Artificial Intelligence, Automation, and the Economy
Summary:
Today, the White House released a new report on the ways that artificial intelligence will transform our economy over the coming years and decades.
Editor’s Note: Staff from the Council of Economic Advisers, the Domestic Policy Council, the National Economic Council, the Office of Management and Budget, the Office of Science and Technology Policy contributed to this post.
Today, in order to ready the United States for a future in which artificial intelligence (AI) plays a growing role, the White House released a report on Artificial Intelligence, Automation, and the Economy. This report follows up on the Administration’s previous report, Preparing for the Future of Artificial Intelligence, which was released in October 2016, and which recommended that the White House publish a report on the economic impacts of artificial intelligence by the end of 2016.
Accelerating AI capabilities will enable automation of some tasks that have long required human labor. These transformations will open up new opportunities for individuals, the economy, and society, but they will also disrupt the current livelihoods of millions of Americans. The new report examines the expected impact of AI-driven automation on the economy, and describes broad strategies that could increase the benefits of AI and mitigate its costs.
AI-driven automation will transform the economy over the coming years and decades. The challenge for policymakers will be to update, strengthen, and adapt policies to respond to the economic effects of AI.
Although it is difficult to predict these economic effects precisely, the report suggests that policymakers should prepare for five primary economic effects:
- Positive contributions to aggregate productivity growth;
- Changes in the skills demanded by the job market, including greater demand for higher-level technical skills;
- Uneven distribution of impact, across sectors, wage levels, education levels, job types, and locations;
- Churning of the job market as some jobs disappear while others are created; and
- The loss of jobs for some workers in the short-run, and possibly longer depending on policy responses.
There is substantial uncertainty about how strongly these effects will be felt and how rapidly they will arrive. It is possible that AI will not have large, new effects on the economy, such that the coming years are subject to the same basic workforce trends seen in recent decades—some of which are positive, and others which are worrisome and may require policy changes. At the other end of the range of possibilities, the economy might experience a larger shock, with accelerating changes in the job market, and significantly more workers in need of assistance and retraining as their skills no longer match the demands of the job market. Given available evidence, it is not possible to make specific predictions, so policymakers must be prepared for a range of potential outcomes. At a minimum, some occupations such as drivers and cashiers are likely to face displacement from or a restructuring of their current jobs.
Because the effects of AI-driven automation will be felt across the whole economy, and the areas of greatest impact may be difficult to predict, policy responses must be targeted to the whole economy. In addition, the economic effects of AI-driven automation may be difficult to separate from those of other factors such as other forms of technological change, globalization, reduction in market competition and worker bargaining power, and the effects of past public policy choices. Even if it is not possible to determine how much of the current transformation of the economy is caused by each of these factors, the policy challenges raised by the disruptions remain, and require a broad policy response.
In the cases where it is possible to direct mitigations to particularly affected places and sectors, those approaches should be pursued. But more generally, the report suggests three broad strategies for addressing the impacts of AI-driven automation across the whole U.S. economy:
- Invest in and develop AI for its many benefits;
- Educate and train Americans for jobs of the future; and
- Aid workers in the transition and empower workers to ensure broadly shared growth.
The report details what can be done to execute on these strategies. Continued engagement between government, industry, technical and policy experts, and the public should play an important role in moving the Nation toward policies that create broadly shared prosperity, unlock the creative potential of American companies and workers, advance diversity and inclusion of the technical community in AI, and ensure the Nation’s continued leadership in the creation and use of AI.
Beyond this report, more work remains, to further explore the policy implications of AI. Most notably, AI creates important opportunities in cyberdefense, and can improve systems to detect fraudulent transactions and messages.
He is less focused on a specific threat—a quake on
the San Andreas, a pandemic, a dirty bomb—than he is on the aftermath, “the
temporary collapse of our government and structures,” as he puts it. “I own a
couple of motorcycles. I have a bunch of guns and ammo. Food. I figure that,
with that, I can hole up in my house for some amount of time.”
Survivalist, the practice of preparing for a
crackup of civilization, tends to evoke a certain picture: the woodsman in the
tinfoil hat, the hysteric with the hoard of beans, the religious doomsayer. But
in recent years survivalist has expanded to more affluent quarters, taking root
in Silicon Valley and New York City, among technology executives, hedge-fund
managers, and others in their economic cohort.
Last spring, as the Presidential campaign exposed
increasingly toxic divisions in America, Antonio García Martínez, a forty-year-old
former Face book product manager living in San Francisco, bought five wooded
acres on an island in the Pacific Northwest and brought in generators, solar
panels, and thousands of rounds of ammunition. “When society loses a healthy
founding myth, it descends into chaos,” he told me. The author of “Chaos
Monkeys,” an acerbic Silicon Valley memoir, García Martínez wanted a refuge
that would be far from cities but not entirely isolated. “All these dudes think
that one guy alone could somehow withstand the roving mob,” he said. “No,
you’re going to need to form a local militia. You just need so many things to
actually ride out the apocalypse.” Once he started telling peers in the Bay
Area about his “little island project,” they came “out of the woodwork” to
describe their own preparations, he said. “I think people who are particularly
attuned to the levers by which society actually works understand that we are
skating on really thin cultural ice right now.”
In private Facebook groups, wealthy survivalists
swap tips on gas masks, bunkers, and locations safe from the effects of climate
change. One member, the head of an investment firm, told me, “I keep a
helicopter gassed up all the time, and I have an underground bunker with an
air-filtration system.” He said that his preparations probably put him at the
“extreme” end among his peers. But he added, “A lot of my friends do the guns
and the motorcycles and the gold coins. That’s not too rare anymore.”
