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In this episode of Digital Marketing Masters, host Matt Rose welcomes Paul Summerville, co-author of "Reclaiming Populism: How Economic Fairness Can Win Back Disenchanted Voters." Paul shares insights from his book, co-written with Eric Protzer, exploring the impact of economic fairness on political landscapes and voter disenchantment. The discussion delves into Paul's personal journey from academia to finance, highlighting how societal structures in countries like Canada provided opportunities that shaped his career.

Paul explains the research behind the book, focusing on the correlation between low social mobility and susceptibility to radical populism in countries like the UK and the US. He emphasizes the importance of economic fairness as a solution to reclaim disenchanted voters, advocating for policies that promote equal opportunity and fair outcomes.

The conversation also touches on the role of social media and misinformation in amplifying populist sentiments, and the challenges of addressing these issues in high-income countries. Matt and Paul discuss the potential of AI and technological advancements to reshape economies, stressing the need for political systems to adapt and prioritize economic fairness.

As they explore the future of work and the impact of AI, Paul and Matt consider the necessity of universal basic income to support those displaced by technological changes. They highlight the importance of embracing innovation and understanding the rapid pace of technological evolution.

Throughout the episode, Paul shares anecdotes from his political experiences and insights into how societies can navigate the challenges posed by economic and technological disruptions. The episode concludes with a discussion on the importance of storytelling and communication in addressing complex societal issues.

Reclaiming Populism: How Economic Fairness Can Win Back Disenchanted Voters

https://www.amazon.com/Reclaiming-Populism-Economic-Fairness-Disenchanted/dp/1509548114

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[00:00:10] AI Singer:

Our guest is Paul Somerville.   He is the author of the book,   Reclaiming   Populism.   It's all about how.   Economic fairness   can win back   disenchanted   voters   with your   Matt Rose.  

[00:00:47] Matt Rouse:

Welcome back to Digital Marketing Masters. I'm your host, Matt Rose. Today,   my guest is Paul Somerville. Paul, how are you doing? Every day is a great day. Absolutely.   Now, Paul, I really liked, you know, the idea behind   your latest book. I think with everything going on in the world today, kind of   socially and politically   and,   you know, there's a lot of marketing in political marketing world. You know, our company has even done some political marketing in the past.   I thought it was worth, you know, having a chat about it. And kind of as as an aside, I I mentioned to somebody this morning that I was gonna interview you about this topic, and   they kind of went on this diatribe about what's wrong with people nowadays that they don't wanna hear the other viewpoint getting siloed into their own belief systems and this and that. And I'm like, well, that's actually true.  

The book is, Reclaiming Populism,   How Economic Fairness Can Win Back Disenchanted   Voters. It's by yourself and, Eric Prosser,   right, from Harvard ProFlab.   Yes.   Do you want to give us kind of a quick synopsis  

[00:01:56] Paul Summerville:

of the book? Sure. Well, first of all, I'm 67   and I went to Japan in 1980 3 as a starving PhD student.   At 31, I graduated with my doctorate and then I got sucked up into the roaring profitability of global finance   because in 1988,   89 when I graduated, every investment bank in the world was going from like 5 people to 2,000.   So, you know, if you could speak and read Japanese, you could you could start off with a really good salary. Right. And it took me 3 or 4 years. But when I got my bonus in 1993,   I became a millionaire.   And I thought to my, I not completely unexpected.  

It expected to be an academic.   And I kind of asked myself, how did this happen?   Not that I questioned it at all, concluded that of course I worked hard, gave up a lot, you know, being away from my family at Christmas, being in Japan, all that kind of stuff. But the truth is that I really felt that if I hadn't been raised in Canada, I was born in the UK, that I wouldn't have been given a lot of the opportunities   required to kind of take the path that I did. A very good university education that was essentially free, you know, free health care,   pretty good public transit. I used to commute the 1st 2 years on buses.  

And I had in the back of my mind that,   well, one day I think I'd like   to kind of perhaps   map out, you know, what was the architecture   for   someone like myself, not inheriting their opportunity,   but that the society giving them the opportunity and that they could take it. So   in   2013,   2014, 2015,   I started to do some research   and it was pretty clear to me that the world was   starting to break apart in the established social democracies,   and that you were starting to get language   that suggested that we are about to head into a very kind of rocky period.   And in 2019,   after Brexit and after Trump,   it was really clear that something fundamental was happening   in the most important liberal democracies. And from my own research, it was pretty clear   that of the 26 rich countries,   the ones that were the most susceptible   to what I would call   radical populism,   which is populism that completely up,   overturns the established   customs,   even laws of how our society organizes itself,   were countries with very low social mobility. And these were countries where it was difficult to get ahead,   where your parents'   income   had a huge determining impact on your own future and your grandkids' future.  

And it just turned out that the among the lowest   countries, the lowest social mobility was the UK and the United States.   And the ones with the highest, the Nordic countries, Australia, New Zealand, Canada,   all these countries seem somewhat immune, not that they weren't buffeted by populous moments like the migration crisis in 2016, 2017   that certainly affected the Netherlands, for example, that these countries were to use a phrase during COVID inoculated   to some degree against,   against   this kind of   upsetting   overturning kind of populism. So I had been mentoring Eric. I'd known him since he was 17.  

Amazing, amazing guy. He ended up at MIT doing a full scholarship,   economics and technology. And when he graduated,   we had kept in touch. I suggested that we should try   writing this book and see where we end up. And by the time we got to the summer, so we started in January 2019. By the summer of   2019, it was pretty clear that this idea of economic fairness   was becoming a very important meme in the conversation about what was going on with populism.   And so Eric took the summer off. He told me go play golf for summer,   and I'm gonna do like quantitative analysis and see if I can,   nail down, you know, the core reason for a populist   complaint.  

And there were a lot of competing explanations,   too many immigrants,   social media,   intergenerational   disputes,   and income inequality. These were like the big explanations. And Eric showed very, very clearly   that only   low social mobility   was the constant   way that you could explain   the populist,   eruptions, and that the others were simply amplifying the problem. So the core problem Right. Which we talked about instead of saying sociability,   we use the term economic fairness.   So places that were economically   unfair, where sociability was low,   these were countries that were very susceptible   to the populist problem.  

