Ever since OpenAI released its generative AI chatbot ChatGPT in November 2022, investors have flocked to AI companies to profit from the world-changing technology. The hype was so extreme that it sparked a debate on Wall Street about whether investors were justified in getting excited about his AI, or whether they were getting too excited.
Former Treasury Secretary Larry Summers, who joined the board of ChatGPT developer OpenAI late last year, weighed in on the debate Thursday at the Fortune Innovation Forum in Hong Kong. “A good general rule about innovation is that things take longer to happen than you think, and then they happen faster than you think,” he says.
Unlike many AI proponents, Summers believes that the full potential of AI will not be immediately apparent. “I don't think this is going to be a productivity miracle within the next three to five years,” he said.
Summers said it usually takes longer than people expect to get through the “last mile” of technology development – when an innovative technology is transformed into something the general public can use. Citing what he called the “productivity J-curve,” he argued that it takes years of investment, research, and development to turn a new idea into a productivity improvement.
“For example, consider self-driving cars. Hundreds of thousands, if not hundreds of thousands of workers have been dedicated to developing self-driving cars for years… and so far, “Not a single driver, truck driver or taxi driver has lost his job,” he said. “We've put a lot of effort into self-driving cars, but we haven't seen any results that can be measured statistically.”
But OpenAI directors are not AI skeptics.
“If we look to the next generation, this could be the biggest event in economic history since the Industrial Revolution,” he added. “This opens up the possibility of replacing not just some forms of human labor, but almost all forms of human labor.”
Summers predicted that AI will eventually be able to perform nearly every human job, especially white-collar “cognitive labor,” from home construction to medical diagnosis.
In that case, EQ, or emotional intelligence, will ultimately become more important than IQ.
“AI will replace doctors making difficult diagnoses before it replaces nurses' ability to hold patients' hands when they are frightened,” he said.