Most Human Wins

Partial Excerpts (antilibrary)

Jan 2025 - Memorandum on Human Strategy - not boring

Packy McCormick

SUBJECT:       　 MEMORANDUM ON HUMAN STRATEGY, 2025 AND BEYOND

strategy recommendations for those humans who do not wish to lay down and hand the economy to the AIs.

The pie grows. What is true is that there will be winners and losers among humans, and that the divide between the two will be historically wide.

Everyone will have their Lee Sedol moment at a different time,” referring to the Go world champion famously defeated by AlphaGo in 2016

On January 18, 2025, roon quote tweeted a hopeful tweet 14 – “AI helps you figure how to do things, but not what things to do” – by calling that line of thinking: “a common cope among the classes blessed to work on or with ai, but we are not blessed for long. there is no conceptual divide between ‘how to do things’ and ‘what to do’, it’s just zooming in and out. smarter models will take vaguer directives and figure out what to do.”

God is not in the gaps. God is in the layers

In three to four years, AI may be able to do everything that humans currently do to produce economic value. Humans, then, will move to higher layers

Novel experiences are the human currency. Like the universe, they are infinite and expanding.

Certain units of work – the ability to answer questions, write code, and solve math problems, for example – have always been commodities – ”an economic good” or “something useful or valued” 16 - but to date, they have been acquirable only as part of the human “bundle.”

If you follow a playbook 17 or provide discrete inputs to a larger, predetermined output, you may be in trouble

A challenge the Council must face is that this is exactly the type of skills we have oriented the system to develop over the past two centuries

since the Industrial Revolution, the trend has been towards turning the world into machines in which humans are cogs

In order to increase universal prosperity and human flourishing in the future, it is critical to reverse this trend. We must de-industrialize the human, a subject, perhaps, for a future memorandum

As certain skills get cheaper and more abundant, value doesn’t disappear. Value moves to a higher layer of the stack, and increases

Smart companies try to commoditize their products’ complements.

Observe Commoditization and Position as a Complement

Henry Ford, then, took Rockefeller’s product as a commoditized   input to fuel the growth of the auto industry! Others then took   the car as a commoditized input to create newly possible things,   like suburbs and drive-ins! This is how the world moves

As Thompson writes, “ More broadly, breaking up a formerly integrated   system — commoditizing and modularizing it — destroys incumbent value   while simultaneously allowing a new entrant to integrate a different   part of the value chain and thus capture new value

Hamilton Helmer’s 7 Powers 29 can be read as defenses against the effects of commoditization

The takeaway is this: businesses succeed by positioning themselves as complements to commoditized inputs earlier and better than others.

What is not obvious with AI is that it really is a complement to what humans do, and not a substitute, as its capabilities grow. You do not want the cost of your substitute to decrease.

If AI becomes PhD-level intelligent, all the better. Most PhDs work for other people

There is actually a job title for a complement to smart units of work: entrepreneur

people and businesses are increasingly interchangeable strategic units.

software also allows smaller groups of humans to compete with businesses.

W ithin two decades, we will have multiple trillion-plus   dollar publicly traded entities with just one full-time   employee, the founder

In his 1980 classic Competitive Strategy 33 , Michael Porter 34 , considered the father of modern business strategy, wrote that there are three generic strategies:

1. Overall Cost Leadership
2. Focus
3. Differentiation

Only one of these is reliably available to humans vis a vis economic competition with AI: Differentiation

If the Institute could make you remember only three words from this memorandum, they would be: Most Human Wins

Put another way, as AI commoditizes certain narrow forms of intelligence, or units of work, substitutes for those commodities will get demolished, while their complements thrive.

To zig when they zag. To go IRL when they go URL. To love when they calculate. To constantly, always, take whatever you can get from the click of a button and subsume it in the name of your greater mission.

*The One Strategy  *

there is really only one strategy for dealing with commoditization: Move Up the Stack

Don’t just move up the stack; run up the stack

Gwern calls commoditizing your complement “an alternative to vertical integration”

This is the law of conservation of attractive profits with an upward vector, too.

As the gap between idea and execution shrinks 39 , ideas become more valuable . This is because the ideas layer can take newly commoditized execution capacity as an input

distribution, audience, community, network – the ability to get a product in front of people in a differentiated way all become

more valuable as the products themselves become more commoditized

Lost in the conversations about AI’s impending takeover of economic value creation is the question, “What is valuable?”