Embrace AI to kickstart 4th industrial revolution

• Widespread concerns about the impact of AI on jobs are driven by the Luddite Fallacy: assuming that robots and workers are competing for a fixed number of jobs in a static economy.

• Estimates suggest as many as 40% of jobs are at high risk of automation.  However these projections vary widely and are unclear on actual job losses or timelines. This creates unnecessary fear around the technology and fails to look at the net impact on employment.

• AI could mean a 4th Industrial Revolution, boosting innovation from driverless vehicles to accelerated vaccine development. 

• AI is critical to boosting the UK economy post COVID-19, creating new jobs, boosting productivity and increasing purchasing power.

• £1 billion of the Department for Work & Pensions’ circa £175 billion budget should be used to fund policy experiments in welfare such as a lifelong learning voucher scheme or a Negative Income Tax to allow people displaced in jobs to find new training and employment.

• To remove regulatory barriers to technological progress, the Government should set up a £5 million ‘Office for removing barriers to Artificial Intelligence’ (ORBI) and pass an ‘Unleashing Artificial Intelligence Act’ (UAI Act).

• UK Government should expressly rule out populist and unworkable Robot Taxes.

Over the last decade, artificial intelligence (AI) research and development has surged. This has been driven by the wider adoption of machine learning techniques in business, hardware improvements, and a greater willingness to invest. In the last six years, over three thousand AI startups have received venture capital funding, totalling over $66 billion.

With this rise though have come calls for restraint in the development of AI and warnings about the consequences of the technology’s adoption. This includes concerns about a full-scale apocalypse driven by AI. Science and technology leaders like the late Stephen Hawking, and Elon Musk even have warned of an existential threat to humanity. Other doomsayers also assert a more imminent threat: AI will bring the collapse of our economic order, driven by mass unemployment.

A new paper by the free market think tank the Adam Smith Institute argues that these worries are unfounded and predicated upon a well established mistake: the Luddite Fallacy. 

The economy is often thought of in static terms. This means people assume that robots and people are competing for a fixed number of jobs. It feels intuitive:  if work that

used to be completed manually is now automated, there is less need to employ a person. Moreover, if many positions are automated, this suggests that displacement of existing workers will result in mass unemployment and wage reductions. If large numbers of jobs are at high risk of automation from AI then the result would be widespread unemployment.

But this analysis is fatally flawed.  There is no finite number of jobs. As old jobs, especially dull and mundane ones are automated, new and better jobs can be created.

People can be paid better and do more interesting work. We can use labour resources more efficiently and to generate greater economic value. It is easy, the report’s author argues, to see how work is being automated but harder to conceive of the new opportunities and future jobs. It’s also easier for politicians to blame others (competitor countries, technologies, immigrants, etc.) than to focus on creating an environment that facilitates job creation.

Nevertheless, there is still a need to consider how AI could change the nature of the labour market. There is consensus about the huge scope for automation. However, the report argues, there is a lack of precise forecasts and a lack of recognition that losses because of automation do not necessarily translate to significant unemployment, as it will take time for businesses to adopt AI and new jobs will be created. 

Technology progresses faster than regulation, creating a ‘pacing problem,’ while a regulatory vacuum hinders progress in technology. The precautionary approach feeds this vicious cycle, but the think tank argues it can be fixed by the implementation of a permissive regulatory environment, like the UK has pursued in fintech, or which Estonia has now for AI.

The Government’s announcement of a new centre dedicated to artificial intelligence as part of a Defence spending boost last week is welcomed by the think tank but it warns that the UK is not currently positioned to lead in AI or ready to address the potential jobs impact from its implementation.

The report argues that the Government should set up a £5 million ‘Office for removing barriers to Artificial Intelligence’ (ORBI) and pass an ‘Unleashing Artificial Intelligence Act’ (UAI Act). The Office would remove impediments to artificial intelligence and make permissionless innovation the legal default. This approach could be expanded to other areas of regulation.

