Elon Musk has become the world's first trillionaire. But is this simply the result of inflation and economic growth, or does it signal that we're entering a new era of wealth creation?

In this episode, Nick, Peter and Fraser ask whether today's extraordinary fortunes are genuinely unprecedented or simply the latest point on a centuries-long trend. Along the way they unpack the difference between nominal and real wealth, ask who history's first 'real' billionaire might have been, and examine how technological revolutions have created new extremes of wealth.

The conversation then broadens into a discussion about exponential growth, artificial intelligence and the future of capitalism. As AI increasingly replaces cognitive labour, could wealth become concentrated in the hands of those who own the technology rather than those who work? If so, what happens to employment, economic growth and the social contract?

• SpaceX acquires Cursor
• First dollar millionaire - John Jacob Astor
• First dollar billionaire - John D Rockefeller
• Holden Karnofsky, 'The Most Important Century'
• Thomas Young, 'The Last Man Who Knew Everything'

Hello and welcome to the Cognitive Engineering Podcast brought to you by Aleph Insights and produced by me, Fraser McGruer. I'm here with Nick Hare and Peter Coghill of Aleph Insights. On this podcast we look at a wide range of topics from an analytical viewpoint.

And today we're discussing the world's first trillionaire. Peter, tell us about the world's first trillionaire.

Well, I'm going to avoid talking about Elon Musk as much as possible, but this came from a musing that I had. It just, it just struck me very recently that I read quite a lot of business news around AI because it's sort of interesting.

AI and technology because I find it interesting.

But it just struck me that the mergers and acquisitions, the figures, but also beyond that, the wages at the top of any given software technology professional profession just struck me as being well over an order of magnitude greater now these days than they were 10 years ago when I first started being for the tech sector. Did you say tech sector? Mainly? Yeah, but I think it's true in other sectors as well.

So I'm thinking like the, you know, the multimillion dollar a year pay packets for top AI engineers at Anthropic OpenAI, etc. I haven't got a figure, but the price paid by Tesla, sorry for Not Tesla, by SpaceX for cursor, which is an AI software engineering company that was.

But also just the valuations of things like SpaceX and Tesla. So SpaceX was valued at 800 billion when it floated.

That's a lot of money.

I remember when, I remember when Google was worth a trillion pounds and that was a trillion dollars and that was a big deal. I remember when Apple was worth 1 billion and that was a big deal.

So it just feels like the rates of these things that shouldn't have happened in my lifetime if we're only things are if things, if the values of things are going up by 2% equivalent of GDP each year.

It just seems like the sort of rates of the sizes of things at the top end of tech and business is outstripping the value that's added to the economy every year and therefore the value that most people see on their pay packets.

So the big stuff, the biggest stuff is getting bigger quicker, bigger more quickly than one might expect and not necessarily, and is taking up absurd large proportion in terms of the ratio to everything.

Else seems to be okay anecdotally and without running any detailed numbers, it just seems big stuff's getting bigger way quicker than it feels like it should Be.

And so these were the musings, but now we've got to do something out of this. Is this a call for revolution? Is this what you're saying, Peter? Or are we going in another direction? So what are we trying to, what.

Do we want to do with this information? Yeah, well, I think maybe we dig into like are the numbers actually any bigger? And I think Nick can probably help out with this. But let's start with.

So Elon Musk's net worth past 1.2 trillion recently. So that's roughly 10 times what it took to be. These are the richest men in the world. That's 10 times what it took to be number one 10 years ago.

So quite a lot. Yeah.

Remember when Bill Gates was really rich?

Yeah. That was only 10 years ago.

Now he looks like a pauper.

So the top 10 range back then was 40 to 40 to 90 billion ish. Top 10 range now is 148 to 608 billion.

So I want Peter to put down his AK47 and take that balaclava off and let's have a look at some of the numbers before we overreact. I agree. It definitely feels like the numbers have got too big to be sensible. Let's just have a go on.

Well, I'll just say out of interest, I'm curiosity, how many trillion dollar economies are there in the world? Because that used to be a thing.

Well, hang on. See now we need to start being careful here because what we're talking about here is his wealth.

Yeah.

Rather which is not the same as income. Right. Where you can't directly compare them. I mean you kind of can in the long term.