Tim Chang, a forty-four-year-old managing director
at Mayfield Fund, a venture-capital firm, told me, “There’s a bunch of us in
the Valley. We meet up and have these financial-hacking dinners and talk about
backup plans people are doing. It runs the gamut from a lot of people stocking
up on Bitcoin and cryptocurrency, to figuring out how to get second passports
if they need it, to having vacation homes in other countries that could be
escape havens.” He said, “I’ll be candid: I’m stockpiling now on real estate to
generate passive income but also to have havens to go to.” He and his wife, who
is in technology, keep a set of bags packed for themselves and their
four-year-old daughter. He told me, “I kind of have this terror scenario: ‘Oh,
my God, if there is a civil war or a giant earthquake that cleaves off part of
California, we want to be ready.’ ”
When Marvin Liao, a former Yahoo executive who is
now a partner at 500 Startups, a venture-capital firm, considered his
preparations, he decided that his caches of water and food were not enough.
“What if someone comes and takes this?” he asked me. To protect his wife and
daughter, he said, “I don’t have guns, but I have a lot of other weaponry. I
took classes in archery.”
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“I released a lot of emotion with my drumming, but
I still need to have a tantrum.”
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For some, it’s just “brogrammer” entertainment, a
kind of real-world sci-fi, with gear; for others, like Huffman, it’s been a
concern for years. “Ever since I saw the movie ‘Deep Impact,’ ” he said. The
film, released in 1998, depicts a comet striking the Atlantic, and a race to
escape the tsunami. “Everybody’s trying to get out, and they’re stuck in
traffic. That scene happened to be filmed near my high school. Every time I
drove through that stretch of road, I would think, I need to own a motorcycle
because everybody else is screwed.”
Huffman has been a frequent attendee at Burning
Man, the annual, clothing-optional festival in the Nevada desert, where artists
mingle with moguls. He fell in love with one of its core principles, “radical
self-reliance,” which he takes to mean “happy to help others, but not wanting
to require others.” (Among survivalists, or “preppers,” as some call
themselves, fema, the Federal Emergency Management Agency, stands for
“Foolishly Expecting Meaningful Aid.”) Huffman has calculated that, in the
event of a disaster, he would seek out some form of community: “Being around
other people is a good thing. I also have this somewhat egotistical view that
I’m a pretty good leader. I will probably be in charge, or at least not a
slave, when push comes to shove.”
Over the years, Huffman has become increasingly
concerned about basic American political stability and the risk of large-scale
unrest. He said, “Some sort of institutional collapse, then you just lose
shipping—that sort of stuff.” (Prepper blogs call such a scenario W.R.O.L.,
“without rule of law.”) Huffman has come to believe that contemporary life
rests on a fragile consensus. “I think, to some degree, we all collectively
take it on faith that our country works, that our currency is valuable, the
peaceful transfer of power—that all of these things that we hold dear work
because we believe they work. While I do believe they’re quite resilient, and
we’ve been through a lot, certainly we’re going to go through a lot more.”
In building Reddit, a community of thousands of
discussion threads, into one of the most frequently visited sites in the world,
Huffman has grown aware of the way that technology alters our relations with
one another, for better and for worse. He has witnessed how social media can
magnify public fear. “It’s easier for people to panic when they’re together,”
he said, pointing out that “the Internet has made it easier for people to be
together,” yet it also alerts people to emerging risks. Long before the
financial crisis became front-page news, early signs appeared in user comments
on Reddit. “People were starting to whisper about mortgages. They were worried
about student debt. They were worried about debt in general. There was a lot
of, ‘This is too good to be true. This doesn’t smell right.’ ” He added,
“There’s probably some false positives in there as well, but, in general, I
think we’re a pretty good gauge of public sentiment. When we’re talking about a
faith-based collapse, you’re going to start to see the chips in the foundation
on social media first.”
How did a preoccupation with the apocalypse come to
flourish in Silicon Valley, a place known, to the point of cliché, for
unstinting confidence in its ability to change the world for the better?
Those impulses are not as contradictory as they
seem. Technology rewards the ability to imagine wildly different futures, Roy
Bahat, the head of Bloomberg Beta, a San Francisco-based venture-capital firm,
told me. “When you do that, it’s pretty common that you take things ad
infinitum, and that leads you to utopias and dystopias,” he said. It can
inspire radical optimism—such as the cryonics movement, which calls for
freezing bodies at death in the hope that science will one day revive them—or
bleak scenarios. Tim Chang, the venture capitalist who keeps his bags packed,
told me, “My current state of mind is oscillating between optimism and sheer
terror.”
In recent years, survivalism has been edging deeper
into mainstream culture. In 2012, National Geographic Channel launched
“Doomsday Preppers,” a reality show featuring a series of Americans bracing for
what they called S.H.T.F. (when the “shit hits the fan”). The première drew
more than four million viewers, and, by the end of the first season, it was the
most popular show in the channel’s history. A survey commissioned by National
Geographic found that forty per cent of Americans believed that stocking up on
supplies or building a bomb shelter was a wiser investment than a 401(k).
Online, the prepper discussions run from folksy (“A Mom’s Guide to Preparing
for Civil Unrest”) to grim (“How to Eat a Pine Tree to Survive”).
The reëlection of Barack Obama was a boon for the
prepping industry. Conservative devotees, who accused Obama of stoking racial
tensions, restricting gun rights, and expanding the national debt, loaded up on
the types of freeze-dried cottage cheese and beef stroganoff promoted by
commentators like Glenn Beck and Sean Hannity. A network of “readiness” trade
shows attracted conventioneers with classes on suturing (practiced on a pig
trotter) and photo opportunities with survivalist stars from the TV show “Naked
and Afraid.”
The living room of an apartment at the Survival
Condo Project.
The living room of an apartment at the Survival
Condo Project.
Photograph by Dan Winters for The New Yorker
The fears were different in Silicon Valley. Around
the same time that Huffman, on Reddit, was watching the advance of the
financial crisis, Justin Kan heard the first inklings of survivalism among his
peers. Kan co-founded Twitch, a gaming network that was later sold to Amazon
for nearly a billion dollars. “Some of my friends were, like, ‘The breakdown of
society is imminent. We should stockpile food,’ ” he said. “I tried to. But
then we got a couple of bags of rice and five cans of tomatoes. We would have
been dead if there was actually a real problem.” I asked Kan what his prepping
friends had in common. “Lots of money and resources,” he said. “What are the
other things I can worry about and prepare for? It’s like insurance.”
