Don’t Fear Artificial Intelligence
AI is poised to transform the financial services industry and lead the world through the Fourth Industrial Revolution.
Technology is often feared, but in the long run, it provides the tools that lead to societal progress. For example, the advent of the printing press, which few would argue led to decline, gave rise to much uneasiness as it facilitated the dawn of an entirely new epoch of human existence: modernity. Though few would reject modernity, many have struggled with it.
Ezra Pound offers an ambivalent stance toward modernity in his early 20th century poem, “In a Station of the Metro”: “The apparition of these faces in the crowd; / Petals on a wet, black bough,” he writes. These lines echo British literary critic Matthew Arnold’s comment about “this strange disease of modern life,/ With its sick hurry, its divided aims.”
These qualms, though valid, do not focus on modernity’s benefits, such as scientific rationalism, mass literacy, and democratic politics. I see analogies between this brief sketch of history and the coming rise of artificially intelligent (AI) technologies, which some say will propel a Fourth Industrial Revolution that could usher us into a new phase of human existence.
Since the mid–20th century, computer scientists like Marvin Minsky have longed for the adoption of artificial intelligence, believing it can help combat societal problems. Over the past year, AI has become less of a niche topic, as the technology is being increasingly used in mainstream industries. In 2016 AI was seen in a diverse range of fields, from cucumber farming in Japan to modern medicine’s fight against cancer. It’s also become an important issue for the financial services industry.
“ was really the first time that we started to see a lot of traction or activity around artificial intelligence/machine learning,” says Maria Gotsch, president and CEO at the Partnership Fund for New York City, which co-sponsors the FinTech Innovation Lab. “AI really zoomed to the forefront,” with a high level of interest from financial institutions.”
Others say that 2017 may be the year that the financial services industry considers full-scale implementation of AI technologies. Ed Donner, CEO of Untapt, a FinTech Innovation Lab alumnus company, believes that we are in a “hold-onto-your-seats moment,” while Jonathan Lehr, co-founder at the enterprise technology venture capital fund Work-Bench, says that this year AI is “officially a board-level issue” in financial services. AI’s improvement of predictive analytics will lead to a “sea change” for the industry, according to Sunil Madhu, founder and CEO of the Work-Bench portfolio company Socure.
Meanwhile, the media have positioned artificial intelligence in a man-versus-machine narrative. Here are some headlines last year for articles featuring my company, Kensho, which uses AI to automate certain rote processes for the financial services industry:
“Wall Street Jobs Won’t Be Spared from Automation.” (Harvard Business Review)
“The Robots Are Coming for the Professionals.” (Times Higher Education)
“Wall Street Told to Fear the Machine as Emerging Tech Takes Jobs.” (Bloomberg)
“‘Skynet FX’ — AI Learning Machines Will Dominate Financial Markets.” (Finance Magnates)
“The Robots Are Coming for Wall Street.” (New York Times Magazine)
These headlines betray a certain amount of anxiety about the future of artificial intelligence. This anxiety, I believe, is very much worth investigating, because it’s become clear that AI will not only transform the financial services industry but also lead the world through the Fourth Industrial Revolution.
The question provoking this anxiety is, consistently, from article to article: Will AI take away our jobs? Whereas it’s true that AI will automate certain processes, it is perhaps even more true that AI will create new opportunities we can’t foresee. As I said at Davos, where I spoke on a panel about AI and unbiased decision making, we simply don’t know what the future has in store. But if history is any guide, advancement in technology (like the printing press) eventually leads to positive outcomes (mass literacy and modernity).
Man-versus-machine is a false dichotomy, pitting one against the other as two discrete, antagonistic entities. Machines will free up our time so we have fewer basic tasks to complete. We have already begun to see the start of this, with the creation of digital assistants like Siri and Alexa. Furthermore, machines will enable us to reimagine what our careers and working lives look like. It’s worth remembering that the 40-hour workweek is a construct with a short history — it was only in 1940 that it became codified through an amendment to the Fair Labor Standards Act. (Prior to that, the standard workweek, according to government records, was upwards of 100 hours.)
It’s most likely that AI will be a boon for society and business alike. Shaheen Kanda, CEO and co-founder of Syndicated Loan Direct, sees AI as a democratizing tool. In a world made efficient by artificial intelligence and machine learning, “small and midsize businesses could have access to similar financial instruments as a Fortune 500 company,” says Kanda, whose business uses AI to convert legal documents into financial data.
It’s examples like Kanda’s we must focus on, because the changes brought by an artificial intelligence revolution will lie somewhere in the middle of the man-versus-machine dichotomy that some espouse today.