But you know, the, the wealth, wealth is your total amount of assets that you possess or have accrued. And you know, it's like the global wealth is at least an order of magnitude higher than, than global income.

Yeah.

So I mean income, you know, the amount of wealth you have changes each year. Basically the amount you produced minus the amount you consumed.

Right.

And, and in fact most people on earth, the majority of people don't have any wealth, you know, because they all have minimal, very minimal wealth or most or in negative wealth because they are actually net debtors. And there's nothing is not necessarily a sign that anything's wrong. Right.

So but let's just, let's start with the very simplest case and start looking at what the trends look like for. For wealth, like big wealth. And here I'm talking about nominal dollar wealth. Right. Headlines. Elon Musk is a trillionaire.

What we mean is he's got a trillion 20, $26. When was the first millionaire in dollars out of the time? We're not controlling for inflation or anything like this.

It's nominal. So I'm going to say if it's nominal, I'm going to say 19th century. Yeah, I'm going to say we're talking like building railroads and all that.

Yeah, that's what I thought. No, it's actually earlier than that. John Jacob Astor generally believed to be the first dollar millionaire.

I mean, and so if you're in nominal territory things, you're going to have to just make some compromises here because someone, you know, where there's hyperinflation is going to magically be a, you know, billionaire. We don't care about that. We're just talking about the dollar.

Pure dollar times how many dollary dues has that guy got in his bank account kind of thing. So John Jacob Astor, who made his money through the fur trade and opium, my two favorite things. Wholesome, wholesome product. Who made his.

Ish.

Right. And then.

And then, interestingly, he also became the world's first multimillionaire and died with probably about 30 million of the dollars at the time, surrounded by heaps of fur and like Scrooge McDuck in a swimming pool. He drowned in a swimming pool full of gold. And. And then who's the first billionaire?

How far back do we have to go to find our first nominal dollar billionaire? So again, it's probably a name you've heard of. Think of a Top Hattie.

No, no.

When I say we're talking early 20th century, we're talking American again. We're talking like probably in between wars. We're talking. I don't know, it's one of them. It's one of these, like, Carnegie sort of.

It's John D. Rockefeller. Yeah, there we go. Cigars, Big, big hats.

Yeah.

Oh, good Lord.

So it'd be nice to go back and say, well, actually, who would have been the first person?

There's some caveman knocking around with all these rocks.

Exactly. And the problem we've got is we're talking about a unit, and the unit changes over time.

So now what we're talking about is not how many, the number, but the actual stuff, like the amount of stuff. So here's the question we're asking when we're thinking about, okay, how do we measure inflation?

So it's good.

And that tells us how much coffee, the inflation in coffee, because it's the same stuff, but the number has changed, so we know the value is the same. And when you measure inflation, you do that with all goods.

You basically take a basket of goods, you track them year on year, how much of the same amount of stuff changed in price on average, across the economy, and then you use that to do the adjustment. Right. Challenging for all of it.

Still quite tricky.

Well, the physical object, but also there's no mobile phone networks. So on that basis, probably, you know, very little. There is the problem that we get more productive over time.

So even if prices didn't change, right, if the price of you get more productive, so that dollars worth of coffee just feels less valuable anyway because it's easier for you to do work to create that amount of coffee, it might only take you 1 minute to work to get, you know, a dollar's worth of coffee, whereas in the past, it might have taken you 10 minutes or an hour to get a dollar's worth of coffee. So there's that effect we need to think about. Like, do we. Do we care about what a millionaire feels like or what action the stuff they've got.

And then, and then there's the question about the share of wealth, which is obviously your current wealth would make you the richest person on Earth in the year 10,000 B.C.

If you were the only one to go back in time.

If you took all your stuff back in time, you'd be the richest person on earth. But would you, would you, would you feel the same amount of wealth as you do now?

No, you'd feel like some kind of God going back and showing them your amazing 21st century duvet. So there's all those things that we have to worry about when we're trying to make these comparisons over time.

And they're all genuine, real things to worry about that just skip overable. But I'm going to skip over them anyway. So we've got Elon Musk and his trillion dollars worth of stuff.

Let's just one thing, important thing to bear in mind is he doesn't actually have a trillion dollars worth of stuff. He has not got a bank account which has a trillion dollars in it that he can check with his atm. Look at that. Right.