Yishan Wong, an early Facebook employee, was the
C.E.O. of Reddit from 2012 to 2014. He, too, had eye surgery for survival
purposes, eliminating his dependence, as he put it, “on a nonsustainable
external aid for perfect vision.” In an e-mail, Wong told me, “Most people just
assume improbable events don’t happen, but technical people tend to view risk
very mathematically.” He continued, “The tech preppers do not necessarily think
a collapse is likely. They consider it a remote event, but one with a very severe
downside, so, given how much money they have, spending a fraction of their net
worth to hedge against this . . . is a logical thing to do.”
How many wealthy Americans are really making
preparations for a catastrophe? It’s hard to know exactly; a lot of people
don’t like to talk about it. (“Anonymity is priceless,” one hedge-fund manager
told me, declining an interview.) Sometimes the topic emerges in unexpected
ways. Reid Hoffman, the co-founder of LinkedIn and a prominent investor,
recalls telling a friend that he was thinking of visiting New Zealand. “Oh, are
you going to get apocalypse insurance?” the friend asked. “I’m, like, Huh?”
Hoffman told me. New Zealand, he discovered, is a favored refuge in the event
of a cataclysm. Hoffman said, “Saying you’re ‘buying a house in New Zealand’ is
kind of a wink, wink, say no more. Once you’ve done the Masonic handshake,
they’ll be, like, ‘Oh, you know, I have a broker who sells old ICBM silos, and
they’re nuclear-hardened, and they kind of look like they would be interesting
to live in.’ ”
I asked Hoffman to estimate what share of fellow
Silicon Valley billionaires have acquired some level of “apocalypse insurance,”
in the form of a hideaway in the U.S. or abroad. “I would guess fifty-plus per
cent,” he said, “but that’s parallel with the decision to buy a vacation home.
Human motivation is complex, and I think people can say, ‘I now have a safety
blanket for this thing that scares me.’ ” The fears vary, but many worry that,
as artificial intelligence takes away a growing share of jobs, there will be a
backlash against Silicon Valley, America’s second-highest concentration of
wealth. (Southwestern Connecticut is first.) “I’ve heard this theme from a
bunch of people,” Hoffman said. “Is the country going to turn against the
wealthy? Is it going to turn against technological innovation? Is it going to
turn into civil disorder?”
The C.E.O. of another large tech company told me,
“It’s still not at the point where industry insiders would turn to each other
with a straight face and ask what their plans are for some apocalyptic event.”
He went on, “But, having said that, I actually think it’s logically rational
and appropriately conservative.” He noted the vulnerabilities exposed by the
Russian cyberattack on the Democratic National Committee, and also by a
large-scale hack on October 21st, which disrupted the Internet in North America
and Western Europe. “Our food supply is dependent on G.P.S., logistics, and
weather forecasting,” he said, “and those systems are generally dependent on
the Internet, and the Internet is dependent on D.N.S.”—the system that manages
domain names. “Go risk factor by risk factor by risk factor, acknowledging that
there are many you don’t even know about, and you ask, ‘What’s the chance of
this breaking in the next decade?’ Or invert it: ‘What’s the chance that
nothing breaks in fifty years?’ ”
One measure of survivalism’s spread is that some
people are starting to speak out against it. Max Levchin, a founder of PayPal
and of Affirm, a lending startup, told me, “It’s one of the few things about
Silicon Valley that I actively dislike—the sense that we are superior giants
who move the needle and, even if it’s our own failure, must be spared.”
To Levchin, prepping for survival is a moral
miscalculation; he prefers to “shut down party conversations” on the topic. “I
typically ask people, ‘So you’re worried about the pitchforks. How much money
have you donated to your local homeless shelter?’ This connects the most, in my
mind, to the realities of the income gap. All the other forms of fear that
people bring up are artificial.” In his view, this is the time to invest in
solutions, not escape. “At the moment, we’re actually at a relatively benign
point of the economy. When the economy heads south, you will have a bunch of
people that are in really bad shape. What do we expect then?”
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“I said, ‘Crush your enemies, see them driven
before you, and hear the lamentation of the women,’ but the media took that
totally out of context.”
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On the opposite side of the country, similar
awkward conversations have been unfolding in some financial circles. Robert H.
Dugger worked as a lobbyist for the financial industry before he became a
partner at the global hedge fund Tudor Investment Corporation, in 1993. After
seventeen years, he retired to focus on philanthropy and his investments.
“Anyone who’s in this community knows people who are worried that America is
heading toward something like the Russian Revolution,” he told me recently.
To manage that fear, Dugger said, he has seen two
very different responses. “People know the only real answer is, Fix the
problem,” he said. “It’s a reason most of them give a lot of money to good
causes.” At the same time, though, they invest in the mechanics of escape. He
recalled a dinner in New York City after 9/11 and the bursting of the dot-com
bubble: “A group of centi-millionaires and a couple of billionaires were
working through end-of-America scenarios and talking about what they’d do. Most
said they’ll fire up their planes and take their families to Western ranches or
homes in other countries.” One of the guests was skeptical, Dugger said. “He
leaned forward and asked, ‘Are you taking your pilot’s family, too? And what
about the maintenance guys? If revolutionaries are kicking in doors, how many
of the people in your life will you have to take with you?’ The questioning
continued. In the end, most agreed they couldn’t run.”
Élite anxiety cuts across political lines. Even
financiers who supported Trump for President, hoping that he would cut taxes
and regulations, have been unnerved at the ways his insurgent campaign seems to
have hastened a collapse of respect for established institutions. Dugger said,
“The media is under attack now. They wonder, Is the court system next? Do we go
from ‘fake news’ to ‘fake evidence’? For people whose existence depends on
enforceable contracts, this is life or death.”
Robert A. Johnson sees his peers’ talk of fleeing
as the symptom of a deeper crisis. At fifty-nine, Johnson has tousled silver
hair and a soft-spoken, avuncular composure. He earned degrees in electrical
engineering and economics at M.I.T., got a Ph.D. in economics at Princeton, and
worked on Capitol Hill, before entering finance. He became a managing director
at the hedge fund Soros Fund Management. In 2009, after the onset of the
financial crisis, he was named head of a think tank, the Institute for New
Economic Thinking.