The report suggests the Government should set aside £1 billion of the Department for

Work & Pensions £175 billion budget, to enable policy experiments such as a lifelong learning voucher system or trials of a Negative Income Tax. 

Poorly thought out populist policies such as Robot taxes should be rejected utterly. They are poorly conceived, would hinder progress, and would be ineffective in a globalised economy already making mass use of technology in the workplace. An ideal tax is targeted at an activity that we want to discourage; technological advancement is no such activity.

Discouraging the use of robots would limit gains in productivity and overall output, making us all worse off. The Adam Smith Institute argues that it would be better to embrace higher output, and if necessary, redistribute afterwards once we are wealthier through more general increases in revenue.

AI has the potential to transform our world, but only for the better if it is embraced rather than resisted. Technological progress is key to growth and increased overall prosperity is the most likely scenario as AI develops, the think tank argues. 

Report author and ASI Fellow James Lawson, says:

“I know first hand AI’s huge potential to transform our lives for the better, creating jobs and driving innovation. 

“We should address people’s concerns about the impact on jobs, without resorting to excessive doom and gloom. The most likely scenario is that AI will create more jobs that it destroys, make us more prosperous and enable us to help anyone who loses out.

“The Government’s announcement last week of a dedicated AI centre is positive, but there is much more work to do if we really want to boost our economic recovery and position the UK for global AI leadership.”

Notes to editors:  

For further comments or to arrange an interview, contact Matt Kilcoyne: matt@adamsmith.org | 07904 099599.

James Lawson is a Fellow of the Adam Smith Institute. This paper is written in a personal capacity.

The Adam Smith Institute is a free market, neoliberal think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

Rishi cannot tax our way out of debt or spend our way out of a recession — Adam Smith Institute

Following the spending review by the Chancellor, the Adam Smith Institute’s Deputy Director Matt Kilcoyne criticises the public sector spending splurge:

“The Chancellor set out plans for big-spending and big-borrowing to get the country through the pandemic, and set the course for the country in the years ahead. It is necessarily expensive to confront the Covid-19 pandemic. But this public sector spending splurge fails to put the United Kingdom onto a strong fiscal footing for the recovery. Rishi Sunak cannot tax our way out of debt or spend our way out of a recession. 

“Increasing departmental budgets as the economy shrinks is just spending money we don’t have. It is fair that while private sector wages have fallen, public sector wages do not rise. Every public sector worker does not automatically deserve a pay rise while the rest of the UK loses out. 

“Raising the minimum wage during a recession will hit the most vulnerable the hardest by preventing businesses from hiring out-of-work Brits. It risks fewer jobs and hours for the lowest skilled, young, and minority workers. For the party of business, the lack of thought about their needs and the increase in costs they’re facing coming from the government, this is a massive and unforgivable oversight.”

For further comment or to arrange an interview, please contact Matt Kilcoyne via matt@adamsmith.org or 07904099599

UK Free Speech Under Threat

Government should introduce a United Kingdom Free Speech Act modelled on the First Amendment of the USA

• Existing laws, as applied, have created categories of “speech crimes” for offensive but otherwise benign political speech.

• There is mounting evidence that existing law is capable of being applied, and is actually applied, in an overbroad fashion which was not contemplated by its drafters.  e.g. the treatment of Darren Grimes in June of this year

• The poor drafting of existing law means that as social attitudes shift, broader categories of speech are criminalized as “offensive,” “distressing” or “hateful.” 

• British citizens face emerging threats to freedom of expression posed by the Law Commission and “Online Harms” proposals, as well as the Hate Crime (Public Order) (Scotland) Bill. 

• Scottish Hate Crime Bill threatens sharing of potentially offensive Internet memes and freedom of speech in the home

A new paper released by free market think tank the Adam Smith Institute argues that freedom of expression is under significant and severe threat in the United Kingdom, both at the Westminster level and with a Bill currently progressing through the Scottish Parliament.

