[00:00:00] Intro: Forget the civilized path. It’s time to break the chains of debt and dependency, take control of our financial lives, and live free. This is the Fiscally Savage Podcast.

[00:00:15] Dylan Bain: Welcome back to Fiscally Savage Podcast where we talk about all things money and investing. I’m your host, Dylan Bain. And today, we’re gonna be discussing something a little different. We’re gonna be talking about ChatGPT, a language model developed by OpenAI. So, let me give you a little background on what ChatGPT is. It’s a machine-learning model that’s been trained on a massive amount of text data. It’s able to generate text that’s almost indistinguishable from text written by a human. Now, you might be thinking: why do I care about this on the Fiscally Savage Podcast? Well, ChatGPT has a lot of potential applications in the financial industry. For example, it could be used to generate financial reports, trade ideas, even customer service responses. But it’s not just limited to the financial industry. ChatGPT can be used in a variety of industries, including healthcare, retail, even creative writing. Now, I know some of you might be worried about the implications of a machine being able to write like a human. But let me remind you that ChatGPT is just a tool. It’s up to us as humans to decide how to ethically and responsibly use it. So, that’s today’s episode on ChatGPT. I hope you found it as interesting as I did. Remember to stay fiscally savage and always think about the implications of new technologies before jumping on the bandwagon. Except, ladies and gentlemen, that’s not the end of the episode. Everything I’ve read up to that point was what ChatGPT gave me when I asked for a short script in my style. 

[00:01:49] So, welcome to Fiscally Savage. I am your host, Dylan Bain. It’s gonna be me from here on out rather than a machine writing in my style for me except the places where I’m gonna ask it questions and report back to you what it says. So, let’s get into it. What is ChatGPT? Well, what I read at the beginning of the show is the output from this chatbot and that’s what it is right now. It is a machine-learning algorithm, also known as an AI or artificial intelligence, that has been given a ton of different like source texts, basically a huge body of work for it to read. And then it goes through and reads and it creates a statistical model on the relationship between words. It’s important to note here though but it does not know the meaning of words yet. So, like if you were to ask it, for example, give me all the colors that don’t have an E in them, it’s gonna give you a list of all the colors but it’s just gonna remove E from the colors ’cause it didn’t fully understand the question because it’s looking for a statistical relationship rather than actually assigning meaning to those words. In my role as a CPA, I actually asked ChatGPT a whole bunch of accounting questions, you know, make me a journal entry here, what do you think of this particular financial disclosure? And it uniformly got them all wrong but it gave me answers that sounded like brilliant bullshit. And that I think is very telling. See, the model was only trained on a limited data set, and this is only version three. Version four, which is already under development, is being trained on a dataset that is a factor of 100 times larger. 

[00:03:27] And so, ladies and gentlemen, it behooves us to understand what’s actually being said here in the news and how it might actually work out for us as individuals. Because let’s be real. ChatGPT is impressive but it’s not the only kid on the block. It came out. It made a big splash. Jordan B. Peterson talked about it. It was on Joe Rogan. There’s tons of different people — this is basically the talk of the town. But there are other machine-learning algorithms that can produce art, that can produce comics, that can generate code, that can make movies. These different tools are in an ecosystem where there is a race within the economy and internationally between countries to develop the first truly general AI. And what makes ChatGPT different is that it’s specialized strictly on these language things. It couldn’t actually do something like drive your car because it’s not a general AI. It’s a very specific and targeted AI. But whenever you start talking about automation, so whenever you start talking about any type of technology that can start mimicking things that humans do, the first place most people’s mind go is their job. And that’s where it’s not gonna get pretty, ladies and gentlemen. For sure ChatGPT is gonna create a ton of efficiencies. And as the technology continues to mature, I don’t think it’s outside the realm of possibility that you will end up talking to these AIs and have no real idea that that’s actually what you’re doing. And there is precedence for this with actual AI researchers falling in love with Russian chatbots because they couldn’t actually tell the difference.