Trump, Brexit,   France, where they guillotine,   Italy, places like this. And so we wrote the book, it took us   two and a half years to write it. We finished it in, January   2021.   We had a fantastic editor. We had a great publisher, John Wiley and Sons in the United States, Polity Books in the UK, but a great editor. And early on, the working title for the book was defeating populism.   But early on with our relationship with the editor, John Ores in Polity, he said he should probably rethink your title   to reclaiming populism   because   what we were saying was that the populist complaint is legitimate.  

The complaints that, people   many people have that Trump has amplified,   that   Nigel Farage and others have rolled the coattails of. These are people who, you know, rightly feel that they don't have a stake in the game, and they don't have any chance to move ahead. So, for example, one of the arguments to vote remain in 2016   was that, you know, if you were born in the UK and had a UK citizenship, you could go work in 26 European countries. Right. How could you turn that down? And the the the rejoinder of that was there's many of these people that wanna vote leave can't get to the end of their street.   Right. Right? They don't have the tools that they need need to do that. So the book was published in November 2021,   and, it it we it it was the timing was very, very good. It was actually very, very good in Canada because of the the Ottawa convoy.  

And we did a lot of, you know, New York Times, CBC, all this kind of stuff.   But the interesting thing was that kind of the peak of interest of our book, Putin decided to invade the Ukraine.   So on the news cycle, we went from, like, you know, getting 9 phone calls a day to, like, disappearing.   And I right away, I called our editors and said, could we remain could we could we change the title of the book to, reclaiming Ukraine? But he he didn't agree. Hey. In the meantime,   so, we did   a number of presentations.   And then, of course, when Trump kind of reemerged, the book has got another bump, was reviewed in the Times, educational supplement.  

We did an audio book that's done very well. So the book is enjoying   a kind of a second life, although   the,   I conclude the at the very beginning of the book, we made the claim that   the problem   we were facing in terms of the populist complaint was that it was a generational challenge.   It had taken 25 or 30 years to create this mess, that it was gonna take another 25 years to work your way out of it, and that the risk was a place like the United States, that things would get worse before they get better. And there was a lot of commentators that kinda picked up on that.  

[00:09:30] Matt Rouse:

So,   I mean, there's a lot to unpack there, obviously.   You talk about, like, social mobility,   you know, being one of the most important factors and how stuff like social media, you know, maybe was   amplifying   the the the message from that.   I think one thing that a lot of people, especially in the marketing industry specifically point to is they say, well, what about the rise of social media disinformation campaigns?   Right? Where it's misinformation,   disinformation,   and a lot of these are   state sponsored.   You know, there's there was the recent,   FBI investigation. I think it was 400   YouTube streamers who were getting   ultimately   paid by Russia,   you know, through through a third party company that does influencer marketing,   you know, and there was also,   you know, Elon Musk buys x and gets rid of all the people who do the fact checking. And then Facebook recently got rid of fact checking,   which   everybody says that the excuse is freedom of speech, which is an odd   it's an odd   angle, I think, and this is a little bit of an aside,   but why can't you have free speech, but also check if it's true?  

Like, I don't know I don't know why those two things need to be separate, but anyway They ought not to be. Well, the so it's  

[00:10:58] Paul Summerville:

so your point your point's important because obviously   that's one of the challenges of trying to work our way through this episode, this   generational challenge we're in, which is how people communicate to each other and share ideas or don't share ideas, you know, as the case may be.   But what we showed was if you look at the 27   high income countries, because we we only looked at the so called rich countries. We can't say rich anymore because it's politically incorrect. So we say high income. So the high income countries   that all of them, of course, have lots of disinformation   in their social media platforms, you know, Denmark as much as the UK does. But where does that   amplify   the underlying complaint? So you need the underlying problem to begin with. So it's a little bit like I don't know if I can use this metaphor, but, you know, if you don't work out and you're, you know, £55   overweight, you know, the risk that you're gonna have a heart attack and get get ill   is higher than someone who works out, takes care of themselves, eats properly. You're not gonna you're you're, you know, you're not gonna be as affected   by the issues around,   that's presented in social media if you're not really worried about stuff. So for example, in Canada, we make the case that Canada has been largely immune to it, but Canada's had a real deterioration in its social mobility in the last 4 years   because of the, the rise in housing prices and the way that people feel, whether they are or whether they're not, cut off from medical services and that kind of thing. So you you the underlying complaint   must be must be there, deeply rooted. Again, it's it's it's something that is generational   in its architecture   and they're   therefore easily played upon   by, you know, bad actors   in Russia, China, North Korea, Iran, wherever they happen to be. Yeah. I think there also seems to be this misunderstanding  

[00:12:50] Matt Rouse:

that   people say,   and regardless of someone's political ideology,   they say in my ideology,   we can see all the misinformation   going to everyone else, and they don't think that theirs has any. Right? But there is just as much state sponsored   misinformation   going out as well as, you know, non state sponsor. I don't wanna blame it all on other governments kind of thing. Right. There there is also another thing, and I think this is an interesting one that people don't see, which is   the   way that   creators,   you know, adds a job, the way that creators get paid   is by getting kind of virality or engagement with the things that they make. That's right.  

But the problem is, you know, that old that old adage that, you know, the   the the lies gets over go around all day before the truth gets out of bed kind of thing. Right. Joseph Joseph Goebbels, the bigger lie, the better. Right. The bigger lie, the better. Well, it's true. Right? So if somebody posts something that is not true, but has an emotional trigger, it is way more likely to spread,   which means they get paid more, right, than something that does not.  

[00:14:04] Paul Summerville:

So there is very little incentive to tell the truth. Right? Well, yes and no. So, I mean, that's obviously a really important point. But, you know, the fact is is that disinformation has been around for a very, very long time. The Hearst Newspapers, you know, making up, you know, awards in the in in Latin America,   the Vietnam War, the Pentagon Papers. I mean, you can go on and on and on. You know, lots of people through history have had reasons that lying made more sense than the truth. Right. The fact is that there are platforms where you would think that   there is   a commitment to try to tell the truth, even though it's colored sometimes by political   perspective.  