When I visited Johnson, not long ago, at his office
on Park Avenue South, he described himself as an accidental student of civic
anxiety. He grew up outside Detroit, in Grosse Pointe Park, the son of a
doctor, and he watched his father’s generation experience the fracturing of
Detroit. “What I’m seeing now in New York City is sort of like old music coming
back,” he said. “These are friends of mine. I used to live in Belle Haven, in
Greenwich, Connecticut. Louis Bacon, Paul Tudor Jones, and Ray
Dalio”—hedge-fund managers—“were all within fifty yards of me. From my own
career, I would just talk to people. More and more were saying, ‘You’ve got to
have a private plane. You have to assure that the pilot’s family will be taken
care of, too. They have to be on the plane.’ ”
By January, 2015, Johnson was sounding the alarm:
the tensions produced by acute income inequality were becoming so pronounced
that some of the world’s wealthiest people were taking steps to protect
themselves. At the World Economic Forum in Davos, Switzerland, Johnson told the
audience, “I know hedge-fund managers all over the world who are buying
airstrips and farms in places like New Zealand because they think they need a
getaway.”
Johnson wishes that the wealthy would adopt a
greater “spirit of stewardship,” an openness to policy change that could
include, for instance, a more aggressive tax on inheritance. “Twenty-five
hedge-fund managers make more money than all of the kindergarten teachers in
America combined,” he said. “Being one of those twenty-five doesn’t feel good.
I think they’ve developed a heightened sensitivity.” The gap is widening
further. In December, the National Bureau of Economic Research published a new
analysis, by the economists Thomas Piketty, Emmanuel Saez, and Gabriel Zucman,
which found that half of American adults have been “completely shut off from
economic growth since the 1970s.” Approximately a hundred and seventeen million
people earn, on average, the same income that they did in 1980, while the
typical income for the top one per cent has nearly tripled. That gap is
comparable to the gap between average incomes in the U.S. and the Democratic
Republic of Congo, the authors wrote.
Johnson said, “If we had a more equal distribution
of income, and much more money and energy going into public school systems,
parks and recreation, the arts, and health care, it could take an awful lot of
sting out of society. We’ve largely dismantled those things.”
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“It’s only until spring.”
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As public institutions deteriorate, élite anxiety
has emerged as a gauge of our national predicament. “Why do people who are
envied for being so powerful appear to be so afraid?” Johnson asked. “What does
that really tell us about our system?” He added, “It’s a very odd thing. You’re
basically seeing that the people who’ve been the best at reading the tea
leaves—the ones with the most resources, because that’s how they made their
money—are now the ones most preparing to pull the rip cord and jump out of the
plane.”
On a cool evening in early November, I rented a car
in Wichita, Kansas, and drove north from the city through slanting sunlight,
across the suburbs and out beyond the last shopping center, where the horizon
settles into farmland. After a couple of hours, just before the town of
Concordia, I headed west, down a dirt track flanked by corn and soybean fields,
winding through darkness until my lights settled on a large steel gate. A
guard, dressed in camouflage, held a semiautomatic rifle.
He ushered me through, and, in the darkness, I
could see the outline of a vast concrete dome, with a metal blast door partly
ajar. I was greeted by Larry Hall, the C.E.O. of the Survival Condo Project, a
fifteen-story luxury apartment complex built in an underground Atlas missile
silo. The facility housed a nuclear warhead from 1961 to 1965, when it was
decommissioned. At a site conceived for the Soviet nuclear threat, Hall has
erected a defense against the fears of a new era. “It’s true relaxation for the
ultra-wealthy,” he said. “They can come out here, they know there are armed
guards outside. The kids can run around.”
Hall got the idea for the project about a decade
ago, when he read that the federal government was reinvesting in catastrophe
planning, which had languished after the Cold War. During the September 11th
attacks, the Bush Administration activated a “continuity of government” plan,
transporting selected federal workers by helicopter and bus to fortified
locations, but, after years of disuse, computers and other equipment in the
bunkers were out of date. Bush ordered a renewed focus on continuity plans, and
fema launched annual government-wide exercises. (The most recent, Eagle Horizon,
in 2015, simulated hurricanes, improvised nuclear devices, earthquakes, and
cyberattacks.)
“I started saying, ‘Well, wait a minute, what does
the government know that we don’t know?’ ” Hall said. In 2008, he paid three
hundred thousand dollars for the silo and finished construction in December,
2012, at a cost of nearly twenty million dollars. He created twelve private
apartments: full-floor units were advertised at three million dollars; a
half-floor was half the price. He has sold every unit, except one for himself,
he said.
Most preppers don’t actually have bunkers; hardened
shelters are expensive and complicated to build. The original silo of Hall’s
complex was built by the Army Corps of Engineers to withstand a nuclear strike.
The interior can support a total of seventy-five people. It has enough food and
fuel for five years off the grid; by raising tilapia in fish tanks, and
hydroponic vegetables under grow lamps, with renewable power, it could function
indefinitely, Hall said. In a crisis, his swat-team-style trucks (“the Pit-Bull
VX, armored up to fifty-calibre”) will pick up any owner within four hundred
miles. Residents with private planes can land in Salina, about thirty miles
away. In his view, the Army Corps did the hardest work by choosing the
location. “They looked at height above sea level, the seismology of an area,
how close it is to large population centers,” he said.
Hall, in his late fifties, is barrel-chested and
talkative. He studied business and computers at the Florida Institute of
Technology and went on to specialize in networks and data centers for Northrop
Grumman, Harris Corporation, and other defense contractors. He now goes back
and forth between the Kansas silo and a home in the Denver suburbs, where his
wife, a paralegal, lives with their twelve-year-old son.