[00:05:08] But I’m getting ahead of myself because what I wanna do is go back to the Industrial Revolution and just kind of look at the state of play at that time. In England at that time, what was happening is people were using water wheels to then churn machines to actually start to create textiles. And that’s typically where industrialization starts is in light industry, specifically textiles. And if you know your history at all, you know what happens next. Some people generate machines that are able to produce cloth in large quantities fairly cheaply. But, of course, there were other people in the economy at that time in England who were very rich and very powerful who didn’t want this. Those were the guilds. And the Weavers Guild is a great example of an institution that had been around for literally hundreds of years that then started threatening the life and property of the people who owned these machines. These are early automations, essentially early robots. And this is where the whole idea that these people would storm into these warehouses and destroy all these frames — that’s what they were calling the machines at the time. And then they would say, well, who told you to do this? Well, Ned Ludd told me to do it. And that’s where the idea of Luddites came from. And what ended up happening in England at the time was that you ended up with a lot of cheap fabric. People were able to afford things they were never able to afford before and some other jobs were created that were tangential to that industry. But what’s important is if you were a weaver, your life got immeasurably worse. Like the weavers didn’t recover. The Weavers Guild doesn’t exist today and it’s not a profession that anyone actually does on a large scale anymore as opposed to what it was. That is to say, those jobs went away. And over time, we can look at the economy and go, well, the economy grew and the Industrial Revolution was incredible. And it was. And it did. But only for some. And that I think is one of the big takeaways. 

[00:07:10] But you don’t have to just believe me in one example. You can go to the Gilded Age here in the United States. And at the time in the Gilded Age, you had what they called robber barons with Standard Oil with John D. Rockefeller. You had the steel industry vertical integration under Andrew Carnegie. You had the railroads under Vanderbilt and so on and so on. And the idea was at the time if we just left the economy alone with no regulations or anything in place, it’ll work itself out. But, of course, if you’ve studied history, you know that’s not true. You know that working conditions were absolutely horrid. Eventually, workers started to unionize and it was a good 30 years of what can be considered warfare almost on a civil war level between industrialists and the people that they hired to keep their workers in line and the workers who were just fed up. And it was the advent of the World Wars that actually really, truly broke us out of that, that enabled us to get to a place where you could have relatively peace between the people who owned the factories and the people who worked in those factories. And I’m gonna be entirely clear here. I’m glossing over like a massive, massive amount of history, but I’m trying to illustrate a point that when newer technologies came on board, like the railroads and the ability to create different types of steel, refrigerated cars, these displaced huge amounts of industries, huge amounts of workers, and created a lot of misery for one side of the population and a ton of wealth for the other. 

[00:08:40] But more contemporarily, you can look at the North American Free Trade Agreement that was signed in the 1990s. Now, for those of you who might have been around at that time, which includes me although I was a little kid at the time, it was hotly debated as to whether or not this was gonna be a good thing or not. Because what ended up happening was when they signed NAFTA, which is the short version for North American Free Trade Agreement, the benefits for society were huge. I mean, the economy grew, incomes on average increased, and as an economy, we really benefited from it. The problem with that story though is that the pain felt by that trade agreement was incredibly acute. Youngstown, Ohio is a great example of this. My own hometown of Kenosha, Wisconsin is a great example of this where factory after factory was shut down and shipped to Mexico or shipped to Canada or shipped to someplace else during a broader globalization effort. And even in my own life, I did an internship when I was in college at a factory in Spring Grove, Illinois that my grandfather had spent 30 years working at. That’s how I ended up there. And when I did my new employee orientation, they boasted about how they’ve never done a layoff. And then 2008 came along. And what did they do? They shut down the factory and moved it to Mexico. So, that pain in that town was felt acutely and that town never recovered. There is no industry there. Most of the people have moved out or migrated on. They are essentially economic migrants. That’s how I ended up in Colorado and why I don’t live in Wisconsin anymore. And the gains that are captured are captured by an increasingly small set of society. And I’ve used this example before. If we have 10 people sitting at a table and there’s one cookie in the middle of the table, we can say on average everybody has a 10th of a cookie and maybe they share that 10th equally. But if they all work really hard and they end up getting 10 cookies on the table and nine of the 10 cookies goes to one guy and everyone else gets to share that last cookie, well, an economist would say, well, you know, the economy grew by a factor of 10. And you can say, well, but nine of the cookies went to this one guy. He captured most of those gains. And the economist would go, yes, but everybody else’s cookie share went from 1/10 to 1/9 so it’s fine. But it’s not fine. It’s not fine because lives are ruined. It’s not fine because when you have depths of despair out in rural communities that used to have factories, used to have industry, NAFTA took those away. The pain was very acute. The gains were captured by a very small group of people who could use their money to make them feel comfortable. 

