fixed costs.” What this means is “infinite robot-produced dreck with no more employees.”
Is this a stroke of brilliance from the mind of a business genius who knows how to achieve success in the media industry? Well, let’s take a look at the stock price of Buzzfeed, under Peretti’s reign:
Let’s see. In two years it went from almost ten to less than one. I’m just a simple writer—is that good? It must be, since Peretti is still earning millions leading the company, while all the reporters are getting laid off. Sure, AI can write a quiz, but we can’t expect it to be up to the task of cratering a business’s value by 90% in a short period of time. For that, you need a real CEO.
It’s nice to imagine a world in which algorithms replace CEOs and you could program them with the precise relative importance of each stakeholder in the business and then watch them manage a company in a way that respects workers and the public interest. This technology could, in another world, be a launching point for a million co-ops that are owned by employees and managed by a benevolent computer. The fact that this (technically feasible!) idea seems laughable is just a reminder that the whole conversation about automation is far more about power than it is about efficiency. Companies exist to enrich shareholders and managers. Making this group of people rich is the point of all the business activity. Workers are counted as a cost, detrimental to the goal of reserving all profits for the owners. So automating workers out of existence is counted as common sense, while automating executives out of existence plainly contradicts the goal of making executives rich. Efficiency is much praised in the business world, but, as Upton Sinclair pointed out, it is hard to get a man to understand something when his salary depends on not understanding it.
Understanding this basic power struggle is what makes unions the only institutions effective enough to get ahead of a Buzzfeed-style AI-fueled employment bloodbath. The CEOs will be spared from automation not because they should be, but because they are making the decisions about who is spared from automation. As a quick and dirty heuristic, it is most accurate to think of bosses simply as class enemies. (This saves you a lot of hand-wringing about how nice your boss was, before they laid you off.) So when you see, for example, Elon Musk denouncing employees working from home by saying, “The people that fix your house — they can’t work from home? But, you can? Does that seem morally right?” [An aside: ????????], you can save yourself a long period of being agog at what a spectacularly unaware putz this rich guy is by just referring to the above heuristic.
I’m fairly sure that Boston Dynamics can, today, construct a robot that can throw a dart at a pile of screenplays and then say “fund those ones,” thereby effectively replacing a Hollywood studio boss. But that would defeat the whole point of the racket, you see. So until then, support the Writers Guild strike. Look out for your own job. Join a union. And if you start an AI-managed co-op, let me know. Could be good.Wait, before you go…
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