He's got loads of assets, particularly stock holdings, which at any given time, unrealized. Yes, exactly. And if you multiplied the price of each of those shares by the amount he has, lo and behold, it's more than a bit. He has.

So, but let's imagine that he just sold everything and bought, well, let's say coffee, you know, or something. He bought some basket of stuff that he can take back in time.

So, so we, we, what we're asking is, well, who was the first, who was the first person to have the amount of stuff Elon Musk owns? And the answer is Elon Musk. I was going to say, yeah, it's. There has never, as far as I can tell, been a real terms trillionaire.

Nobody's ever owned as much stuff as Elon Musk. Right. Now here's where it gets more interesting. Who was the first person to own a billion dollars worth of 20, 26 stuff?

This is what I was gonna say. So this is where it gets, as you say, it gets interesting. Let's say we take a billion. Let's say we take a million.

Just to be absolutely clear again, what this thought experiment is. It's you buy a billion dollars worth of stuff and you put it in a warehouse and you go, great, that's what a billion dollars looks like.

Who was the first person to own that much stuff?

Well, I think so if we're talking a billion, I'm gonna guess I mean, is there a person? I suspect. Yes, there would have been.

There is actually. I think, I think an identifiable person.

Oh, God. Okay.

An identifiable person who may have cropped up earlier in the discussion.

Okay, so it's gonna be one of those two that we mentioned before.

No, it's actually rocket. No, so it's actually. No, it's John Jacob Astor.

Okay.

Because remember that the first real billionaire.

Yeah, yeah.

Is gonna look more like the first nominal millionaire because of inflation.

Yeah, yeah, yeah.

So the amount of stuff that John Jacob Astor could buy. So he was our first millionaire.

And we're saying in real time when.

He was a millionaire, the stuff he could buy would be worth closer to a billion pounds today. So I think he's very plausible. Actually, it does all come together and make him plausibly the world's first billionaire.

Now who's the world's first real terms millionaire? So the first person to own the amount of stuff you could buy with a million dollars today.

I reckon this could be a lot of people.

Well, there's only going to be one first person. Well, do you want to have a stab? Oh, God, no. But you're absolutely right.

Of course, you know, it's going to be like the thousand. Who's the first thousand heir? It's a bit like that.

Well, but let's. I mean, a million dollars worth of stuff is not bonkers.

So this is probably going to be someone European. We're talking empires here, probably. We're talking about imperial stuff. Probably. It's probably.

Wait a minute. Tell me what, what a million dollars worth of stuff looks like in a, in a room.

What? Depends what the stuff is.

We could easily get a million dollars worth of stuff in this room. Yeah, right. It's not a million dollars.

Gold.

Gold would be quite small, bit heavy. But I mean, a million dollars is a nice house. Yeah, It's a semi detached house in, in, you know, in, in San Francisco or something.

Yeah, yeah.

It's not, it's not a, you know, it's not.

So we're either talking.

Who's the first person to own a house as nice as, you know, a million dollar house in San Francisco?

I don't know the answer. Tell me. Like, so it's like.

Well, I've got no idea because it would have been thousands of years ago. It's going to be someone in, you know, in ancient agricultural.

Well, it.

Probably some sort of king. Probably going to be a king of some sort or very least achieve some, you know, but, but because it's not A lot of stuff. A million.

So what I'm saying is that that growth, right, from real terms, we've gone from trillionaire, billionaire, real terms, billionaire, 200 years ago, more or less, and then thousands of years before that. But actually this is more or less how the economy has grown. It's not totally out of whack, it's not totally bonkers. Right, We've got to go now.

What about the world's first thousandaire?

Oh, my God, we. Yeah, okay. No, no, so. Because there was a. All right, yeah. I don't know. Lots.

A thousand quid would get you a few cows. So I think you're looking at some. Someone in the early agricultural or possibly late hunter gatherer times.

We're definitely in the 5,000, 6,000, 10,000 BC times here.

So look, what I think is interesting about this is. And it makes sense, it's logical or it follows really, if you're talking about the first each time necessarily, it's going to be on a cusp, right.

Of an age.

Okay, maybe so I think. Well, almost certainly, because a cusp of an age changing is when you get that rapid change suddenly. Okay. And that's why.

