Politicians, Pennies, and AI
Eliminating pennies and AI data grabs share a theme — giving more power to those who already have it
Imagine you could build a magic hotel for $2.17M. This hotel would never cost you anything more, yet it would generate $1M in revenue every time you opened it. Now, because in this imaginary world you’re worth trillions of dollars, this little hotel wouldn’t be your most useful asset by a long shot — remember, we’re imagining here — and you might even mothball it for weeks or months at a time. But every time you needed $1M more, it would be in great shape and ready to go. This could go on for years. You might even call this magic hotel, “The Lucky.”
As part of his “Mad King Distraction Tour,” the current US President directed that we stop minting new pennies because it costs us 2.17¢ for each 1¢ we mint. Sounds like a great way to save some money . . . to a guy who could bankrupt a casino.
Spending money doesn’t generate more hard currency, but more economic heat, more wealth in circulation. If I spend that 1¢, someone else has 1¢ to spend, meaning the first penny has now generated 2¢ in wealth. Spend it one more time, and that penny has more than paid for itself in wealth creation. Over the life of a penny, it could be worth every other coin’s face value in wealth creation, depending on how many times it’s transacted.
Most currency is digital, which has been the case for decades, so the small number of pennies being minted is specific to those who still use cash. Despite some claiming that eliminating the penny wouldn’t hurt the poor, it would hurt the cash economy.
I personally like the cash economy. If I want to buy something without anyone else knowing, or leave a big tip surreptitiously, or slip a big bill into a Salvation Army kettle without any fuss, the cash economy is great.
For a lot of people with no or poor credit, working manual labor, pouring drinks, or repairing properties, cash is still important. Eliminating the penny is another cut people working for cash wages don’t need.
Do you think that the item selling for $2.99 now would sell of $2.95 or $3.00? Do you think costs might be 1¢ lower for credit purchases? What about that $2.79 item? $2.80 or $3.00?
On this note, economists have noted that eliminating the penny will mean the US Treasury would have to mint more nickels, which cost more than pennies.
Do you think your online banking or investments will move away from counting things to the penny? Or will only those in the cash economy be forced to count things to the nickel?
Eliminating the penny reduces the value of economic transactions every so slightly, tilts the table further toward the haves, and makes the cash economy even more unfair.
It’s not a growth strategy, and it’s a distraction.
The UK AI plan
“. . . you can’t have a democracy in a highly evolved information society if information is free.”
— Jaron Lanier, 2013
I recently mentioned in a post about the dehumanizing elements in tech a proposal from Peter Kyle, the Secretary of State for Science, Innovation and Technology in the UK, to privilege AI companies in the UK by putting copyright holders in the position of having to opt-out of AI training in order to preserve their copyrights.
Kyle came to believe in AI reportedly because he thinks AI tools could have caught his mother’s lung cancer “earlier,” making his fight for AI “personal.” His mother died 12 years ago.
Kyle’s idea is that forcing an opt-out will result in people accidentally giving up their copyrights, while data troves obtained in this manner will help make the UK an AI power.