6 ms·

> My prediction is no, because productivity gains must benefit the lower classes to see a multiplier in the economy. Baumol's cost disease hurts the lower clas

> My prediction is no, because productivity gains must benefit the lower classes to see a multiplier in the economy. Baumol's cost disease hurts the lower classes by restricting their access to services like health care and education, and LLMs/agents make it possible to increase productivity in these areas in ways which were once unimaginable. The problem with services is that they're typically resistant to productivity growth, and that's finally changing. If you can get high quality medical advice for effectively nothing, if you can get high quality individualized tutoring for free, that's a pretty big game changer for a lot of people. Prices on these services have been rising to the stratosphere over the past few decades because it's so difficult to increase the productivity of individual medical practitioners and educators. We're entering an era that could finally break this logjam.

bwestergard 7mo ago
"Baumol's cost disease hurts the lower classes by restricting their access to services like health care and education, and LLMs/agents make it possible to increase productivity in these areas in ways which were once unimaginable." You've expressed very clearly what LLMs would have to do in order to be economically transformative. "If you can get high quality medical advice for effectively nothing, if you can get high quality individualized tutoring for free, that's a pretty big game changer for a lot of people. Prices on these services have been rising to the stratosphere over the past few decades because it's so difficult to increase the productivity of individual medical practitioners and educators. We're entering an era that could finally break this logjam." It's not that process innovations are lacking, it's that product innovations are perceived as an indignity by most people. Why should one child get an LLM teacher or doctor while others get individualized attention by a skilled human being?
- somekyle2 7mo ago
  It also seems like the value of quality tutoring that doesn't primarily function as social/class signaling goes down as tools capable of automating high quality intellectual work are more widely available.
  - mullingitover 7mo ago
    It depends on outcome again: is the value of tutoring the social class elevation, or is it in the outcome of becoming more skilled and knowledgable? There's also the deeper philosophical question of what is the meaning of life, and if there's inherent value in learning outside of what remunerative advantages you reap from it.
- mullingitover 7mo ago
  > Why should one child get an LLM teacher or doctor while others get individualized attention by a skilled human being? Is the value in the outcome of receiving medical advice and care, and becoming educated, or is the value just in the co-opting of another human being's attention? If the value is in the outcome, the means to achieving that aren't of much consequence.
  - alwa 7mo ago
    More subtly, what is an education? What is care? As you point out, the LLMs are (or probably will become) perfectly good at the measurable parts of those services; but I think the residual edge of “good” education/care is more than just the other human’s co-opted attention. How many of us have a reminiscence that starts “looking back, the most life-changing part of my primary or secondary education was ________,” where the blank is a person, not a curriculum module? How many doctors operate, at least in part, on hunches—on totalities of perception-filtered-through-experience that they can’t fully put into words? I’m reminded of the recent account of homebound elderly Japanese people relying on the Yakult delivery lady partly for tiny yoghurt drinks, but mainly for a glimmer of human contact [0]. Although I guess that cuts to your point: the value in that example really is just co-opting another human’s attention. In most of these caring professions, some of the value is in the measurable outcome (bacterial infection? Antibiotic!), but different means really do create different collections of value that don’t fully overlap (fine, I’ll actually lay off the wine because the doctor put the fear of the lord in me). I guess the optimistic case is, with the rote mechanical aspects automated away, maybe humans have more time to give each other the residual human element… [0] https://news.ycombinator.com/item?id=47287344 https://news.ycombinator.com/item?id=47287344