So we might be looking back to sort of agrarian revolution or whatever it's called, you know, when people first sort of moved from hunter gatherer to farming, let's say, and then industrial revolution and then communications revolution, and then here we are, whatever the crazy term, you might have nailed it.

That's a really interesting point.

Yeah, yeah.

So does that mean that Elon Musk.

What does it mean?

Is presaging the cusp of a new.

Right, yeah. And I think you can say it's really difficult, as we've discussed before, it's really difficult to identify change when change is happening. Okay.

But I think there are certain markers that might suggest it, if you know what to look out for. And one of them might be, hey, is there anyone suddenly just come a trillionaire. And it's.

So you could argue in this, defining this age that we are now, is there a change? Right. And is this.

We've moved beyond the communications revolution and this is for this sake of calling it something, let's call it the AI revolution for a moment. Although how relevant that is to musk or not, I don't know. But. But anyway, let's call it that for a moment.

I mean, actually he's made his money not really through AI.

No, right, exactly. That's what I mean. But anyway, we're sort of starting to grope towards something. Something there so far we're digging into stuff.

I'm not, I'm still not sure what we want to try and answer, but kind of maybe doesn't matter too much. But Peter, you got something.

But I noticed from your first plot on time, they are accelerating. It's exponential.

So this is the other thing, non.

Exponentiality of all this. Let's go into that, Peter.

Yeah, so I mean, this is where this whole question was taking me is like, is this perceived weirdness a feature of the exponential nature of the growth of the economy? For the most of human history, say 10,000 years or so, growth was less than 0.1% per year.

And the stat he uses is if we kept growing at 2% for 10,000 years.

So like the next 10,000 years of human history, the second 10,000 years of human history, it would require an Earth sized economy, current Earth sized economy, for every atom in the galaxy. So every atom in the galaxy would have to be turned into an Earth producing all the stuff that our Earth today produces.

Right. So we're talking about necessary resources.

Yeah, so it's, it's sort of accelerating and hence possibly getting really weird. Like how do you, how do we, if we are able to sustain 2% growth and lots of people say no, we can't, it will sort of tail off in some way.

Things have to get pretty weird pretty fast, pretty soon to keep growing like that.

Well, but technology means that value is not just measurable in terms of grams of stuff.

Than a lump of stone.

Yeah, yeah.

So I think there's that, that actually, you know, value can inhere in utility, which isn't necessarily Measurable, you could get the unearth sized amount of utility out of a small object.

It's doing something really useful.

Whether I can get it out of a single atom is a challenge, but it's not inconceivable because there's not in theory any limit to how useful something could be.

I mean, you know, it could be that the next generation of technology is 10 times more useful than the previous generation without using any more mass. And if that keeps happening, and if you imagine that kind of concept of, well, how can I measure how good this is?

Well, it takes 10 of the last lot to deliver the same output as this one.

Given that it could happen, it's doable.

Yeah.

So like it's not, it's this sort of, you know, fusion power has always been on the horizon. And we've been driving, everyone's kind of been driving cars around since car ownership became a thing. And we still have cars.

It's not like tomorrow we wake up and all the cars are gone and everyone's suddenly running around in flying boots. It won't be long before that is the sort of level of progress we're talking about.

We'll see a measurable difference day on day rather than decade on decade.

But isn't there some bottleneck which is our ability to adopt that technology and absorb it, that is not necessarily to do with technological growth. You know, it is about our cultural excellence. I mean, we've got all of those things that I don't use, like smart locks.

I'm never going to get a smart lock. But the technology's been around for a while and I sort of think, well, you know, so how can there be that rate of change?

But the other thing I want to.

Say is that I suspect the substrate might change a great deal, but what you perceive doesn't.

So it could be that Tomorrow, if we're 50 years on from now and we're still on this exponential curve, it might be that tomorrow you can't buy a standard lock.

Smart locks are all you buy and you might not notice the difference, but the smart lock features are there, but it can behave like a dumb lock for the holdouts.

Sorry, go on, Peter.

So, yeah, I think you might get holdouts, but the complexity of life underneath your sort of perception will just get more and more and more and more complex. At an ever increasing rate.

I mean, we need to be careful and focus because this potentially launches off into so many different directions. Right. So we're talking about adaptation processing, but also talk about marginal gains.