Hall led me through the garage, down a ramp, and
into a lounge, with a stone fireplace, a dining area, and a kitchen to one
side. It had the feel of a ski condo without windows: pool table,
stainless-steel appliances, leather couches. To maximize space, Hall took ideas
from cruise-ship design. We were accompanied by Mark Menosky, an engineer who
manages day-to-day operations. While they fixed dinner—steak, baked potatoes,
and salad—Hall said that the hardest part of the project was sustaining life
underground. He studied how to avoid depression (add more lights), prevent
cliques (rotate chores), and simulate life aboveground. The condo walls are
fitted with L.E.D. “windows” that show a live video of the prairie above the
silo. Owners can opt instead for pine forests or other vistas. One prospective
resident from New York City wanted video of Central Park. “All four seasons,
day and night,” Menosky said. “She wanted the sounds, the taxis and the honking
horns.”
Some survivalists disparage Hall for creating an
exclusive refuge for the wealthy and have threatened to seize his bunker in a
crisis. Hall waved away this possibility when I raised it with him over dinner.
“You can send all the bullets you want into this place.” If necessary, his
guards would return fire, he said. “We’ve got a sniper post.”
The swimming pool at Larry Hall’s Survival Condo
Project. These days, when North Korea tests a bomb, Hall can expect an uptick
in phone inquiries about space in the complex.
The swimming pool at Larry Hall’s Survival Condo
Project. These days, when North Korea tests a bomb, Hall can expect an uptick
in phone inquiries about space in the complex.
Photograph by Dan Winters for The New Yorker
Recently, I spoke on the phone with Tyler Allen, a
real-estate developer in Lake Mary, Florida, who told me that he paid three
million dollars for one of Hall’s condos. Allen said he worries that America
faces a future of “social conflict” and government efforts to deceive the
public. He suspects that the Ebola virus was allowed to enter the country in
order to weaken the population. When I asked how friends usually respond to his
ideas, he said, “The natural reaction that you get most of the time is for them
to laugh, because it scares them.” But, he added, “my credibility has gone
through the roof. Ten years ago, this just seemed crazy that all this was going
to happen: the social unrest and the cultural divide in the country, the
race-baiting and the hate-mongering.” I asked how he planned to get to Kansas
from Florida in a crisis. “If a dirty bomb goes off in Miami, everybody’s going
to go in their house and congregate in bars, just glued to the TV. Well, you’ve
got forty-eight hours to get the hell out of there.”
Allen told me that, in his view, taking precautions
is unfairly stigmatized. “They don’t put tinfoil on your head if you’re the
President and you go to Camp David,” he said. “But they do put tinfoil on your
head if you have the means and you take steps to protect your family should a problem
occur.”
Why do our dystopian urges emerge at certain
moments and not others? Doomsday—as a prophecy, a literary genre, and a
business opportunity—is never static; it evolves with our anxieties. The
earliest Puritan settlers saw in the awe-inspiring bounty of the American
wilderness the prospect of both apocalypse and paradise. When, in May of 1780,
sudden darkness settled on New England, farmers perceived it as a cataclysm
heralding the return of Christ. (In fact, the darkness was caused by enormous
wildfires in Ontario.) D. H. Lawrence diagnosed a specific strain of American
dread. “Doom! Doom! Doom!” he wrote in 1923. “Something seems to whisper it in
the very dark trees of America.”
Historically, our fascination with the End has
flourished at moments of political insecurity and rapid technological change.
“In the late nineteenth century, there were all sorts of utopian novels, and
each was coupled with a dystopian novel,” Richard White, a historian at
Stanford University, told me. Edward Bellamy’s “Looking Backward,” published in
1888, depicted a socialist paradise in the year 2000, and became a sensation,
inspiring “Bellamy Clubs” around the country. Conversely, Jack London, in 1908,
published “The Iron Heel,” imagining an America under a fascist oligarchy in which
“nine-tenths of one per cent” hold “seventy per cent of the total wealth.”
At the time, Americans were marvelling at
engineering advances—attendees at the 1893 World’s Fair, in Chicago, beheld new
uses for electric light—but were also protesting low wages, poor working
conditions, and corporate greed. “It was very much like today,” White said. “It
was a sense that the political system had spun out of control, and was no
longer able to deal with society. There was a huge inequity in wealth, a
stirring of working classes. Life spans were getting shorter. There was a
feeling that America’s advance had stopped, and the whole thing was going to
break.”
Business titans grew uncomfortable. In 1889, Andrew
Carnegie, who was on his way to being the richest man in the world, worth more
than four billion in today’s dollars, wrote, with concern, about class
tensions; he criticized the emergence of “rigid castes” living in “mutual
ignorance” and “mutual distrust.” John D. Rockefeller, of Standard Oil,
America’s first actual billionaire, felt a Christian duty to give back. “The
novelty of being able to purchase anything one wants soon passes,” he wrote, in
1909, “because what people most seek cannot be bought with money.” Carnegie
went on to fight illiteracy by creating nearly three thousand public libraries.
Rockefeller founded the University of Chicago. According to Joel Fleishman, the
author of “The Foundation,” a study of American philanthropy, both men
dedicated themselves to “changing the systems that produced those ills in the
first place.”
During the Cold War, Armageddon became a matter for
government policymakers. The Federal Civil Defense Administration, created by
Harry Truman, issued crisp instructions for surviving a nuclear strike,
including “Jump in any handy ditch or gutter” and “Never lose your head.” In
1958, Dwight Eisenhower broke ground on Project Greek Island, a secret shelter,
in the mountains of West Virginia, large enough for every member of Congress.
Hidden beneath the Greenbrier Resort, in White Sulphur Springs, for more than
thirty years, it maintained separate chambers-in-waiting for the House and the
Senate. (Congress now plans to shelter at undisclosed locations.) There was
also a secret plan to whisk away the Gettysburg Address, from the Library of
Congress, and the Declaration of Independence, from the National Archives.
But in 1961 John F. Kennedy encouraged “every
citizen” to help build fallout shelters, saying, in a televised address, “I
know you would not want to do less.” In 1976, tapping into fear of inflation
and the Arab oil embargo, a far-right publisher named Kurt Saxon launched The
Survivor, an influential newsletter that celebrated forgotten pioneer skills.
