The Next Internet Job BOOM

“We’re now in the sixth extinction event of life on the planet...We could lose over half the species on earth in the next seven decades. And we don’t know if our species will be able to survive as we know it… We’re going to see storms we haven’t seen since humans beings have been on this planet...which means devastation of infrastructure, devastation of human lives… I don’t think people are prepared for the enormity of what’s already starting.”

↑ This is not the cheerful start I expected for my chat with Jeremy Rifkin on the latest episode of The McFuture podcast. Jeremy is best-selling author of The Zero Marginal Cost Society, adviser to Angela Merkel and the EU, and a Wharton lecturer.

Like me, Rifkin has been thinking a lot about saving our future. (He just does it with fewer Kanye references.) What surprised me was his motivation. He believes something I’ve mostly ignored - climate change - will destroy us, if we don’t act now. If we do, everyone will have the greatest Christmas in human history...with a small catch.

RED WEDDING CAKE

My initial reaction to Jeremy’s apocalyptic scenario was to build an arc. Since I’m a ham-handed city-dweller, I’d need Uber or Taskrabbit to do it. Instead, I did what I do best - rationalize.

I guess subconsciously, I always viewed climate change as par for the course. All of human history - and earth's history - is full of mini-extinctions - plagues, natural disasters, pricks with tiny mustaches.  Like waves try to spit us out of the ocean the second we get in, maybe climate change is another of earth’s not-so-subtle hints that we’re not welcome.

“This time it’s different," says Rifkin. "Those other events were localized. This one affects the whole planet...the biosphere.  It’s all about water. “

So what do we do?

“We need a new economic vision for the world...and we need a game plan...that better be deployable in the next four or five decades.”

It just so happens Jeremy has one.

As he began to lay out his ambitious plan, I kept imagining a massive wedding cake. Not because I’m a starving pre-diabetic, but because his ideas are layered, ambitious, delicate, and co-dependent.

But he’s not baking for Eva Longoria’s next wedding. Climate change is our Red Wedding.

His cake has four cataclysm-preventing layers...they’re like the antioxidants of economics.

LAYER 1: THE INDUSTRIAL REVOLUTION

The first layer is the foundation of all revolutions.

“There have been at least seven major economic...shifts in history, and...three defining technologies…that radically transformed...societies and civilizations,” Rifkin told me.

His three ingredients are:

• new communication technologies
• new sources of energy
• new forms of transportation

The first industrial revolution was powered by coal, steam, and the telegraph.  

“Wage labor, contract labor, urban life, everything that we perceive an Industrial...society to be...all came from that technology infrastructure,” according to Rifkin

The second industrial revolution was built on fossil fuels, cars, and telephones. But it died in 2008, along with my retirement savings.

So what does the next revolution look like?

LAYER 2: THIRD INDUSTRIAL REVOLUTION

Rifkin says we’re already inside a third industrial revolution and it has no less than THREE internets!

They say you never forget your first internet… Ours is the “internet of communication.” It’s now mature...even if the people on it are not. #LOL #OMG

Then there’s “the internet of transportation.”  

Companies like Uber are cobbling together wireless, GPS, and payment platforms to organize consumers and drivers into a surprisingly seamless experience. And when Sun God Elon Musk makes our horseless carriages driverless, efficiency will go through the roof. A solar roof.

“The internet of energy”- built with smart grids, solar and batteries  - will let people and businesses produce, store, and share energy more easily than Kanye Tweets.

“These three internets...ride on top of this platform called the ‘internet of things,” explains Rifkin.

Rifkin believes the Internet of Things has one big trick up its sleeve:  it will create a massive 40-year job boom. High quality jobs producing, installing, connecting, and managing this massive network that connects everything to everything else.

But this boom has a dark side.

Our third industrial revolution will be our last, proclaims Rifkin. I never say never... But he's confident this will mark the end of mass employment.

The same way drivers know their profession will go Full Robot in 10-20 years, Rifkin has given all of us 40 years notice. That’s way better than the two weeks I gave my last employer.

I’ll wait here while you adjust your 401K deductions...

As you save your shekels, know that Jeremy and I will be up all night hatching an alternative economic system that isn’t based on mass employment.

To be fair, he’s a bit ahead of me…

LAYER 3: ZERO MARGINAL COST SOCIETY

As data  gushes from every physical object, our wired-up Orwellian wonderland will become super efficient. So efficient, according to Rifkin, that it will bring the marginal cost of most goods and services near zero. That’s right, each additional unit of everything will cost nada, zero, zilch to produce.

And good thing - because you’ll also be unemployed. See above.

Rifkin’s argument is rooted in how the communications internet reduced the marginal cost of making and distributing information to near zero. Click once, distribute to millions - without a single Xerox or stamp.

Of course, the challenge of using “free” platforms like Gmail, Youtube and Facebook as models is they’re not free at all. They’re subsidized by companies that sell real products for real profits in the real world.