The think tank argues that there should be no right to not be offended, no right to prevent others from expressing ideas that one finds uncomfortable or dislikes, in positive law. With online life becoming everyday life for most people overreaching legislation risks snuffing out free speech, with the report author arguing that “the only way free inquiry will survive is if the police have no role in the regulation of political speech.” 

Freedom of expression is fundamental to life in a free and democratic society. It reflects our underlying moral right to think and express ourselves, even when it offends, disrespects or annoys others. It is, the Adam Smith Institute argues, what allows us to be individuals and the ability to express contrarian ideas allows us to explore controversial and important topics and strive for better understanding of the challenges we face. Censorship impedes this process.

Currently the UK has significant challenges to freedom of expression via the Public Order Act 1986, Communications Act 2003, Section 127 and Malicious Communications Act 1988, Section 1. The think tank argues that proposals by the Law Commission, the Hate Crime (Public Order) (Scotland) Bill, and ‘Online Harms’ in discussion at Westminster represent emerging threats to the principle. 

Both these existing laws and the new ones under discussion go against the British principles regarding free speech built up in political and legal case law that guard freedom of expression “not only to ‘information’ or ‘ideas’ that are favourably received or regarded as inoffensive or as a matter of indifference, but also to those that offend, shock or disturb the State or any sector of the population.” (Handyside v. United Kingdom, App. No. 5493/72.) 

Dramatic action is required if the UK’s rapidly-evolving statutory speech regime is

to avoid being used as a sledgehammer to crush dissent, the report’s author argues, saying that Parliament should create an “inviolable liberty that protects political expression of any type that falls short of direct incitement from state interference.” 

The report lists a number of cases raised in recent years that have raised eyebrows over the scope of free speech in the UK including: 

• Bethan Tichborne, who was convicted of a public order offence for yelling at then-Prime Minister David Cameron, at a public event, that he had “blood on his hands” for cutting disability living allowance.

• In 2014, Eurosceptic EU Parliament candidate Paul Weston, who was arrested on suspicion of violating the Public Order Act for quoting Winston Churchill verbatim. 

• Darren Grimes, a conservative commentator, who in this year was investigated and threatened with an interview under caution by the Met for having conducted an interview with historian David Starkey in which Starkey — not Grimes — made highly offensive comments about slavery. After public outcry the investigation was dropped.

All of these individuals were subjected to mandatory interactions with law enforcement pursuant to the provisions of the Public Order Act 1986, which the think tank argues  excessively criminalizes offensive speech. 

The Report is especially cogent for Scotland where the Hate Crime Bill is currently going through the Scottish Parliament. The think tank recommends that Scottish Parliamentarians remove references in the Bill to “insulting” material and the word “abusive” in response to the experience of English magistrates in using and overbroad and imprecise use of the terms. The report’s author also recommends defining precisely the terms “threatening” in the proposed law to avoid cases arising where highly offensive but non-threatening speech meets a highly sensitive listener.

Meanwhile at Westminster the debate over Online Harms continues to raise substantial free speech concerns with the “Duty of Care” requirement for online companies that allow their users to interact with one another unsupervised. This would, the report author argues, “impose a duty on interactive computer service providers to prevent users’ feelings from being hurt.”

Much of the substance of both bills is already covered under existing legislation (including legislation covering terrorism and child sexual abuse) but the Government’s inclusion of ‘legal but harmful’ under the proposals risks creating an expansive, and poorly-defined, set of speech, with no legal definition, that an independent government regulator could deem “harmful” and force online service providers to remove from the Internet. 