But again, we go I go back to this issue around populism   and and the populous complaint and how it plays out politically.   You really need to have the underlying   deep underlying issue of economic unfairness   for it, for, for it to then get to the next level, to be susceptible   to, to the kind of messaging that comes from a social media. You know, one of the, one of the arguments of the left, for example,   you know, is that our economic   outcomes the last   25 years have been unfair because there's huge inequality.   And we actually make the case in the book that that's not the case, that unequal outcomes are a natural   result of the human condition of millions of people trying to get ahead. And it's actually a really good thing. If you want a so if you want a successful social democracy,   unequal outcomes are vital. But, you know, there's a lot of left wing parties that have tried to respond to the populous complaint by talking about radical redistribution.  

Jeremy Corbyn was was one of the most recent who got absolutely obliterated,   you know, as a as a consequence.   So what we've been arguing is, and this is the conclusion of our book, which I always suggest to people they read first because it's kind of a road map for the rest of the book,   that in order for the populist   vote or the disenchanted voter to be reclaimed,   that what has to happen is that mainstream political parties give up wokeism,   give up the social justice, give up the income inequality   conversation,   and talk about economic fairness instead. Because when you talk about economic fairness, then that gives you a door to talk about, okay, what does that mean? And we talk about the twin virtues of equal opportunity,   which is much more than education and health care. It's a chapter 4. We go through quite a detailed   architecture of that and   fair unequal outcomes. In other words, you if someone   works hard, studies hard, invent something great, then and they become a billionaire because of that. Well, why not? As long as they play by the rules.  

And   then you tax them smartly   to create the revenues, to give other people the next generation a chance to to chance to move ahead.  

[00:16:59] Matt Rouse:

Now   I I I a 100% agree with the idea of of,   you know, this idea of,   you know, giving everybody   the ability to get ahead. And I think there is this misunderstanding.   Right? The tools to get ahead.   Right?   There's this misunderstanding, especially in the United States. And, you know, I lived in the United States for 20 years and I lived in Canada for, you know, 30 years. So I kind of an understanding of both countries fairly well.   There's this idea of pull yourself up by your bootstraps, right?   Yes. It's it's, you're gonna get there except   that,   you know, when I went to school,   it costs me $2,400   a semester.  

And now it's $30,000   right? And,   you know,   in the United States, and now actually, I think they just are starting it in Canada with, like, fixed term mortgages.   That was in the United States. That was your wealth building tool. It was, I could buy a house now   and keep my payment at nowadays payment   30 years from now. Right? Like, it's it's a it's it fixes your housing cost,   which is a huge economic driver. Right? Because Yes. Like, I remember when I bought my house in the United States,   we bought it on a short sale kind of, you know, when economic times were not good. Right? During the credit crunch time. Yeah. And we had that payment at, you know, 2.25%.   It was like unheard of for a mortgage. Yeah. Yeah. I know.  

So, you know, but 10 years later, I was still making that same payment. Yeah. Right. And that was, it was a joke. Like you couldn't even rent 1 bedroom apartment for   for how much we're paying for a house. Right. That is a huge economic mobility factor.   Right.   And, you know, inexpensive education, right. That you mentioned education or free education   in some instances. Right.   But also, you know, health care is a big one. I remember paying an ungodly amount of money for her for,   you know,   that people in Canada, the UK can't even imagine.   You know? No. It's like It's crazy. No. I think   it cost us about 9 or $10,000   to have our daughter,   right, in health care costs.  



[00:19:10] Paul Summerville:

And that's with insurance. Right? So Let me let me just jump in there for a second. So so so there's a few things.   One is, and we look into this, Eric does a diagnostic   of the United States   and France and the UK   and Italy with his, the tools they have at the Harvard Growth Lab to kind of disentangle   why social mobility is so low in those four countries. And the reasons are different, and that's a very important thing. There is no one thing. For example, if the Italian government wanted to spend, say, $20,000,000,000,   we would argue that they shouldn't graduate any more university students because their economy doesn't absorb them. It's a little bit like the Philippines.  

Right. So each country has a different set of issues that generating   sustained upward mobility,   creating the architecture of equal opportunity and fair and equal outcomes is not easy. It's a it's a it's a it's a complicated   multilevel challenge, which is why not a lot of countries get it right. So the diagnostic is very important. And the other challenge   is that fairness is a moving target.   And fairness is a moving target because of the way that new technology   changes the structure of the economy, which creates immediately   big winners and big losers.  

Right. The challenge for the political system is how do you mitigate that in such a way   that the big winners are paying whatever the whatever   number you wanna put on it, fair share of taxation   so that the big losers have a chance   either to get back on the social mobility ladder or their children do.   And if you don't get that right, and it wasn't it hasn't been right in the United States for 25 years. It hasn't been right in the UK because of the geographical issues here. It hasn't been right in France because   even if you work hard, unless you're part of the kind of economic aristocracy, you can't get rich in France no matter how hard you work, particularly if you're a middle class.  

That then the political system gets taken over.   That's what Joe Biden talked about last night in his, in his farewell address, that this oligarchy,   has taken over   the US government   and has been and has created a whole set of tax rules for for their own advantage. This has actually been going on for the last 30 years.   So Yeah. It's just more obvious now. Well, it's more obvious because it's playing out now, you know, because now we're seeing it, you know, live and in color. Yep, Paul. As as an aside on that, Paul, just just quickly,  

[00:21:35] Matt Rouse:

there's a lot of talk about like   conspiracies   of the like ultra wealthy, right? They're all over the internet, everywhere you go.   And there's like, they're gonna have the 3 richest people in the world sitting on stage with the president. And I don't know how much more rich person conspiracy you need to have. Like, there's no like, you don't need to guess about that. That is not a like, you just you just look at it. You're just like, okay. There's the rich people. Right? Well, there's a difference between  

[00:22:03] Paul Summerville:

a conspiracy, which means somehow that, you know, for for now and for all time that these people are gonna control outcomes. Right. As opposed to rich people having   political leaders' ears. I mean, that's always been the case. I remember I ran for parliament,   in I ran twice. I ran in 2,006   and 2012.   I didn't win. Thank goodness. I only wanted to be a candidate.   But I was charged with,   debating Jim Flaherty, who was Steven Harper's finance minister, and his brother David lived in Victoria where I lived.   And I caught wind of a of a a lunch function   that his brother was putting together for Jim, and the engine fee was $10,000.  

Right. You know, so if you wanted to sit down and meet the, you know, the finance minister,   you would write a check for $10. Well, I mean, if you had an issue around some, you know, tax issue   with an income trust or with some oil company you invested in, I mean, that was that was the guy to talk to and then and there. So that's always kind of been there. The the the point is   that the if you do not put economic fairness first,   then when the economy goes through that tremendous change, which it's which it's been going through quicker and quicker because technology   impacts the economies quicker now It's about getting it faster.  