And so I think something we've talked about before which, yeah, you can vent the wheel fire. And I think we talked about, you know, inventions, changing the nature of inventions.

And so smart lock is a good example where you got a lock which will lock stuff. You've got a smart lock which will do it another way, but essentially still doing the same job. Right.

One of them requires me to download an app. Not going to do it.

Exactly. So the two can coexist. Right. Or can they? I don't know.

But one question though that I think might be interesting pursue is implications of what you've said, Peter, which is it just sounds like, you know, exponentially getting faster, faster, faster. It just sounds like something like suddenly the wheel's going to fall off.

Yeah. And that's how exponentials feel, Right. They, it feels like nothing's happening for a very long time because the growth is so.

And then suddenly they kind of turn the corner.

Well, I want to say something different actually about exponentials, which is that wherever you are on an exponential graph always looks the same. Like if you. That's the nature of the curve. The nature of the curve is such that, you know, if you rescale it, it looks the same. So wherever.

It always feels like you've had a very slow run up and you've got a very, very fast future. But when you, when you, you know, if you're doubling every year, well, it always looks like, you know, what's happened is a bunch of time.

It looks like halving in the past and halving feels very sort of slow and it just sort of slowly peters out over hundreds of years to nothing. But bloody hell, look at the future. It's like double, double, double.

But it always feels like that wherever you are, it's possible that we will, you know, two the people of a hundred years ago living life with the rate of change we are used to would be inconceivable. I might think it would break our brains off, but it hasn't done. And it's possible that we are actually, it will do.

There are limits.

But I just feel like people said in the olden days.

Well true, but the very fact that you can say that puts you into the position of. You're changing your. Into a position of an observer. Right. I think it's a bit of how to do that. We're talking about relativity here.

It's a bit of a logical fallacy to say because we've been wrong before, we'll be wrong again.

No, it's not even being wrong. I'm saying the feeling, the perception of. Of is always that. I mean, in a sense like that is just what it feels like. Someone. Someone.

Someone way back here looks. Looks. We don't see that very much has changed because, oh, they're on, like, you know, they're. We're on one and they're way back here on sort of 0.1.

But that doesn't feel like very much change compared to what's happening next week when it goes up to 10. But for their point of view, they've gone from 0.1 to we're now at 10. We're the people who look like we've been on this massive roller coaster.

It looks the same wherever you are, but the gradient changes.

Yeah. So it doesn't.

The absolute does, but the relative. What I'm saying is like that.

But if you have the power to observe that and to know that that's happening, I mean, nonetheless, the rate of change is still exponentially on that part of it where it is going faster.

Yeah. And we don't. You're saying scale it, but you're scaling it logarithmically. Our brains don't work like that. Our brains are very linear.

Cope pretty well in an amazingly surprising way with the fact that we live a lifestyle which is unrecognizable from that of our parents, let alone.

You know, I agree that we're remarkable that we've, like.

You think there is a hard limit somewhere?

Yeah, yeah, there's a hard limit. I mean, there's a. There's definitely hard limits.

I mean, for example, 10,000 years ago, one scholar could understand everything that the human race sort of knew. They could, like, because there wasn't much written down.

Well, yes, very little indeed. And they even invented writing.

Some. Some. Yeah. Sometime in the kind of Middle Ages, a scholar would lost that ability to read.

Yeah, I think there was. Isn't there, some guy. I can't remember who it was. It would be like someone called, you know, John of John of Ghent or something. Was.

Was supposed to have been the last ones, you know, everything.

Yeah.

And. And that's not been 600 years ago.

And that's not been true for really so. And more recently in any one field, a scholar lost the ability to know everything in that field. And fields get ever more subdivided.

So, like, what I'm Saying is, life gets more complicated. The stuff we know or have to know in order to understand the world increases.

So at some point you're not going to have the bandwidth to understand what's going on. You're going to live in a sort of perceptual layer of, of what you kind of see and do and touch and feel during the day.

Stuff that goes on underneath it. Stuff that goes on underneath it is going to be this sort of weird, strange world that's delinked from your perception of it.

Well, I can very much feel like.

That now, just to concrete that out. It's like when you get on a train. By observing the train, you can kind of get a feel for how it works. It's sort of.

It's a box with wheels on it that runs on a metal track.

You can tell he's an engineer.