    - sayamqazi 7mo ago
      > How many of us have a reminiscence that starts “looking back, the most life-changing part of my primary or secondary education was ________,” For me it was a website with turotirals on how to make flash games. It literally launched my career and improved the quality of life for my whole family by an order of magnitude. I am primarily the naysayer of AI but I admit that current LLMs could have easily replicated the whole website.
- Finnucane 7mo ago
  If I described my symptoms to an AI and it suggested a diagnosis, I would defintely get a second opinion.
  - mullingitover 7mo ago
    That's reasonable, but don't feel like you're safe letting the humans rest on their laurels. Human medical errors kill thousands upon thousands every year.
- NetMageSCW 7mo ago
  I feel like lobster’s history might be relevant here - will at some point having a flawed forgetful human being give medical advice be for poor people?
mcmcmc 7mo ago
I’m sick of this idea that “free” services are beneficial to society. There is no such thing as a free lunch; users are essentially bartering their time, attention, IP (contributed content) and personal/behavioral data in exchange for access to the service. By selling those services at a cost of “free”, hyperscalers eliminate competition by forcing market entrants to compete against a unit price of 0. They have to have a secondary business to subsidize the losses from servicing the “free” users, which of course is usually targeted advertising to capitalize on the resources paid by users for access. Or simply selling to data brokers. With the importance of training data and network effects, “free” services even further concentrate market power. Everyone talks about how AI is going to take away jobs, but no one wants to confront how badly the anticompetitive practices in big tech are hurting the economy. Less competition means less opportunity for everyone else, regardless of consumer benefit. The only way it works if the “free” service for tutoring or healthcare is through government subsidies or an actual non-profit. Otherwise it’s just going to concentrate market power with the megacorps.
- hn_acc1 7mo ago
  This 1000x. "Free" is only a viable business model if the govt funds it. Otherwise, the $$ has to come from somewhere else in the company - how long will it take for the company to lose interest in a loss-leader when they're making $$ from other parts? Look at all the deprecated Google products. What happens when Gemini-SaaS makes billions from licensing to other companies, and Gemini-Charity-for-the-poors starts losing money? Sadly, the bigger the $$ in the tech pie, the more we have attracted robber barons, etc.
- drnick1 7mo ago
  > I’m sick of this idea that “free” services are beneficial to society. There is no such thing as a free lunch; users are essentially bartering their time, attention, IP (contributed content) and personal/behavioral data in exchange for access to the service. In aggregate, this is true, but there are many ways to game the system to one's advantage and get a true "free lunch." For example, people watching Youtube with an adblocker and logged out don't provide Google with any income or useful telemetry. Likewise you can get practically unlimited GPT/Claude/etc by using multiple accounts.
whatshisface 7mo ago
By the time it replaces doctors, nobody but today's investors will be able to afford anything at all. The X-shaped economy would have owners in the V and manual laborers (assuming this doesn't translate to gains in automation) in the ^. This outcome is worth avoiding...
nine_k 7mo ago
Can a robot write a medicine prescription? A medical procedure prescription? If yes, that would be a game-changer. But the medical insurance providers would be very cautious about honoring these. Then, if things go wrong, what entity would be held accountable for malpractice? You already can get a good-quality medical advice "for nothing", unless it requires e.g. a blood test. The question is, how actionable such an advice is going to be, and how even the quality is going to be.