Well, that's the point. And and AI is, you know, which you're an expert on, and I'm learning courtesy of you,   that that the political system then gets gets twisted.   And, of course, then the rich thing that, well, they're, you know, they didn't they didn't get rich because of the way I think I did, you know, mostly because of the opportunities I was afforded by Canada because they were really smart and they worked really hard and they deserve everything they get. And you you should just, you know, follow the American dream if you really work hard, everything will work out for you. Right? As if Right. They're not just lucky.   That's right. And Your parents didn't have an emerald mine or something. Well, then Trump's a classic case. Right? But there there's 2 other bits of this, which is very important, which is why   the risk to social democracies, which is in a were a real risk now. I mean, there's this is very scary. I've I've told a lot of friends what they should be listening for is Trump talking about running a second term. Watch   them even though it's against the constitution.  

Right. In fact, Bondi was asked by one of the senators yesterday   yesterday at the hearing and her,   her hearing that, you know, whether she would support   Trump running a second time, how she would handle that as attorney general. She had a stock answer ready.   So once the political system gets twisted in this way, then you start to have social and cultural   impacts.   And and then it becomes deeply ingrained in the culture   that, you know what? You know, if you don't, you know, it's really your fault.   You know, it's, of course, you know, you   medical care could be free and education could be cheaper,   but it's it's it's it's really up to you to kinda figure this out. And we're we're we're very we're moving into that   that space,   and that's very, very dangerous. Because   in the end, people, they don't they won't put up for it at some point. But you don't know when that's gonna happen. Right?  



[00:25:04] Matt Rouse:

Well, there's this the the talking about the speed of technology changing in AI, I was literally writing about this this morning in my book. So I'm writing a second version of will AI take my job.   It's called will AI take my job too.   So it's kind of play on words with 2 and a number 2, you know?   Anyway,   so I was listening to an economist on, on one of my podcasts the other day. And, I, his name escapes me right now,   but he was saying that probably starting next   year,   AI is going   to shape the economy   by about 10%.   Right. I like like a 10% increase   in economic output   by companies that are using AI and most corporations by 2026 will be deep in it. Right?  

Absolutely. No problem. Gonna be 10% doesn't seem like a whole lot, but it's gonna be 10% per year for 3 to 5 years in a row. On common.   Right? Right. That means by 2031,   50%   increase in economic output based on AI,   which is more than the steam engine, more than the industrial revolution.   Right? More than anything we've ever seen before, but it, it seems it won't seem   like a lot because it's, it's a little bit at a time.   Right? It's a it's But then it's gonna like come out of nowhere. It's gonna just be like everyone   waking up one day in, you know,   2010,   2011 times, and every single person around them has a smartphone. Yes. And they're still on a flip phone, and they're like, what am I doing? How come everybody else has got one of these other boxes? Away in the garbage can. Right? Right. So  

[00:26:45] Paul Summerville:

I think it was Warren Buffett who said something like   in 1905,   the the business that you wanted to disin disinvest yourself from in the United States was anything to do with horses.   Right.   Anything to do with horses. Because of what was gonna happen in the next 15 years with the invention of the automobile. So, I mean, if you were gonna write a novel, you know, you'd have some guy, some son of a of a company that makes horse paraphernalia saying to his dad, you know, I was in Detroit, and I saw this most you know, the intergenerational   conflict about giving this up. I was in Tokyo in 1980   84,   and I was doing my doctorate, and I was doing some part time teaching.  

And I was trying to explain   to the classroom   how the world   changes because of technology.   And this, of course, was just when, like, home computers were coming out. Could you imagine? Right?   And, I had just written my master's thesis on a computer at the University of Alberta, and I it was this huge computer room with, like, a 100 terminals. You'd go in there and write, then you'd have to go to the   across the campus to get, like, a printout of your Right. Of your thesis. Right? Big dot matrix printout?   Exactly. Exactly. 1981. Right? And as I was trying to explain this, there was a typewriter   sitting forlornly in the corner.  

And I said, that's all you have to think about. Every time you wanna think about how does technology change the structure of the economy, Think about those that company, the people that work there,   the the villages, the cities, the towns, the distributors are dependent on that particular technology, which is gonna   disappear within the next 3 years. No one's you are not gonna be writing   your your   your essays and your papers and your letters, any kind of communication on that thing anymore. And, of course, who could have imagined, you know, where we are now. So this is very important for people to keep in front of them at all times. And it's why, you know, people like yourself who think about innovation, embrace innovation,   put it into their daily lives, write about it, processize about it, you know, that   technology   is the key. It is the driver of economic change. And you need to understand that   and always understand just like in the industrial revolution, just like in the 19 twenties, just like in the 19 fifties, and just like we've experienced the last, you know, 10 years, that new technologies   completely restructure the economy.  

And people who work hard and save and invest and have studied and are disciplined,   all of a sudden they have a set of skills like for example, here in the UK,   they have barristers and solicitors. So a barrister is someone who goes to the bar and argue. They get to keep their job. Right? But the solicitors, you go and do all the work in the dusty   bookshelves, they're gone. They're they're they're toast. Right?   My niece got a accounting degree   and soon realized   in in 6 years, the skills I've learned, I'm not gonna need anymore. So now she works for, you know, one of the big tech companies.   So the fact that  

[00:29:46] Matt Rouse:

understanding   how it works   at an expert level  

[00:29:51] Paul Summerville:

is just as important as understanding that a machine is gonna take over most of those tasks. Yes. Absolutely. Somebody's gotta tell it what to do. Yes. Absolutely. I mean, the the there's always human interface. Right? I mean, we we know that. But the point is is that how many hours of human interface do you need? Very little. Right? I mean, we we can talk about the project we're involved in about AI translations.  

[00:30:15] Matt Rouse:

Right. Well, I was gonna get to that in a second also. I wanted to mention to kind of something interesting. I went to,   icon. It's the marketing AI convention in Cleveland every year and shout out, you know, if anybody is in AI and marketing, you should a 100% go to that.   Anyway, they had, one of the speakers was Cassie Kozercov,   and she is the   she used to be the chief decision scientist for DeepMind at Google. Right?   Deep in in AI, like as deep as you could get pretty much. Right. Right. She had this presentation and she started it off with this story   about this job that was called knocker uppers.  