You can sort of see that and you can have it. You can build an intuitive model about how the train works.

So, you know, it might be the case that 50 years time we have this weird technology that makes trains sort of float around or train. We don't use trains anymore. We kind of go through a little portal and we appear somewhere else. We'll lose that physical connection to the world.

That is how our brains work.

Yeah, absolutely. So look, we're most the way through. We need to move towards a kind of a sort of a closing.

Well, I just, I want to. I just want to say a couple of other observations about the dangers of using extremities to represent trends.

Okay.

So just. And again, it's more of like. Calm down, Peter.

Yeah, it's just, it's quite excitable generally.

Like.

Well, but hold on, Nick, sorry, before you do and yeah, yeah, please do that. I just still want to. I still trying to. I'm still trying to work out what we're discussing, what we're trying to answer.

Okay, Well, I think, okay, I guess it's this, like, does we've got a trillionaire. It feels like only minutes since we had a billionaire. Is it like going to be. Is it going to be a quadrillionaire next week?

And it's like all the numbers just going bonkers and are we just going to not be able to cope? And Peter thinks we might be getting to a point where it is going to be hard to cope. And I'm a bit more sanguine about the whole thing.

Got it right.

I'd say I feel comfortable with that.

So, yeah, go for what you're going to say.

Yeah, no, the Other thing is we should be wary of using the extreme values of a distribution as particularly significant. It is interesting that we have a trillionaire and he is proportionally much, much more as at an extreme of wealth than we have had previously.

It's not bonkers. It's not out of this world. John Jacob Astor was supposed to have had. His wealth was equivalent to about 1% of GDP of US GDP.

And Elon Musk's wealth, if it's a trillion pounds, I think is equivalent to some number of percentage points. I can't remember what US GDP is, but it's not orders. He doesn't own double. It's not an order of magnitude more than gdp, for example.

So, you know, but the point is that it is still, you know, at one extreme of this distribution. But, but obviously like the guy, the average guy.

Well, actually that looks much more like a kind of fairly boring trend growing as Peter says, you know, 2 to 3% a year.

So the outliers are not getting too outliery.

The outliers are getting more outlier.

Right. But they're not exponentially not.

Well, not, it's not ridiculous how much they've grown. But it is an interesting question as to, well, why is it that the richest person now is proportionally much, well, more.

Proportionally much more richer than kind of the average person than the millionaire was back in the day. Again, I mean, think of the difference between the average earnings of someone in ancient Assyria compared to the, the wealth of their king.

It would be a similar, you know, we'd be looking at a similar order of magnitude. That's if you have all those questions about, well, is the king the same as the treasury?

You know, in the olden days, I mean, if, if we considered, as Donald Trump himself seems to do, the wealth of the United States to be the personal possession of Donald Trump, then, you know, totally different story. So, so yeah, anyway, Peter, I think, did you, did you have a look at what this means for the man?

I didn't, no.

Oh, I thought, I thought you were going to say something about is it going, does it make people go bonkers?

No, fuck that guy. But I, but no, what I did look at is reasons to be, reason to be fearful for why weirdification gets even weirder.

Right. Okay.

Okay.

With this sort of exponential runaway growth and trend, a key trend that drives, that is a shift from value in the economy being created by labor. So people doing stuff, making stuff for other people, two capital.

So people investing in stuff, lending money, that kind of stuff that Shift has sort of continued. We're not tipped over quite yet in terms of capital overtaking labor, but it's not far away. 20, 30, Some people kind of estimate it will tip over.

What this means.

It's terrifying, actually.

Yeah, well, not really where you are. No one's stopping you buying a share of a company or something. You want to be a capitalist?

Well, I mean, yeah, I mean, I think. Keep going, Peter. I do think it's terrifying.

Yeah. But it's also. It's terrifying because I think that trend might accelerate with things like AI. Right.

So a doomish scenario is that AI companies corner all cognitive work. So the work that's been hitherto replaced has been manual work. So think. People used to dig with spades and pickaxes, and now we use a power shovel.

People used to till the fields, but now we use a tractor. Right. So that's manual labor has been replaced by machines. AI eats away at the cognitive labor pool. Right. So if.

So one doomy scenario is that AI companies corner all capital that's generated all labor that's generated by cognitive labor, and they've instantly turned that basically into capital. So you own an AI system. You can now do everything. Right. So that's worrying. That kind of excites.