- program_whiz 7mo ago
  There's a simple solution. If a medical malpractice happens, law suit against the LLM company. If their license is revoked as part of that finding, unfortunately that applies to the "doctor" (e.g. ChatGPT). Same for self-driving. Just hold each car like a normal driver, the owning AI company has liability. So after ~20 tickets and accidents in a week, a few ambulances being blocked, the only option is to revoke the driver's license (of which, all the cars share one, as they have the same brain). This would make AI companies more cautious and only advertise capabilities they actually have and can verify. They would be held to the standard of a human. I think that's reasonable (why replace humans if the outcome is worse, and why reduce protections for individuals). To make the analogy more clear: even if a telemedicine doc sees 10,000 patients a day all over the world, they would be held liable for any medical malpractice. Bad enough, and their license would be revoked, regardless of the fact that they see many patients all over the world. Same deal with AI / LLM -- if ChatGPT is making medical advice and it hurts someone, that's the same as a human doing so -- its malpractice and lawsuits can happen. If they are somehow licensed, well then that license can be revoked. We would revoke a human's license for a single offense in some cases, the same should occur with AI.
kurthr 7mo ago
You're implying that insurance companies will allow prices to fall and lower their profits. That seems like a really unlikely event in the current economy. They fire a lot of doctors and nurses, but they won't lower prices.
- xeromal 7mo ago
  This is assuming no competition materializes from the lowered friction
- skybrian 7mo ago
  The ACA requires 80-85% of health insurance to go toward medical care (medical loss ratio). The way they work around that is to figure out how to charge more for medical care.
  - kurthr 7mo ago
    Exactly my point.
jacquesm 7mo ago
Well, there's always wars as the way to get rid of people. I really don't rule out that the people that benefit from this sort of thing will purposefully steer the world in that direction because the poor won't have any choice other than to enlist as a way out of their situation, and never mind the consequences. You can already see some of this happening.
scubadude 7mo ago
> high quality medical advice I'll replace my doctor with AI immediately after the tech bros do lol
bumby 7mo ago
>If you can get high quality medical advice for effectively nothing This is an area where a confident, but wrong information is extremely costly. It’s like saying an LLM can give you high quality directions on how to tap into a high voltage transformer. Sure, but when it’s wrong, it’s very very wrong with disastrous consequences. That’s why professions like doctors and Engineers are more regulated than others.
- NetMageSCW 7mo ago
  It is definitely too early to expect AI medical advice to be usable (except in very limited instances) but the question is how long and how far will that change? After all, human doctors don’t do so well with new or under documented or rare conditions (consider the history of alpha-gal allergy or lyme disease sufferers even now).
ndr42 7mo ago
I'm not certain that a already observable negative impact of AI on some areas of education could be offset by "high quality individualized tutoring for free".
philistine 7mo ago
I didn’t know Claude Code could put a thermometer in my butt.
- NetMageSCW 7mo ago
  No human doctor needs to do that either - today, they just IR scan your temple or forehead. In a dedicated medical environment, there’s no reason that couldn’t automatic be fed into the AI.
  - philistine 7mo ago
    I didn’t know Claude Code could put an IR scanner to my forehead.
tsss 7mo ago
You could get high quality medical advice 20 years ago on the internet, or 40 years ago in the library. Doctors aren't there to give you advice, they are mostly gate keepers. Every person who's chronically ill knows that doctors are totally useless for anything beyond the 10 most common diseases and primarily exist to approve or reject your pleas for lab work. They won't go away, neither will psychotherapists and all the middle managers that can be easily automated, because their real purpose is not the practical work that they do.