[00:11:19] And the benefits of NAFTA are indisputable but incredibly diffused. So, when you think about this, and you sometimes will see this chart where you see cars and TVs, electronics, and the prices, even inflation adjusted, are decreasing almost as a function of time from the signing of NAFTA to present. And that’s, of course, because of automation, which has made things cheaper and the ability to ship those jobs to Mexico and bring them back in tariff-free. And so, we as a society have benefited greatly. But the problem, of course, is that on that same graph, you see everything we couldn’t outsource or was extremely difficult to automate or outsource: a college education, childcare, nursing. All those things have skyrocketed over time, which of course shows you that the only reason that those other goods went down in price was because of these free trade agreements. And so, it’s important to understand that yes, it is in fact honest to say that automation and outsourcing has had broad benefits for society that are captured by each and every single one of us. But it’s also true to say that we didn’t necessarily gain as much as we really were hoping to. Other people made off like bandits and the pain that was caused by these things was incredibly acute that destroyed communities and lives. And what’s interesting about NAFTA in particular is that the economists who were really pushing it at the time, and I actually remember debating this in high school, was — well, the economists are saying that the people who ship these jobs overseas and really benefit are gonna help out the people they just unemployed. Economists truly believed that that rising tide, when those people made so much extra money by shipping those factories into much cheaper areas, would look at the towns that they just left and go, yeah, I should really give back to that community. But, of course, that didn’t happen. But the economist truly believed that it was going to. And when I was in college and I was taking my first economic classes to get my CPA, I literally had professor after professor going, well, we don’t understand why they didn’t come back to those communities and reinvest in them with their newfound wealth. It was to them just a complete mystery. 

[00:13:38] And so, I guess the kind of the question then becomes, well, what can we do to prepare for something like ChatGPT to come into the economy? Because we know it’s going to. The benefits and efficiencies are just far too great to ignore. We do know that it’s going to displace people. We do know it’s gonna displace jobs. We do know that we’re about to see another experiment because it’s long been said that the opposite of masculinity is not femininity; it’s technology. As tractors took away the jobs of farm hands and automated machines took away factory jobs, well, we’re now we’re gonna see something completely different. So, what can we do to maybe lessen the blow and get it right this time? So, with that, I think it’s only fair. Let’s just ask ChatGPT. So, I’m gonna quote. Here it is, quote: There are several strategies that can be employed to minimize social unrest when large numbers of people become unemployed. These include: number one, providing a safety net to those who lose their jobs, such as unemployment benefits and retraining programs; number two, investing in infrastructure and other projects that create jobs and stimulate economic growth; number three, implementing policies that promote income equality, such as progressive taxation and a living wage; number four, encouraging the development of new industries and technologies that can create new jobs and opportunities; number five, establish programs to support small businesses and entrepreneurship, which can help spur job creation in the private sector; number six, encouraging companies to invest in automation and technologies that will also provide training to employees in the skills they need to adapt to a changing job market; number seven, improving the education system to ensure that young people are better prepared for the jobs of the future; and number eight, the government and private sector partnership to create jobs and provide retraining for opportunities for the unemployed. It is important to note that the specific solutions will depend on the economic and political context of each country, end quote.

[00:15:38] So basically, I asked ChatGPT, hey, what can be done with the civil unrest that’s no doubtably going to occur as white-collar professionals find themselves not just unemployed but unemployable? And it gave me the stock answers. I mean, do we really believe that our politicians give a shit enough to actually do things like and create this safety net? Or to retrain people? Or that somehow the government and the private sector are gonna get together and actually try to train employees? I mean, cripes! You can’t even get a job, an entry-level job, without 17,000 years of experience and an NBA PhD from Harvard, right? So, like what makes you think that these employers are just gonna go, you know, we should really retrain people. That’s right, ladies and gentlemen. The economists from NAFTA are back. 