And what happens, though, when labor share is eaten away further? So GDP stops being a sort of proxy for prosperity? You can no longer say, oh, well, we grew 5% this year. We did well, we grew 2% last year.

That was less. Good. Because it's really measuring how much longer the capitalists have, and that doesn't translate to goods and services directly or less directly.

So the sort of. The social. The social contract we have now kind of assumes that work begets income, begets consumption. But that model doesn't necessarily exist.

Yeah.

When it's all the capital's cornered.

So, I mean, Peter's convinced me. He's turned me into a communist. It is time to pick up that Kalashnikov again.

Right, well, but hang on. Yes, let's accept. Let's accept. But I know, I don't. I don't think labor will.

It's true that labor has been losing its share of income, which is not necessarily what you might intuitively precisely think we mean by this. But yes, the sort of. Basically the amount of GDP that kind of ends up going to the.

To the owners of the productive capital versus the, you know, wage earners, basically. Yes, obviously there's vastly more machines now than there were a thousand years ago.

Obviously labor is a less of a less A smaller part of the production function. So you would expect this to happen. But let's assume that that continues and that all value starts gradually.

99% Of value is being produced by machines. Well, there's nothing in principle that means we can't own those machines. And there is, though, that. Well, I mean, it does.

I agree that you might be skeptical, you might rightly be skeptical or pessimistic about the willingness of someone like Elon Musk to part company with some of his trillion pounds, trillion dollars.

But the point is that we've kind of been there before and you know, the idea that, well, we have a kind of, you know, partial state ownership or public ownership of some of these corporations, it's not.

I mean, you know, Norway has an enormous sovereign wealth fund which they use to generate effectively free money for their, for their, their population.

Right.

So there are ways that this could work, you know, that we could, we could effectively. Yeah, I don't want to say nationalize. I think they're at least publicly owned some of the capital and then just use that money to spend on welfare.

And hey, President, I'm not suggesting we should take up arms about this, but what I'm suggesting is we kind of get on and put the funds framework in that captures some of the wealth.

Because there's a danger that we end up with a mad king problem where if we don't put the brakes on, if government doesn't put legislation in place which captures some of this wealth for the population, then you end up with people who are so unbelievably wealthy, they can operate as their own state.

Yeah.

And as soon as, I mean, the danger, what we want to look out for is Tesla acquiring its own security forces. Because, I mean, and it's not a ridiculous thing to think, you know, we did. Well, we did a podcast very recently about evil corporations.

We should expect corporations to be self interested. And if that means, well, you know, we're going to protect our assets using the latest terrifying robot death dogs, then they'll do that.

And as soon as you have a company actually with its own capability of projecting force, then you've got your kind of East India company problem. And then it might be too late at that point to start coercing them.

But I say they already have that. I mean, Microsoft, Google, they control the tools that people use to do their work.

Yes. They could just switch off word and we'd all suddenly become more productive.

Yeah, no, I think it's time to pick a side.

They own the infrastruct they have the power to kind of.

But I suppose all I want to say is I think anyone who's ever been down a mine, like, I haven't anyone who's ever been down a mine, if they said, look, you know, you're going to lose, what we're going to do is instead of you, we're going to give you shares in this automated mine and you just have to sit there and you get paid the same, but a robot's doing the job for you. You lose the nobility of labor that Karl Marx was so keen on, but you don't get emphysema and you won't die at the age of 47 of.

Well, you're talking about UBI at this point.

Well, no, no, no, I'm really. I'm running with your vision, but I'm saying there's no reason that we shouldn't all be owners of capital, right?

Like in the same way that we own labor, it's a much nicer vision that we no longer. That our labor isn't worth very much, but the capital that we have is doing all the earning for us. That's obviously a better way to be.

Like, it's mad to think, well, that's terrible, that labour loses its share of income. That should be a good thing. Let's start from there and work out how we can.

I don't think it's necessarily a bad thing, but I'm saying the way that the current legislation we have doesn't guarantee that that will happen or will make that unlikely to happen. People have. Most people have fairly marginal income, so they haven't got money to put away and invest in shares and things.

They're living hand to mouth.

I guess so. Kalashnikovs, lads.

Yeah.

All right, there we go.

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Sam.