The knocker uppers were these people with these huge long sticks, right? In London, where you are now. Right? They used to go around and tick, tick, tick, tap on people's windows to wake them up for work in the morning. Yes. Right? And the alarm clock came out and all the knocker uppers disappeared.   And nobody nowadays goes around going, man,   I really wish we still had those knocker uppers, you know, like like nobody even knows what it is. It's just it's a job that disappeared because of a technological change. Yeah. So so let's think about solicitors for a second. Like, who really wants to go, you know, you spend,  

[00:31:25] Paul Summerville:

you know, 7 years in university and then you're you're told, okay, I want you to go through 650   years of of precedent and see if you can find one line that, you know, will make my client, you know, not guilty. Like, do you really wanna do that? Right. So absolutely. I mean And I mean, that's a job. That's job made for AI. Right? Because not not being the solicitor,   doing looking up the 650 years precedent is the AI job. But instead of needing an army of solicitors, you just need the smartest one. Right? Right. Who's then gonna look at what the AI produces and go, oh, here it is, you know, line number 3,607.   But   we technology makes our life   largely   better. The challenge is, how do you manage the economic   and the environmental   and the social   disruption that's created? I mean, honestly  

[00:32:13] Matt Rouse:

Well, I was gonna say that that I think that there has to be some form of UBI, like universal basic income or or general basic income   that has to come into play   probably sooner than later. You know, I'd say by 2030.   If it's not,   there's gonna be a serious problem because there is gonna be a shift where you've got just like you were saying, I don't need everybody who's in this this occupation now. Right? And all of the support staff that go along with it, I just need the expert.  

[00:32:45] Paul Summerville:

And when you just need the expert and you don't need the other 30 people that support them, that's a problem. Right? So this is so you've your insight's very important, and we talk about this in the book. Now I'm a big advocate of what I call big, basic income guarantee.   Eric's less so, so we didn't put as much in the book as I would have liked to. We could put it off to the side because the book wasn't about that. But,   Eric came up with some really interesting research around the impact of the China shock,   the China trade shock on the United States and Canada.  

And in Canada, about 70% of people who were economically upended by the China shock were able to move on with their lives,   find new jobs, and in many cases, better, more high paying jobs. In the United States, it's closer to about 10%, 10, 50%, very low. And that's because the state supports didn't exist in the United States to help those people. Yeah. They're free training.   That's right. And and in fact, Eric was interviewed by a guy named Brian Crombie. He's got a show   out of Toronto.   And Brian was a adviser to Mulroney   when they were talking about the free trade agreement. And he he strongly recommended a basic income guarantee   because of the shock that was going into the company. Ultimately, they didn't do that, but they enhanced some of the things that were currently kind of in play. The biggest problem, unfortunately,   with a big basic income guarantee,   which has been a problem since it was recommended by Thomas Moore in his book Utopia,   and even when Thomas Freeman talked about it in the Chicago School in 19 fifties Right. Is that people cannot get past the idea   of someone getting something for doing nothing. Right. Why are they doing nothing?  



[00:34:23] Matt Rouse:

That's the here. And I have the answer.   You know what they're doing?   They are buying things   and they're buying the things they need to survive. And that's what creates the economy. That's what they're doing.  

[00:34:35] Paul Summerville:

I completely agree. It's a misunderstanding  

[00:34:38] Matt Rouse:

how public goods work. Well, there's also there's also people who say, especially the United States,   they say, why should I pay for someone else?   And the fact is, if you're also getting the same amount of money, you're not paying for someone else. Right? Like they say, oh, well, I work and I pay taxes. So why should I pay for someone who's not working? It's the same as the welfare argument. Right?   But   the, the thing is   their contribution   to the overall tax compared to the top 0.1 percent of people in the country is   infinitesimally  

[00:35:11] Paul Summerville:

small. Oh, no, absolutely.   Right? Absolutely.  

[00:35:14] Matt Rouse:

So, like, think about   one person right now   who is in a unicorn like a a unicorn startup company Yes. Of which there's been 100. Right?   They are I think it's somewhere in the neighborhood of 36,000   times   more, like, economically   productive than the average person.   So   do we need the other 35,999  

[00:35:39] Paul Summerville:

people to be super productive? Or can we be, like, here's some cash so you don't go broke and starve? Well, so so but let's let me just finish the thought about how how one has to think about public goods. Right? So, again, you know, the argument against it, it's not what I'm arguing. I'm just saying this is the argument is is that we don't wanna give people some for doing something nothing. The point is, sure. If you have a public good, there's always gonna be pick a number, and it's usually around 10 to 12%   who take advantage of the system, but that's not the point. It's the 90%   for whom that little cash infusion is completely life changing. And all of the basic income tests that have been done consistently show this, And they consistently show by talking to the people, 1 on 1,   walking through how did this change your life. Well, I got my teeth done. I hadn't been to the dentist for 7 years. Now I got my teeth done. I felt more comfortable to go to a job interview. I was able I was able to move closer to work.  

So I didn't have to now pay a babysitter to come and take care of my my 5 year old because instead of being 2 bus transfers to work, I could get back and forth in 35 minutes. I needed a car. I got my car fixed. And now I could drive, you know, so the constant,   constant stories over and over again, ways that   economists   and legislatures   can't really imagine.   There's so many   small, granular ways that this can have a powerful positive impact on someone's life to move them up the the ladder to increase their social mobility.   I'll tell you a quick story. When I ran for parliament the first time, I ran for the NDP. So I was the chief economist of Canada's largest investment bank, RBC Dominion,   and Jack Layton recruited me. And, you know, my bias was towards equal opportunity.  

I wasn't very happy with the Liberals or with Stephen Harper, so I went and did it. And it was a it was a December campaign. We're up to our asses in snow most of the time. It was incredibly long. Right. And one one morning, I came into the campaign office and my campaign manager, Chris Watson,   said to me, Paul, we got a couple of LSC PhD students   to go out and and and campaign with you today. And it was a it was a morning door knocking starting around 10:30. Those are the worst. You might get, like, a 10% doors opening. Right?   So we knocked doors for about, you know, an hour, and we got to speak to about 6 people.  