bwestergard 7mo ago

"Baumol's cost disease hurts the lower classes by restricting their access to services like health care and education, and LLMs/agents make it possible to increase productivity in these areas in ways which were once unimaginable." You've expressed very clearly what LLMs would have to do in order to be economically transformative. "If you can get high quality medical advice for effectively nothing, if you can get high quality individualized tutoring for free, that's a pretty big game changer for a lot of people. Prices on these services have been rising to the stratosphere over the past few decades because it's so difficult to increase the productivity of individual medical practitioners and educators. We're entering an era that could finally break this logjam." It's not that process innovations are lacking, it's that product innovations are perceived as an indignity by most people. Why should one child get an LLM teacher or doctor while others get individualized attention by a skilled human being?

somekyle2 7mo ago
It also seems like the value of quality tutoring that doesn't primarily function as social/class signaling goes down as tools capable of automating high quality intellectual work are more widely available.
- mullingitover 7mo ago
  It depends on outcome again: is the value of tutoring the social class elevation, or is it in the outcome of becoming more skilled and knowledgable? There's also the deeper philosophical question of what is the meaning of life, and if there's inherent value in learning outside of what remunerative advantages you reap from it.
mullingitover 7mo ago
> Why should one child get an LLM teacher or doctor while others get individualized attention by a skilled human being? Is the value in the outcome of receiving medical advice and care, and becoming educated, or is the value just in the co-opting of another human being's attention? If the value is in the outcome, the means to achieving that aren't of much consequence.
- alwa 7mo ago
  More subtly, what is an education? What is care? As you point out, the LLMs are (or probably will become) perfectly good at the measurable parts of those services; but I think the residual edge of “good” education/care is more than just the other human’s co-opted attention. How many of us have a reminiscence that starts “looking back, the most life-changing part of my primary or secondary education was ________,” where the blank is a person, not a curriculum module? How many doctors operate, at least in part, on hunches—on totalities of perception-filtered-through-experience that they can’t fully put into words? I’m reminded of the recent account of homebound elderly Japanese people relying on the Yakult delivery lady partly for tiny yoghurt drinks, but mainly for a glimmer of human contact [0]. Although I guess that cuts to your point: the value in that example really is just co-opting another human’s attention. In most of these caring professions, some of the value is in the measurable outcome (bacterial infection? Antibiotic!), but different means really do create different collections of value that don’t fully overlap (fine, I’ll actually lay off the wine because the doctor put the fear of the lord in me). I guess the optimistic case is, with the rote mechanical aspects automated away, maybe humans have more time to give each other the residual human element… [0] https://news.ycombinator.com/item?id=47287344 https://news.ycombinator.com/item?id=47287344
  - sayamqazi 7mo ago
    > How many of us have a reminiscence that starts “looking back, the most life-changing part of my primary or secondary education was ________,” For me it was a website with turotirals on how to make flash games. It literally launched my career and improved the quality of life for my whole family by an order of magnitude. I am primarily the naysayer of AI but I admit that current LLMs could have easily replicated the whole website.
Finnucane 7mo ago
If I described my symptoms to an AI and it suggested a diagnosis, I would defintely get a second opinion.
- mullingitover 7mo ago
  That's reasonable, but don't feel like you're safe letting the humans rest on their laurels. Human medical errors kill thousands upon thousands every year.
NetMageSCW 7mo ago
I feel like lobster’s history might be relevant here - will at some point having a flawed forgetful human being give medical advice be for poor people?

mcmcmc 7mo ago

I’m sick of this idea that “free” services are beneficial to society. There is no such thing as a free lunch; users are essentially bartering their time, attention, IP (contributed content) and personal/behavioral data in exchange for access to the service. By selling those services at a cost of “free”, hyperscalers eliminate competition by forcing market entrants to compete against a unit price of 0. They have to have a secondary business to subsidize the losses from servicing the “free” users, which of course is usually targeted advertising to capitalize on the resources paid by users for access. Or simply selling to data brokers. With the importance of training data and network effects, “free” services even further concentrate market power. Everyone talks about how AI is going to take away jobs, but no one wants to confront how badly the anticompetitive practices in big tech are hurting the economy. Less competition means less opportunity for everyone else, regardless of consumer benefit. The only way it works if the “free” service for tutoring or healthcare is through government subsidies or an actual non-profit. Otherwise it’s just going to concentrate market power with the megacorps.

hn_acc1 7mo ago
This 1000x. "Free" is only a viable business model if the govt funds it. Otherwise, the $$ has to come from somewhere else in the company - how long will it take for the company to lose interest in a loss-leader when they're making $$ from other parts? Look at all the deprecated Google products. What happens when Gemini-SaaS makes billions from licensing to other companies, and Gemini-Charity-for-the-poors starts losing money? Sadly, the bigger the $$ in the tech pie, the more we have attracted robber barons, etc.
drnick1 7mo ago
> I’m sick of this idea that “free” services are beneficial to society. There is no such thing as a free lunch; users are essentially bartering their time, attention, IP (contributed content) and personal/behavioral data in exchange for access to the service. In aggregate, this is true, but there are many ways to game the system to one's advantage and get a true "free lunch." For example, people watching Youtube with an adblocker and logged out don't provide Google with any income or useful telemetry. Likewise you can get practically unlimited GPT/Claude/etc by using multiple accounts.

whatshisface 7mo ago

By the time it replaces doctors, nobody but today's investors will be able to afford anything at all. The X-shaped economy would have owners in the V and manual laborers (assuming this doesn't translate to gains in automation) in the ^. This outcome is worth avoiding...

