“Of all the jobs in front of us, the most important is to ensure a happy life for our people. Every family hopes that their children can have a good education, their seniors can enjoy good elderly services, and their youngsters can have more and better opportunities. These simple wishes are our people’s aspirations for a better life. We should work together to steadily improve social undertakings and governance, build a harmonious and inclusive atmosphere, and settle real issues, big or small, for our people. We must bring more smiles to our people and greater warmth to their hearts.”
—Xi Jinping’s 2025 New Year Speech
I’m starting to notice a trend that may become clearer in the coming years, once the noise cools off.
From where I stand, the value of human capital seems to increase in the age of AI automation rather than decrease. Newer generations are becoming more educated precisely in the domains AI is disrupting right now.
I suspect average IQ could rise, driven by two factors (and a bit of luck):
- The barrier to accessing cheap yet reliable education has collapsed drastically. If in the past “Google it” was on everyone’s lips, now it’s “Ask ChatGPT”. Having said that, I’d trust ChatGPT more with providing information to the average citizen than Google search. In my worldview, spotting a hallucination here and there is less harmful than getting onto Alex Jones’s Infowars website.
- AI could be a cognitive rehab. Smartphones and social media have eroded our attention spans, but engaging with AI (e.g., through reading, conversing, refining ideas) might reverse the damage. Generally speaking, more time spent reading makes you smarter, period. The back-and-forth of dialogue, in which you’re both speaker and listener, compounds the effect.
This influx of technology into daily life feels inevitable. Familiarity with the technology is no longer optional but a new kind of literacy. Those who’ve gone the extra mile experiencing it firsthand often return with insight and a warning etched across their foreheads that even the most skilled workforce struggles to accommodate this new layer into their daily lives.
Thus, I claim that becoming AI-savvy across several dimensions will be highly rewarded by society. If the price of reduced misery is becoming something like digital horse whisperers, while retaining the freedom to roam intellectually and physically, then it’s a small one to pay.
China, I believe, understands the intrinsic value of human capital, and at its current pace, may well win both the welfare and cyberspace races (e.g., state-funded initiatives such as integrating AI/quantum physics into primary education). Their entire system is built around subsidizing and thus incentivizing value creation at the expense of profits. For instance, I expect from China more so than US to commoditize FLOP.
To elaborate, many don’t realize that at its core, compute is just electricity. China generates ~2x more electricity than US (9.4 PWh vs. 4.2 PWh), which translates into US having ~2x per capita electricity generation more than China (12.5 MWh vs. 6.6 MWh). But that’s for a population ~4x smaller than China’s. It’s arguably misguided to brag about owning SOTA chips if you don’t have the infrastructure to power them. Cheap, abundant compute could fuel the AI-driven curricula China is rolling out, creating a feedback loop between infrastructure and skilled labor.
There’s pride, too, in being a “Chinese peasant”, Mr. Vance. Just not the kind your worldview can recognize.