But Rifkin makes valid cases (on the podcast) for how this is already happening with energy in Germany and in transportation with Uber. He cites a study in Ann Arbor Michigan that says we could take 80% of cars off the road with today’s technology.

But can physical goods follow the same path?  

Rifkin had no doubt.

“In a way, [eliminating profits] is the ultimate success of capitalism.”

I needed some convincing.

It’s impossible to deny that technology has driven the price of clothing, food, and gadgets lower and lower. But making physical goods near zero?

I see one big obstacle to Rifkin’s vision: suppliers.

Unless a company controls the entire supply chain - from sourcing materials through distribution, they rely on lots of third parties. Each demands a markup. So marginal costs can decline, but not to zero. Or as I call it, the point of indifference. At that point, why not close up shop and take your Roomba out for a romantic stroll, er, roll?  

Let’s say Apple becomes fully automated, operates at full efficiency, and is powered by butterflies. Even with zero spent on energy and labor, it would still need to buy screens from Samsung, chips from Qualcomm, distribution through Verizon, and shipping with Fedex. To consumers, the incremental cost would not be zero since all those companies have their own suppliers to pay.

Why would anyone do anything in this world?

LAYER 4: COLLABORATIVE COMMONS

As costs plummet to zero, Rifkin envisions replacing capitalism itself with a fairer, more efficient and collaborative system he calls the “Collaborative Commons.” It’s a mashup of the sharing economy, cooperatives, and regulation.

Rifkin calls the sharing economy the first transformative new economic system since capitalism and socialism.  

I’ve been less kind, arguing nothing is shared and no one is collaborating. Instead, "sharing" labor is working for less - without benefits or certainty. And “sharing" property on AirBnB is bite-sized renting. And having to do either, amounts to survival.

But in Rifkin’s rosier view, “prosumers” will create and share physical products and services the same way we do WordPress posts today. “We’ll spend part of our day sharing, part of the day making money.”

Personally, I’ll spend part of my day tweeting @BillGates for free airdrops of Plumpy'nut malnutrition bars. Hey, no jobs is no jobs...

The most ambitious part of Jeremy’s vision is people will use tools like 3D printing, apps, and GPS to create cooperatives powerful enough to kill off Uber. Yes, kill off Uber.

“Lots of drivers are saying, ‘What the hell do we need Uber for?’ Anybody can set up a GPS site. This is not rocket science...and then we get a cooperative. And then if you have a choice of going local with cooperatives where the revenue stays within the group...and you have the same efficiency...why would you go with Uber?”

I suppose this could happen, but…

I imagined some Egyptian immigrant in a cramped two bedroom yelling at his daughter, “Fatima, bring me my iPhone. Abdul and I must take down Uber. But we cannot build empire with you killing battery, playing Hungry Bird!”

I have a hard time believing a ragtag bunch of cooperatives can beat focused, soulless, professional capitalists like Uber. Especially, when all the tools they need are controlled by entrenched power players.

Even great open source projects like Linux and Mozilla’s Firefox are regularly used and abused by driven competitors who throw millions at product development, top talent, and marketing blitzkriegs.

I’ve argued how we’re rocketing towards monopoly in almost every industry. Comcast’s CEO isn’t just going to throw his hands up in the air, “Well, we’ve done all we can. The people have spoken. Here’s the keys. Oh, and check behind the couch, that’s where we keep The Lindbergh Baby.” No. They’re going to protect their turf with crushing litigation, acquisitions, and buying congressmen by the bushel.

Rifkin has more faith.

Despite today’s 50% voter turnouts, he expects an assertive youth movement to demand better regulation of monopolies like Google and Facebook as they start to look like utilities.

He also sees startup costs dropping low enough for lots of small co-ops to compete with monopolies.

I imagined a gang of tattooed hipsters burrowing under Williamsburg to mine iron ore… Then I proposed a compromise: Maybe our thin layer of competitive coops will live on top of many thicker layers of entrenched monopolies.

Rifkin agreed. We will have a mixed system.

And so, peace and prosperity descended upon Oz.

BUT WAIT, THERE’S MORE!

When I asked Rifkin - what if the monopolies win? His response was priceless:

“If this could happen, the human race deserves its fate.”

Listen to this full episode on The McFuture podcast. Also, visit IdeaFaktory for a special 30 minute bonus episode of Jeremy and I discussing what happens to human purpose in a tech-drenched future. Subscribe to the show for more incredible guests coming up!

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Bio: Steve Faktor is CEO of IdeaFaktory growth & innovation consultancy and host of The McFuture Podcast, a provocative, funny exploration of a future stuffed with Kardashians but starved for meaning...and vision. Steve is a popular keynote speaker, LinkedIn Influencer, and regularly featured in Forbes, Harvard Business Review, NPR, Wall Street Journal, among others. Steve is the former head of the American Express Chairman’s Innovation Fund, senior executive at Citi and MasterCard, and Andersen consultant. You can follow him via email newsletter, LinkedIn, Facebook & Twitter.