nine_k 7mo ago

Can a robot write a medicine prescription? A medical procedure prescription? If yes, that would be a game-changer. But the medical insurance providers would be very cautious about honoring these. Then, if things go wrong, what entity would be held accountable for malpractice? You already can get a good-quality medical advice "for nothing", unless it requires e.g. a blood test. The question is, how actionable such an advice is going to be, and how even the quality is going to be.

program_whiz 7mo ago
There's a simple solution. If a medical malpractice happens, law suit against the LLM company. If their license is revoked as part of that finding, unfortunately that applies to the "doctor" (e.g. ChatGPT). Same for self-driving. Just hold each car like a normal driver, the owning AI company has liability. So after ~20 tickets and accidents in a week, a few ambulances being blocked, the only option is to revoke the driver's license (of which, all the cars share one, as they have the same brain). This would make AI companies more cautious and only advertise capabilities they actually have and can verify. They would be held to the standard of a human. I think that's reasonable (why replace humans if the outcome is worse, and why reduce protections for individuals). To make the analogy more clear: even if a telemedicine doc sees 10,000 patients a day all over the world, they would be held liable for any medical malpractice. Bad enough, and their license would be revoked, regardless of the fact that they see many patients all over the world. Same deal with AI / LLM -- if ChatGPT is making medical advice and it hurts someone, that's the same as a human doing so -- its malpractice and lawsuits can happen. If they are somehow licensed, well then that license can be revoked. We would revoke a human's license for a single offense in some cases, the same should occur with AI.

kurthr 7mo ago

You're implying that insurance companies will allow prices to fall and lower their profits. That seems like a really unlikely event in the current economy. They fire a lot of doctors and nurses, but they won't lower prices.

xeromal 7mo ago
This is assuming no competition materializes from the lowered friction
skybrian 7mo ago
The ACA requires 80-85% of health insurance to go toward medical care (medical loss ratio). The way they work around that is to figure out how to charge more for medical care.
- kurthr 7mo ago
  Exactly my point.

jacquesm 7mo ago

Well, there's always wars as the way to get rid of people. I really don't rule out that the people that benefit from this sort of thing will purposefully steer the world in that direction because the poor won't have any choice other than to enlist as a way out of their situation, and never mind the consequences. You can already see some of this happening.

scubadude 7mo ago

> high quality medical advice I'll replace my doctor with AI immediately after the tech bros do lol

bumby 7mo ago

>If you can get high quality medical advice for effectively nothing This is an area where a confident, but wrong information is extremely costly. It’s like saying an LLM can give you high quality directions on how to tap into a high voltage transformer. Sure, but when it’s wrong, it’s very very wrong with disastrous consequences. That’s why professions like doctors and Engineers are more regulated than others.

NetMageSCW 7mo ago
It is definitely too early to expect AI medical advice to be usable (except in very limited instances) but the question is how long and how far will that change? After all, human doctors don’t do so well with new or under documented or rare conditions (consider the history of alpha-gal allergy or lyme disease sufferers even now).

ndr42 7mo ago

I'm not certain that a already observable negative impact of AI on some areas of education could be offset by "high quality individualized tutoring for free".

philistine 7mo ago

I didn’t know Claude Code could put a thermometer in my butt.

NetMageSCW 7mo ago
No human doctor needs to do that either - today, they just IR scan your temple or forehead. In a dedicated medical environment, there’s no reason that couldn’t automatic be fed into the AI.
- philistine 7mo ago
  I didn’t know Claude Code could put an IR scanner to my forehead.

tsss 7mo ago

You could get high quality medical advice 20 years ago on the internet, or 40 years ago in the library. Doctors aren't there to give you advice, they are mostly gate keepers. Every person who's chronically ill knows that doctors are totally useless for anything beyond the 10 most common diseases and primarily exist to approve or reject your pleas for lab work. They won't go away, neither will psychotherapists and all the middle managers that can be easily automated, because their real purpose is not the practical work that they do.