[00:16:24] So, what’s my take on this? Because you’re listening to my show and if you wanted to know what ChatGPT says, you could go ask ChatGPT. Well, ladies and gentlemen, the solution to any of these challenges — literally every crisis, every challenge, every worry we have on the horizon typically has the same prescription. Number one: get your financial house in order. Number two: become physically fit. Number three: build a community around yourself of like-minded individuals. And number four: invest in yourself. I don’t know what the future’s gonna look like. I truly don’t. I really wish that I could say that I had some crystal ball and I looked in it and went, yep, ladies and gentlemen, we all decided to be far more rational as human beings than we expected and it turned out great. In fact, what John Maynard Keynes said almost a hundred years ago, where he said that as automation and industrialization increases, the number of hours that people will have to work to get a living wage will decrease probably to only two to three hours a day — that that somehow he was right. But I’m a little bit too cynical to actually believe that. I mean, how often do we moralize the idea of work? And we talk about people having to earn a living as if existing wasn’t enough to actually deserve to do things like eat. I mean, given all people’s pro-life positions, I would think that feeding people would be high on the list but it’s not. And it’s not for a variety of different reasons and those aren’t important to go here now. But it is important to start thinking about what these AI technologies are going to do to our economy and what it’s gonna do to our individual lives. 

[00:18:09] I mean, stop and think about some things that are extremely expensive now, like going to the doctor. Well, the doctor comes in — at least my last primary care doctor came in, set a 15 minute timer, talked to me about some stuff, throw a bunch of prescriptions at me, and walk out the door as soon as the timer went “Ding!” Well, and every time I did that, I had to pay $300 to see her every single time. And if I wanted more than that 15 minutes, I’d have to book two back-to-back appointments. Well, if I could have the machine do it for 20 bucks with the same results, I mean, hell! It’s a machine. I could talk to it for three hours. It could ask me all sorts of questions about my life and how am I sleeping and what are my relationships like, when was the last time I got laid, when was the last time I had a good relaxing holiday, when was the last time I just treated myself, when was the last time I had a good meal, how much processed food do I eat — the machine could spend so much more time with us. But then, what’s the doctor gonna do, right? As these machines get better, the idea that somehow they’re just not gonna start chipping away at certain aspects of people’s jobs is just not believable and especially when you look at it and how we could combine these things together. You take the chatbot to write a script, the voicebot that can mimic anyone’s voice to read the script, the animation bot to create a cartoon to go with it. And then pretty soon, they’re making movies. They’re making YouTube videos. And those YouTube videos get better and better and better to the point where you don’t even know if that person on the screen is real. This is not science fiction anymore. And ChatGPT might have been the one that caught the headlines, but literally every tech company out there is working on this and these bots are coming. So, what does ChatGPT think about this? Quote, it is important to remember that technology has been displacing jobs for centuries but has also led to increasing productivity and economic growth. With the right policies in place, such as retraining programs for workers whose jobs are impacted by AI, we can mitigate the negative effects of AI and employment and take advantage of the benefits it offers, end quote. 

[00:20:15] Ladies and gentlemen, ChatGPT is right. Technology’s been doing this for centuries my entire life, in fact, I’ve watched people lose their jobs. And when I was in public accounting, the partners always used to tell the story about how they were handed a handwritten spreadsheet with all the different numbers and transactions on it for the company and that their entire job was just to foot that one spreadsheet. So, they were handed a calculator and they’d start at the top of the column and they’d add up everything on the one column and then they would go to the next column and add up everything to the other column and if they didn’t match, you’d have to go back and do it again and find where the mistake was. And that took literally all day. Now, they would have legions of first-year accountants who that’s all they would do all day is punch into their 10T calculators and try to figure out whether or not these actual ledgers balanced or not. And, of course, I do all that in Excel. When I first started in public accounting, the presence of a laptop and Excel made me worth, in terms of my productivity, at least 10 other accountants from the 1980s. That means that there are nine other people who should have been around that table who weren’t. And what was comical about that is not that the amount of work that we did as an accounting firm decreased or even stayed steady. It just meant we started doing more and more and more and more. And that’s a lot of what’s going to happen. 