And about halfway through, trudging through the snow, one of them turned to me, the the the boyfriend   of the girl turns to me and he says, you know, Paul, I want to let you know that we are both fundamentally,   ideologically   opposed to your candidacy. Right?   You know, because you work in finance. We are we could, you know, they and they were like Trotskyites. Right?   So I had this in the back of my head, and finally, I just said, guys, you know, let's go let me go buy you lunch. And we were at Bathurst and Eglinton. There's a big Loblaws. They're a huge Loblaws Superstore in Toronto. Anyways, we went for hamburgers. And when I made sure they have, like, a lot of food in their mouth because they hadn't eaten properly in, like, a week, I said, you have no idea what you're talking about. You have no idea how the market works, and I'm gonna show you. So I took him to Loblaw's,   and I took him to the I took him to the sauces section,   you know, ketchup and and Heinz sauce and mustards, like 250   different sauces. And I said, that's the marketplace.  

Behind every one of those is a person,   you know, 75 years ago whose wife came out with an interesting recipe and they got 7 people together. And behind those 250 are thousands of companies that never made it. Right? But that's the genius of the market that it can create that kind of diversity. No bureaucrat,   no single person, no single company. It's why we don't like monopolies   could think and imagine those kind of things. And it was interesting to watch his eyes because I could see, you know, it was kind of kind of getting past and then that kind of max smart door came down. Boom. You know, the ideological iron door came down and they couldn't think about it. So it's the same thing talking about a basic income guarantee.   You need to you need to understand how it how it raises people up. And and you're absolutely right. As we move through this tremendously   disruptive phase   that AI is gonna present at a time when we already   are trying to figure out how we're gonna manage and reach out to these enchanted voters,  

[00:39:57] Matt Rouse:

we got a lot to worry about. 3rd, I think there's there's some answers to some questions that people have. One of them is   what is left for photographers   and artists and videographers   and voice actors and all these things that happen that AI is already   disrupting. How are they going to make money? Why do we need AI in the 1st place? Well, the answer to how they're going to make money is universal basic income.   You know, can we pay people   to make art?   Right. Like   I'm okay with that. Can we pay somebody to learn how to play guitar? That would be great because you know what? I'd love to guitar playing. You know, like depending because because Margaret Thatcher introduced an entrepreneurial  

[00:40:36] Paul Summerville:

scheme in 1986 or 87. We talk about this in the book.   And what happened and which encouraged people to become entrepreneurs and encourage people to do whatever it is they did. And an artist kinda figured out, wow.   And it's the whole reason for this cool Britannica thing.   It it completely   changed the art community in London, the music   industry. All of that was based   on Thatcher's entrepreneurial   programs, which no one in a 1000000 years thought that that was gonna be the outcome. So so you're absolutely right.  

[00:41:07] Matt Rouse:

Right. Now and I don't wanna be the doom and gloom guy, but we shouldn't talk about the doom and gloom side of of, you know, job disruption.   And the biggest thing I think here, and I and   I think this is a really easy example, and I've used it before on the show, is that   when people   were able to get the phonograph   before that, if you wanted music in your house, you had to play the p right?   You played the piano, somebody else, you knew sang a song or you sang and played the piano and that's how music happened at parties in your house, or whatever. Right?   But now the phonograph comes along. Everybody's getting a phonograph. Nobody's buying pianos anymore.  

So everybody's getting laid off at the piano factory. Well, if you could build a piano, you could build a phonograph. So they take them across the street, you retrain them for a day, now you're building.  

[00:41:53] Paul Summerville:

Exactly.  

[00:41:54] Matt Rouse:

Okay.   Now   if you're a middle manager, a knowledge worker of some kind, whatever your job is done, like, completely over the Internet remotely,   it doesn't have privacy and trust components that don't fall into kind of the AI world, then AI is absolutely suited for your job.   Right? Maybe even more so than you are. Right? Because I'm sure of it. There are a lot of people who their job is, like you were saying, look back at 650   years of legal precedent for one line.   Well, the AI data, you know, analysis system is way better at that than people than in groups of people. Right?   So   what happens is   you and everyone else in that kind of   of sliver of that job market that you have,   they all get laid off and a percentage of those people stay on because they gotta be the decision makers, the one who run the AI.  

You know, those people stay on with their jobs.   But the same thing is happening at all the other companies, and the same thing is happening in all the other sectors.   So all of these people are starting to get laid off at the same time, which means now it takes longer to find another job.   You know, you can't just get   retrained from being,   you know, a data analyst to being electrician.   Right? It's just not   the same thing. So so the disruption there is that there's almost no way to retrain everyone.  

[00:43:22] Paul Summerville:

So just really quickly, the movie hidden figures that I'm sure some of your audience has seen about the the African American   computers, they called   them mathematicians   who NASA hired.   And they were doing all the work that IBM   Computers replaced.   And a very smart woman who is actually now quite celebrated in the history of NASA   figured this out,   learned how the machines work, took all our ladies,   and they became   very important in managing the computer. So so she understood that, right, and understood what had to happen.   The   the the challenge is is that the   the disruption that occurred with the fall of the Berlin Wall in 1989   when China and Eastern Europe came on to the global markets and then followed by South, Eastern   Asia   was market driven. All of a sudden,   someone who   it was being paid $16 an hour, $20 an hour with benefits to do a job in Michigan or in Windsor,   you could pay someone a dollar and a half, you know, to do it in China, and they produce, you know, just as just as good or good.  

So there were there that's a much more kind of gradual transition. Right? It doesn't happen overnight. It probably and it took about 10 years for it to kinda work its way through. But the AI challenge is it's it's an avalanche   of people who are gonna be facing this challenge.   And there are people who   are 37,   you know Yeah. 41.   Now where are they in their life? They're 7 they're 7 years or 8 years into their 25 year mortgage.   Their children are 11   and 9   and maybe 3,   and they wanna play hockey   and they wanna have lessons, and all of a sudden, the tap gets turned off. Right. What's daddy gonna do? Or daddy and mommy because it's usually 2 income households now. Right? So this is coming like a freight train. And, you know, with the hearings, it was so interesting to hear some of the questions. It's all about, you know, gender diversity and where do you think trans people should be? I mean, all that's important,   but there's some really, really big stuff that's going on   that, you know, you need people like yourself trumpeting   what the risks are. And I think it's a little bit like climate change. The difference is climate change is gonna take 50 years, although there are episodes like the Los Angeles fires that remind us or what what I lived through in Victoria when it was 50 degrees for 3 days. But this AI   AI revolution   is coming   right now, and it's gonna be really, really fast. And I It's already happening.  