(Saxon claimed to have coined the term “survivalist.”) The growing literature
on decline and self-protection included “How to Prosper During the Coming Bad
Years,” a 1979 best-seller, which advised collecting gold in the form of South
African Krugerrands. The “doom boom,” as it became known, expanded under Ronald
Reagan. The sociologist Richard G. Mitchell, Jr., a professor emeritus at
Oregon State University, who spent twelve years studying survivalism, said,
“During the Reagan era, we heard, for the first time in my life, and I’m
seventy-four years old, from the highest authorities in the land that
government has failed you, the collective institutional ways of solving
problems and understanding society are no good. People said, ‘O.K., it’s
flawed. What do I do now?’ ”
A dental chair in the Survival Condo Project’s
“medical wing,” which also contains a hospital bed and a procedure table. Among
the residents, Hall said, “we’ve got two doctors and a dentist.”
A dental chair in the Survival Condo Project’s
“medical wing,” which also contains a hospital bed and a procedure table. Among
the residents, Hall said, “we’ve got two doctors and a dentist.”
Photograph by Dan Winters for The New Yorker
The movement received another boost from the George
W. Bush Administration’s mishandling of Hurricane Katrina. Neil Strauss, a
former Times reporter, who chronicled his turn to prepping in his book
“Emergency,” told me, “We see New Orleans, where our government knows a
disaster is happening, and is powerless to save its own citizens.” Strauss got
interested in survivalism a year after Katrina, when a tech entrepreneur who
was taking flying lessons and hatching escape plans introduced him to a group
of like-minded “billionaire and centi-millionaire preppers.” Strauss acquired
citizenship in St. Kitts, put assets in foreign currencies, and trained to
survive with “nothing but a knife and the clothes on my back.”
These days, when North Korea tests a bomb, Hall can
expect an uptick of phone inquiries about space in the Survival Condo Project.
But he points to a deeper source of demand. “Seventy per cent of the country
doesn’t like the direction that things are going,” he said. After dinner, Hall
and Menosky gave me a tour. The complex is a tall cylinder that resembles a
corncob. Some levels are dedicated to private apartments and others offer shared
amenities: a seventy-five-foot-long pool, a rock-climbing wall, an Astro-Turf
“pet park,” a classroom with a line of Mac desktops, a gym, a movie theatre,
and a library. It felt compact but not claustrophobic. We visited an armory
packed with guns and ammo in case of an attack by non-members, and then a
bare-walled room with a toilet. “We can lock people up and give them an adult
time-out,” he said. In general, the rules are set by a condo association, which
can vote to amend them. During a crisis, a “life-or-death situation,” Hall
said, each adult would be required to work for four hours a day, and would not
be allowed to leave without permission. “There’s controlled access in and out,
and it’s governed by the board,” he said.
The “medical wing” contains a hospital bed, a
procedure table, and a dentist’s chair. Among the residents, Hall said, “we’ve
got two doctors and a dentist.” One floor up, we visited the food-storage area,
still unfinished. He hopes that, once it’s fully stocked, it will feel like a “miniature
Whole Foods,” but for now it holds mostly cans of food.
We stopped in a condo. Nine-foot ceilings, Wolf
range, gas fireplace. “This guy wanted to have a fireplace from his home
state”—Connecticut—“so he shipped me the granite,” Hall said. Another owner,
with a home in Bermuda, ordered the walls of his bunker-condo painted in island
pastels—orange, green, yellow—but, in close quarters, he found it oppressive.
His decorator had to come fix it.
That night, I slept in a guest room appointed with
a wet bar and handsome wood cabinets, but no video windows. It was eerily
silent, and felt like sleeping in a well-furnished submarine.
I emerged around eight the next morning to find
Hall and Menosky in the common area, drinking coffee and watching a campaign-news
brief on “Fox & Friends.” It was five days before the election, and Hall,
who is a Republican, described himself as a cautious Trump supporter. “Of the
two running, I’m hoping that his business acumen will override some of his
knee-jerk stuff.” Watching Trump and Clinton rallies on television, he was
struck by how large and enthusiastic Trump’s crowds appeared. “I just don’t
believe the polls,” he said.
He thinks that mainstream news organizations are
biased, and he subscribes to theories that he knows some find implausible. He
surmised that “there is a deliberate move by the people in Congress to dumb
America down.” Why would Congress do that? I asked. “They don’t want people to
be smart to see what’s going on in politics,” he said. He told me he had read a
prediction that forty per cent of Congress will be arrested, because of a
scheme involving the Panama Papers, the Catholic Church, and the Clinton
Foundation. “They’ve been working on this investigation for twenty years,” he
said. I asked him if he really believed that. “At first, you hear this stuff
and go, Yeah, right,” he said. But he wasn’t ruling it out.
Before I headed back to Wichita, we stopped at
Hall’s latest project—a second underground complex, in a silo twenty-five miles
away. As we pulled up, a crane loomed overhead, hoisting debris from deep below
the surface. The complex will contain three times the living space of the
original, in part because the garage will be moved to a separate structure.
Among other additions, it will have a bowling alley and L.E.D. windows as large
as French doors, to create a feeling of openness.
Hall said that he was working on private bunkers
for clients in Idaho and Texas, and that two technology companies had asked him
to design “a secure facility for their data center and a safe haven for their
key personnel, if something were to happen.” To accommodate demand, he has paid
for the possibility to buy four more silos.
If a silo in Kansas is not remote or private
enough, there is another option. In the first seven days after Donald Trump’s
election, 13,401 Americans registered with New Zealand’s immigration
authorities, the first official step toward seeking residency—more than
seventeen times the usual rate. The New Zealand Herald reported the surge
beneath the headline “trump apocalypse.”
The shooting range at the Survival Condo Project.
Hall said that the hardest part of the project was sustaining life underground.
He studied how to avoid depression (add more lights) and prevent cliques
(rotate chores).
The shooting range at the Survival Condo Project.
Hall said that the hardest part of the project was sustaining life underground.