[00:21:46] As the world continues to go towards a more automated future, we have to remember that automation is generally good for the economy and we’re going to produce a heck of a lot more at a much cheaper rate. Now, remember those NAFTA economists who really thought that when somebody took a factory out of the small town rural Wisconsin and sent it someplace else that they would make a bunch of money and then they’d look around and go, wow, I really unemployed a lot of people and I should go help them out? Yeah. Those economists are back telling us the same thing about AI and they were wrong in the nineties and they’re wrong again. The people who employ this technology that own it from a capital side rather than the labor side where most of us participate, they’re gonna reap the benefits of this. And society will only be an incidental beneficiary of this type of technology and a lot of workers are going to get hurt. I don’t think that I’m wrong in pointing out what I think we all know is obvious. And part of the reason that I call the show Fiscally Savage and why I chose the word “savage” is because this type of behavior where one person in society strip-mines value, wealth, and resources out of it and hoards it for themselves, it’s inhuman. It’s antihuman. In a tribal context, we’d all get together and teach that person a lesson. And if they survived, maybe they would learn their lesson and they could be part of the tribe. And if not, well, we won’t miss them. And you understand what I’m saying there. And I’m not advocating that anybody go take some type of direct action and I do not particularly ever want for people to think that I’m endorsing anything violent in any way, shape, or form ’cause I’m not. But I am pointing out that we live in interesting times, which is traditionally considered a curse. To live in normal times and boring times are times in which you can watch your children grow and you don’t worry about it. That’s human flourishing where we can pursue our own interests. And we live in a world where our current level of automation and technology could enable literally every single human being to have a home, have a full belly, be able to pursue the things they want. And we’ve chosen not to do it. We could enter into a world where automation has allowed us to thrive and flourish as human beings, that have brought us closer in community with one another. These AIs could be set to always consider what’s going to help the humans and create something that’s more pro-human over time or we can end up in a world where jobs are scarce and people suffer while others are made monstrously wealthy and can hoard those resources and be untouchable behind their gated communities. We’re gonna have to look in the mirror as a society and ask ourselves some really uncomfortable questions, some hard questions. And that day is gonna come a heck of a lot sooner than you think. And it doesn’t matter if you think, well, the markets will take care of itself. The markets will automate you out of a job without a second thought. And it doesn’t matter if you think, well, government’s always evil. They’re gonna have a role to play, whether it’s going to be keeping you from being able to respond to an automation crisis or having to respond to the automation crisis themselves. I don’t think it’s out of the realm of possibility that they’re going to play an outsized role in this whole thing before long. 

[00:25:06] But I want you to stop and think about how you feel in the face of all of this. Because I’m trying to leave you with some suggestions and some hope but I also don’t want to undersell what a challenge this is going to be, how absolutely uncertain the whole thing is. It may sound scary to you. But at the end of the day, we don’t know how long it’s going to be until all of this stuff becomes commonplace. We don’t know what the impacts are going to be on the individual or societal levels. We don’t know. But we do know how we feel in this moment with the facts that I have laid out and the commentary that I have given. And so, I wanna leave you with this. If you’re sitting there wondering whether or not AI is going to be a positive on your life or not, just start to think about how you feel with the idea that AI is gonna start eating the jobs of you and the people around you. And ladies and gentlemen, however you felt will pretty much tell you which side of the fence you’re actually on.

[00:26:10] Outro: Thanks for listening. If you like what we do here, please hit that subscribe button. Leave us a rating and review. And share the content with somebody who would benefit from the message. You can follow us on Instagram, Facebook, and Twitter, all @fiscallysavage. And head over to fiscallysavage.com to get our free tools, suggested reading, and everything else you need to take control of your financial life and live free.