Yeah. And and the answer to your question   is the prop   I I get often asked about with the book. People would say, well, I mean, how do you think this is gonna play out? And I said, one of the biggest   fears I have is that we're gonna find out that the problems are bigger   than the political systems   we designed to deal with them. In other words, the problems are so big that we just don't have the political system. So it's not just, you know, having run as a candidate. And I and I know a lot of politicians. You know, a lot of people go in for the right reasons.   Most of them are really smart. I mean, you don't just show up and run for parliament. Right? Right. But a lot of times, politicians are just overwhelmed, I think, because   the size of the problem   is so overwhelming. The numbers that you're talking about and the speed of change. Right. And then how do you how do you sell your constituency  

[00:46:43] Matt Rouse:

on a problem that they absolutely do not understand?   Yeah. Which is also difficult. Right? Well, okay. Think about it. Think about it for a second. In Canada and the United States, roughly, I mean, there's a difference. It's more in the United States, but of   nearly 50% of people, I think it's 46 in Canada, 54 in the United States, their reading comprehension level is 8th grade or lower. Yes. Right? How do you explain,   like, the cascade effect of job loss because computers can think through processes now and data analysis   at, you know, an unimaginable   scale to somebody who can understand everything in a Harry Potter book?  



[00:47:23] Paul Summerville:

So excuse me for so there's a great moment in Primary Colors, another great movie that your your,   listeners may be familiar with. So John Travolta plays Bill Clinton, like, just perfectly.   And he's dying of a cold, is being attacked because of his, his affairs out, you know, that are now becoming to light. And he's in a he's in a room with a bunch of kinda New England fishermen.   Right? And in very simple terms,   he finds a way to explain to them that there's not much the government's gonna be able to do for you.   Right? You   what you've gotta do, and we we can help you with some of these things, but you've gotta relearn. You've gotta go back to school. Right? And it was it was beautifully done   because I really think that is the function of a politician   to try to find   the right kind of language,   the right metaphors, the right stories   that help people understand that. And I and I wanna even though I would agree that the pace of change   is gonna come very fast, this has always been a problem. This is right back to the Luddites, you know. Right? This has always been an issue. And and Steve Paikin, a show I was on to talk about my book, the agenda, which you can see on YouTube,   he was very good at kind of filleting this out of me about the importance. It's one of the themes he picked up on the book that how economic fairness is a moving target.  

And it's a moving target because of technological   change.   And the problem now is that we have politicians   who don't care about that kind of stuff.   They've done other things that they wanna talk about   and aren't willing to accept   that the problems that we face right now from climate change to AI   to low social mobility   to declining   birth rates. I mean, there was this there was   a article in the Financial Times today about productivity in different countries. The kind of productivity   required   just to keep the economy growing at 0   because of the collapse of the labor market in countries like Japan, Spain, Italy. I mean, those countries are are gonna disappear.  

I wrote a piece in 1991   called something like Japan is running out of Japanese because you could demographic trends are really easy to kind of forecast.   Right. So imagine having that problem. So   these are the the we need we need the people who can find those kind of language. They they sometimes emerge, but they don't always emerge. Right now, we don't have them. Yeah. And I mean, when you have populist people who are essentially elites  

[00:49:48] Matt Rouse:

telling you that the elites are the ones who are the cause of all your problems   and the actual cause of all your problems   is, is, you know, social mobility policy.   Then, you know, who is gonna tell people that? Because, I mean, this is not a popular message to go against the populist. Right? I mean, that's Well, unless Right? But again, it's if you go back to our book and if you read, you know, the look at the conclusion  

[00:50:12] Paul Summerville:

where we say there is a script. Right? And the script is to start with economic fairness,   talk about fairness. And that was Kamala Harris's opportunity, and she didn't because she doesn't really understand it as best as I could tell. I mean, it's interesting that Mark Carney kinda touched on that in his interview with John Stewart. Right? About about thinking about fairness. Let's get I don't know if he's read our book or not. We sent him a copy that that you have to put economic fairness first because if you put that first, then it creates a conversation about the kind of policies you need, how you have to be smart about   unemployment insurance, how you have to be smart about taxation, how you have to be smart about national day, childcare.  

All of those things that   are are are created by that. And I think, you know, another  

[00:50:56] Matt Rouse:

another   kind of problem with some of the political things that we've seen in in recent years   is I think a lot of the polling is being done around   what topics are popular with the people that are in the base of that party.   And it's the same idea as,   you know,   like, if you ask people what they want, they're gonna tell you they want a faster horse, right, Instead of building a car. And   so   like,   I think that there's, there's a missed opportunity to say, let's change the script from what everyone else is saying, including our own people  

[00:51:37] Paul Summerville:

Yes. And  

[00:51:38] Matt Rouse:

say, this is the path forward.   This idea of economic fairness is where we need to go. Right.   And and just hammering that message. Right. And I think that's something that hasn't been done.   And, you know, I wanted to actually you know, we're kinda a little past our our originally, you know, time that we were gonna chat, but I didn't wanna to kinda skip over this.   Is that when we were talking about the change of over to AI technology,   right, for a lot of industries,   we work together. Right? We have a a startup,   Kanji Accelerator,   right, that we're working on. Yes.  

And the conversation in our group, and I don't know if you noticed this, but the conversation on our group was we need this video to come out in 8 languages.   Yes. So we're gonna use the AI to to translate it  

[00:52:29] Paul Summerville:

Yes.  

[00:52:31] Matt Rouse:

And to do the voice over   was the first option that everyone picked. No one said, let's go find voice actors in each language, and then maybe we'll try the AI. The first thing we did was say, let's use the AI first.   And no one even made a conscious decision.   Right?  