To resolve the growing threats to freedom of expression, the Adam Smith Institute argues that Parliament should immediately:

1. Remove all references to “abusive” or “insulting” words and behaviour from Parts I and III of the Public Order Act 1986;

2. Replace the Section 127 of the Communications Act 2003 with (a) a provision that limits the scope of the existing rule to “threatening” only and (b) a new rule that addresses meaningful stalking and cyberstalking threats which cause or intend to cause substantial emotional distress, modelled after 18 U.S. Code § 2261A;

3. Repeal the Malicious Communications Act 1988 and replace it with a stalking statute; and

4. Introduce a United Kingdom Free Speech Act.

Report author and Legal Fellow at the Adam Smith Institute Preston J. Byrne  said:

“Basic political liberties including freedom of speech have been progressively eroded in the United Kingdom since 1997. Currently the Scottish Parliament and the Law Commission propose speech regulations which would be a more natural fit for Orwell’s Airstrip One than Churchill’s England. The sun is setting on the Enlightenment, and if Parliament does nothing to preserve free speech now we may lose it for generations.”

Andrew Rosindell M.P. said:

“Throughout history, societies have disagreed about the path forward. Ultimately there are two ways of resolving disagreements: violence, or free and open debate.

“For centuries our great nation has navigated choppy waters because of our commitment to the latter. With the flourishing of a free press, free speech, and a free economy, this nation has gone from strength to strength.

“The battle to preserve free speech is one every generation must fight. I fear that at the moment we are not doing enough to win this battle, as extremists from both ends attempt to stifle open inquiry. I fully endorse the work of organisations such as the Adam Smith Institute to re-examine our laws and norms in this matter of vital importance."

Darren Grimes, said:

“I back this vital Adam Smith Institute report and argue that the police investigation into an interview broadcast on my channel, with threat of arrest, should terrify anyone that cares about freedom of expression. This was an unprecedented use of public order legislation to target a member of broadcast media.

“As the report argues, through its current crop of laws, the United Kingdom is placing power in the hands of the easily offended, who can silence their opponents by threatening to report them to the police for daring to express unpopular opinions, challenge consensus or for daring to have uncomfortable conversations. This places an obvious chilling effect upon free, open and robust dialogue. 

“In the Miller v Humberside and College of Policing in the High Court earlier this year, a Judge likened police action over a tweet to the Stasi, the Cheka and the Gestapo. We can reverse this dangerous trend and restore trust and confidence in British policing by amending the law and reducing the police’s ability to criminalise people for expressing a view.

“Let’s get the law back to policing our streets, not our tweets.” 

Notes to editors:  

For further comments or to arrange an interview, contact Matt Kilcoyne: matt@adamsmith.org | 07904 099599.

The Adam Smith Institute is a free market, neoliberal think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

Fives Eyes at the front of the queue for trade

Following the news of the Canada-UK rollover and announcement of a bespoke FTA to be negotiated in 2021, Deputy Director Matt Kilcoyne said:

"The days of being told continuity and bespoke deals in record time would be beyond the capability of the UK are long gone. This deal is a sensible stop-gap but the bigger news is the confirmation of a bespoke free trade agreement to be negotiated next year. Canada joins the rest of our Five Eyes allies now firmly at the front of the queue. As we leave the EU we find firm friends welcoming Britain on the global stage."

For further comment or to arrange an interview, please contact Matt via matt@adamsmith.org or 07904099599

Not getting to grips with the virus is costing country dearly

In response to the Chancellor of the Exchequer's expansion of corporate welfare into the Spring Matthew Lesh, Head of Research at the Adam Smith Institute, said:

"The failure to control the virus is costing the country dearly. Consumer activity is falling as case numbers rise and lockdowns are instigated. We risk firm after firm failing and a cascading credit crunch as unpaid debts mount up.

"The Chancellor’s furlough extension is to avoid unnecessary economic scarring; however, it also risks propping up companies that are not profitable in the longer run. At some point, we must allow the economy to adjust, firms to fail and new ventures, and new jobs.

"The Chancellor should immediately release, and if it does not yet exist commission, the underlying economic modelling to justify these decisions. The shroud of secrecy must come to an end."

For further comment or to arrange an interview, please contact Matt Kilcoyne via Matt@adamsmith.org or 07904099599.