He studied how to avoid depression (add more lights) and prevent cliques
(rotate chores).
Photograph by Dan Winters for The New Yorker
In fact, the influx had begun well before Trump’s
victory. In the first ten months of 2016, foreigners bought nearly fourteen
hundred square miles of land in New Zealand, more than quadruple what they
bought in the same period the previous year, according to the government.
American buyers were second only to Australians. The U.S. government does not
keep a tally of Americans who own second or third homes overseas. Much as
Switzerland once drew Americans with the promise of secrecy, and Uruguay
tempted them with private banks, New Zealand offers security and distance. In
the past six years, nearly a thousand foreigners have acquired residency there
under programs that mandate certain types of investment of at least a million
dollars.
Jack Matthews, an American who is the chairman of
MediaWorks, a large New Zealand broadcaster, told me, “I think, in the back of
people’s minds, frankly, is that, if the world really goes to shit, New Zealand
is a First World country, completely self-sufficient, if necessary—energy,
water, food. Life would deteriorate, but it would not collapse.” As someone who
views American politics from a distance, he said, “The difference between New
Zealand and the U.S., to a large extent, is that people who disagree with each
other can still talk to each other about it here. It’s a tiny little place, and
there’s no anonymity. People have to actually have a degree of civility.”
Auckland is a thirteen-hour flight from San
Francisco. I arrived in early December, the beginning of New Zealand’s summer:
blue skies, mid-seventies, no humidity. Top to bottom, the island chain runs
roughly the distance between Maine and Florida, with half the population of New
York City. Sheep outnumber people seven to one. In global rankings, New Zealand
is in the top ten for democracy, clean government, and security. (Its last
encounter with terrorism was in 1985, when French spies bombed a Greenpeace
ship.) In a recent World Bank report, New Zealand had supplanted Singapore as
the best country in the world to do business.
The morning after I arrived, I was picked up at my
hotel by Graham Wall, a cheerful real-estate agent who specializes in what his
profession describes as high-net-worth individuals, “H.N.W.I.” Wall, whose
clients include Peter Thiel, the billionaire venture capitalist, was surprised
when Americans told him they were coming precisely because of the country’s
remoteness. “Kiwis used to talk about the ‘tyranny of distance,’ ” Wall said,
as we crossed town in his Mercedes convertible. “Now the tyranny of distance is
our greatest asset.”
Before my trip, I had wondered if I was going to be
spending more time in luxury bunkers. But Peter Campbell, the managing director
of Triple Star Management, a New Zealand construction firm, told me that, by
and large, once his American clients arrive, they decide that underground
shelters are gratuitous. “It’s not like you need to build a bunker under your
front lawn, because you’re several thousand miles away from the White House,”
he said. Americans have other requests. “Definitely, helipads are a big one,”
he said. “You can fly a private jet into Queenstown or a private jet into
Wanaka, and then you can grab a helicopter and it can take you and land you at
your property.” American clients have also sought strategic advice. “They’re
asking, ‘Where in New Zealand is not going to be long-term affected by rising
sea levels?’ ”
The growing foreign appetite for New Zealand
property has generated a backlash. The Campaign Against Foreign Control of
Aotearoa—the Maori name for New Zealand—opposes sales to foreigners. In
particular, the attention of American survivalists has generated resentment. In
a discussion about New Zealand on the Modern Survivalist, a prepper Web site, a
commentator wrote, “Yanks, get this in your heads. Aotearoa NZ is not your
little last resort safe haven.”
An American hedge-fund manager in his forties—tall,
tanned, athletic—recently bought two houses in New Zealand and acquired local
residency. He agreed to tell me about his thinking, if I would not publish his
name. Brought up on the East Coast, he said, over coffee, that he expects
America to face at least a decade of political turmoil, including racial
tension, polarization, and a rapidly aging population. “The country has turned
into the New York area, the California area, and then everyone else is wildly
different in the middle,” he said. He worries that the economy will suffer if
Washington scrambles to fund Social Security and Medicare for people who need
it. “Do you default on that obligation? Or do you print more money to give to
them? What does that do to the value of the dollar? It’s not a next-year
problem, but it’s not fifty years away, either.”
New Zealand’s reputation for attracting doomsayers
is so well known in the hedge-fund manager’s circle that he prefers to
differentiate himself from earlier arrivals. He said, “This is no longer about
a handful of freaks worried about the world ending.” He laughed, and added,
“Unless I’m one of those freaks.”
Every year since 1947, the Bulletin of the Atomic
Scientists, a magazine founded by members of the Manhattan Project, has
gathered a group of Nobel laureates and other luminaries to update the Doomsday
Clock, a symbolic gauge of our risk of wrecking civilization. In 1991, as the
Cold War was ending, the scientists set the clock to its safest point
ever—seventeen minutes to “midnight.”
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Since then, the direction has been inauspicious. In
January, 2016, after increasing military tensions between Russia and nato, and
the Earth’s warmest year on record, the Bulletin set the clock at three minutes
to midnight, the same level it held at the height of the Cold War. In November,
after Trump’s election, the panel convened once more to conduct its annual
confidential discussion. If it chooses to move the clock forward by one minute,
that will signal a level of alarm not witnessed since 1953, after America’s
first test of the hydrogen bomb. (The result will be released January 26th.)
Fear of disaster is healthy if it spurs action to
prevent it. But élite survivalism is not a step toward prevention; it is an act
of withdrawal. Philanthropy in America is still three times as large, as a
share of G.D.P., as philanthropy in the next closest country, the United
Kingdom. But it is now accompanied by a gesture of surrender, a quiet
disinvestment by some of America’s most successful and powerful people. Faced
with evidence of frailty in the American project, in the institutions and norms
from which they have benefitted, some are permitting themselves to imagine
failure. It is a gilded despair.
As Huffman, of Reddit, observed, our technologies
have made us more alert to risk, but have also made us more panicky; they
facilitate the tribal temptation to cocoon, to seclude ourselves from
opponents, and to fortify ourselves against our fears, instead of attacking the
sources of them. Justin Kan, the technology investor who had made a halfhearted
effort to stock up on food, recalled a recent phone call from a friend at a
hedge fund. “He was telling me we should buy land in New Zealand as a backup.