[00:52:48] Paul Summerville:

And the reason is I think you have we're lucky because we have 6 people including us on our on our team.   I wanna get to the right place   in the quickest,   most efficient way. And so we've got 6 people who think about efficiency.   And Right. You know, a lot of it is you and Doug   who were able to articulate very clearly with examples  

[00:53:10] Matt Rouse:

about how this works. And 2 years ago, none of us would have said that. Oh, I mean Right? I think I think 6 months ago, I probably wouldn't have. You know? This is the change. Right? This is the change happening in real time without people realizing it. I in in in 2013,  

[00:53:26] Paul Summerville:

I I was involved in another start up, an amazing Iranian tech guy. And and I didn't I I didn't have an iPhone then.   And so I got an iPhone, and I remember asking him,   what's an app?   Right? And he was really beautiful because he could've just, like, you know, Paul, for goodness sakes. He said, it'll make your   telephone online experience more enjoyable was his answer. Right? Like, the perfect answer instead of you idiots. Like, give me a break. So, yes, I mean, I think it was a very natural answer for all of us because it's out there. Right? I mean, it's it's it's ever present.   And if you're, you know, marginally involved   in thinking about   communicating with people   and also how do you process information and how do you get information.  

In fact, before we even met, I was testing   videos that we're making. So Kanji Accelerator is designed to help people   learn   Kanji   very quickly, but also give them the tools to remember it because it's based on a kind of a story storytelling methodology  

[00:54:29] Matt Rouse:

rather than rote learning. Right. This is a Japanese  

[00:54:32] Paul Summerville:

dialect basically or or script language. Right? So kanji originally were Chinese characters, and 4000 years ago,   the Japanese didn't have a written language.   And, you know, someone who went over on a boat said, well, we'll just so they brought it into Japan. And, of course, it's been changed over the years, but there's 2,100   and so characters that the Japanese children need to learn and any fluent speaker of Japanese is required to learn. Unfortunately, they're taught very badly. They're taught as rote memorization   rather than using the storytelling method.  

And so the the challenge then is, well, how do you how do you present this? And so I found an app called AI video,   and it was an app where you could make videos. Now the AI that it actually produced around the characters was a lot of fluff, which is kind of an issue. Right. But here I was using AI to do the the narration   and make some of the pictures that I was being used. Oh, I soon soon realized, that we're gonna have to move to, you know, professional animators, which is we brought in Jock to do that.   But, the fact is is that I think anyone who's thinking about building a company today, I think AI has to be the very first thing you ask yourself. Right? So when I was running research for Lehman Brothers in Asia,   I had a team of, you know, 30 analysts and, you know, they all wanted to do their their spreadsheets and their models and stuff. And I said, you know,   okay. I mean, sure. But who really cares about it? Because you've got 9 other people that are doing the same thing. The question I have for you,   and this was this was   1993.  

It's a different question today.   In 5 years, what company, what technology   is being developed right now that will bankrupt the companies that you cover and have a buy on? Right? Well, now it's not   5 years. It's 2. Right? In the next 2 years, what technology is gonna come along and bankrupt the companies that you wanna put our clients into?   And so I think any start up, any company needs to ask itself, okay. Where is AI? So maybe if you're a plumber or a carpenter,   AI might help you with 9% of your work. But if you're doing Kanji Accelerator, it's probably pretty close to 60   or 70%,   and you need to embrace it. I mean, that's the other thing about technology. It's like, you know, when I got my phone   and I Dean said, okay. You know, put these apps in here.  

You can, like, say, well, I'm not but or or do you embrace it? And say, I'm gonna I'm gonna make this part of how I live. And I think that's a really important message for companies.  

[00:57:02] Matt Rouse:

Yeah. I'd say quarter people now who have a smartphone don't even use it as a phone. Like, they never call anyone. They use an app to talk to people. Right? Yes. Yes. Very true. In a lot of cases, there's no reason to even have a phone number on it except for the fact that the cell companies don't make any money if you don't  

[00:57:18] Paul Summerville:

phone the person.  

[00:57:20] Matt Rouse:

Or call them well, yeah. Very true. Yeah. You know, with AI, I think about it and   and and I put this in the will AI take my job book as well. It's the the rocket ship problem. Right? Yes. And it's   we, we launch a rocket ship to a planet. It's gonna take a 100 years to get there.   Right?  

[00:57:37] Paul Summerville:

Right.  

[00:57:38] Matt Rouse:

20 years later,   we build a faster rocket ship. That's only gonna take 40 years to get there. So it arrives 40 years before the first one you launched. That's beautiful. This is the thought you have to have is Yeah.   If if AI doubles in productivity every 18 months   and I start my project now, is the AI already gonna put me out of business before I finish my project? Well, this is why I like working with you so much because you just embrace  

[00:58:02] Paul Summerville:

the the reality of of the of the technology   and understand that the only way you get richer   is by increasing your productivity.   And so how do you   get richer, but how do you share the wealth in a way   that's fair so that other people have a chance or their children have a chance to do the same thing? That's we've got 2 big challenges that we have. And that's the UBI side of it or, you know, what'd you call it? Big basic   Basic  

[00:58:29] Matt Rouse:

income guarantee.   Right? Yeah. That's good. I like big. I also like UBI just because I've heard it so much. But It just sounds like it it sounds like Obama's in lad bin Laden. That's the only thing that makes me feel   that's right.   So, Paul, if if people wanna get more information, what's the best way for them to reach out to you about the book and, about Kanji Accelerator?  

[00:58:51] Paul Summerville:

Well, it's kind of you to ask. The book is available   on every site, Amazon, all bookstores.   It's also available on audio audible.com.   So that's a great way to get the book. You can learn a lot about the book just by going on YouTube   and Googling reclaiming populism   with my name. We did a number of presentations at LSC and Harvard and places like that. The kanji accelerator,   if you're interested in   learning   Japanese characters, if you're interested in what we're doing, then you can simply email me at paul@kanji,   k a n   j I, accelerator   dotcom, or you just look me up on LinkedIn  

[00:59:31] Matt Rouse:

and message me, and I'd be happy to speak with you. Paul, I appreciate you taking even the the extra time to talk with us today. It's a great conversation. I think I think people are gonna be, you know, their mind is just gonna be like   after listening to this event. So, it's great talking to you. Matt, thank you very much. Talk to you soon.  

[00:59:52] Narrator AI:

Thank you for listening to the digital marketing masters podcast cast with your host, Matt Rouse. If you enjoyed the show, please leave us an honest review on your favorite podcast app. Be sure to check out Matt's book, will AI take my job, and have a wonderful day.  

[01:00:11] AI Singer:

Our guest is Paul Somerville.   He is the author of the book.   Reclaiming   populism,   it's all about   with your   with your host,   Matt Rouse.