He’s, like, ‘What’s the percentage chance that Trump is actually a fascist
dictator? Maybe it’s low, but the expected value of having an escape hatch is
pretty high.’ ”
There are other ways to absorb the anxieties of our
time. “If I had a billion dollars, I wouldn’t buy a bunker,” Elli Kaplan, the
C.E.O. of the digital health startup Neurotrack, told me. “I would reinvest in
civil society and civil innovation. My view is you figure out even smarter ways
to make sure that something terrible doesn’t happen.” Kaplan, who worked in the
White House under Bill Clinton, was appalled by Trump’s victory, but said that
it galvanized her in a different way: “Even in my deepest fear, I say, ‘Our
union is stronger than this.’ ”
That view is, in the end, an article of faith—a
conviction that even degraded political institutions are the best instruments
of common will, the tools for fashioning and sustaining our fragile consensus.
Believing that is a choice.
I called a Silicon Valley sage, Stewart Brand, the
author and entrepreneur whom Steve Jobs credited as an inspiration. In the
sixties and seventies, Brand’s “Whole Earth Catalog” attracted a cult
following, with its mixture of hippie and techie advice. (The motto: “We are as
gods and might as well get good at it.”) Brand told me that he explored
survivalism in the seventies, but not for long. “Generally, I find the idea
that ‘Oh, my God, the world’s all going to fall apart’ strange,” he said.
At seventy-seven, living on a tugboat in Sausalito,
Brand is less impressed by signs of fragility than by examples of resilience.
In the past decade, the world survived, without violence, the worst financial
crisis since the Great Depression; Ebola, without cataclysm; and, in Japan, a
tsunami and nuclear meltdown, after which the country has persevered. He sees
risks in escapism. As Americans withdraw into smaller circles of experience, we
jeopardize the “larger circle of empathy,” he said, the search for solutions to
shared problems. “The easy question is, How do I protect me and mine? The more
interesting question is, What if civilization actually manages continuity as
well as it has managed it for the past few centuries? What do we do if it just
keeps on chugging?”
After a few days in New Zealand, I could see why
one might choose to avoid either question. Under a cerulean blue sky one
morning in Auckland, I boarded a helicopter beside a thirty-eight-year-old
American named Jim Rohrstaff. After college, in Michigan, Rohrstaff worked as a
golf pro, and then in the marketing of luxury golf clubs and property. Upbeat
and confident, with shining blue eyes, he moved to New Zealand two and a half
years ago, with his wife and two children, to sell property to H.N.W.I. who
want to get “far away from all the issues of the world,” he said.
Rohrstaff, who co-owns Legacy Partners, a boutique
brokerage, wanted me to see Tara Iti, a new luxury-housing development and golf
club that appeals mostly to Americans. The helicopter nosed north across the
harbor and banked up the coast, across lush forests and fields beyond the city.
From above, the sea was a sparkling expanse, scalloped by the wind.
..
It was Tytler’s belief democracies, by their very
nature, could last little more than two centuries. While America has passed
that mark, it is suffering the fate Tytler claimed would befall all
democracies. He cited their fatal sequence as follows:
A democracy cannot exist as a permanent form of
government. It can only exist until the voters discover that they can vote
themselves largesse from the public treasury. From that moment on, the majority
always votes for the candidates promising the most benefits from the public
treasury with the result that a democracy always collapses over loose fiscal
policy, always followed by a dictatorship. The average age of the world’s
greatest civilizations has been 200 years. These nations have progressed
through this sequence: From bondage to spiritual faith; From spiritual faith to
great courage; From courage to liberty; From liberty to abundance; From
abundance to selfishness; From selfishness to apathy; From apathy to
dependence; From dependence back into bondage.
When presidential candidate Barack Obama was
campaigning in 2008, he called the debt run up by President George W. Bush of
approximately $500 billion “unpatriotic.”
One month into his presidency, Obama made a promise
about the debt that he then failed to keep. On February 23, 2009, he stated,
“…today I’m pledging to cut the deficit we inherited in half by the end of my
first term in office. This will not be easy. It will require us to make
difficult decisions and face challenges we’ve long neglected. But I refuse to
leave our children with a debt that they cannot repay – and that means taking
responsibility right now, in this administration, for getting our spending
under control.”
White House media director Macon Phillips added,
“This is big… And we’ll do it in a new way: honestly and candidly.”
Obama not only failed to cut the debt, he failed to
get his own spending under control. It is estimated by the time he left office,
the debt had tripled. Our children are now strapped with a debt they will most
likely be unable to repay.
While some may seek to dismiss his spending as the
cost of having to fight two wars, another startling reality about his
presidency fully supports Tytler’s observation:
Obama has become the first president in our history to spend more money
on welfare than on defense.
While Biden emphasized it was time to reinforce the
values of Western democracy which he accused Putin of undermining, he totally
ignored the undermining of the American work ethic that unlimited welfare has
brought—evidenced by the debt the Obama administration has helped balloon.
As Tytler predicted, voters discovered they could
“vote themselves largesse from the public treasury,” in this instance by voting
for Obama and Biden. Similarly, voters in European democracies have learned to
milk state treasuries.
Biden also commented at Davos that, since he is now
leaving office, he will start to say what he thinks.
It is ironic politicians like Obama and Biden, who
have been doling out benefits for years — in many cases to make the voters
their party depends on dependent upon them — should now wish to sound the alarm
about the damage to our democracy their own actions have wrought.
Lt. Colonel James G. Zumwalt, USMC (Ret.), is a
retired Marine infantry officer who served in the Vietnam war, the U.S.
invasion of Panama and the first Gulf war. He is the author of “Bare Feet, Iron
Will–Stories from the Other Side of Vietnam’s Battlefields,” “Living the Juche
Lie: North Korea’s Kim Dynasty” and “Doomsday: Iran–The Clock is Ticking.” He
frequently writes on foreign policy and defense issues.
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