Will AI Bring Utopia or Dystopia? A Venture Capitalist Picks Utopia: Vinod Khosla says artificial intelligence will cause great abundance -- more than enough to share.

"The future of AI is in many ways a blank slate -- a place where many people place all sorts of fears but where many investors see all sorts of potential.

To explore the utopia vs. dystopia scenarios, The Wall Street Journal's Jason Dean spoke to Vinod Khosla, founder of venture-capital firm Khosla Ventures, at the Journal's Tech Live conference. Here are edited excerpts of the conversation.

WSJ: The venture-capital startup world is still in quite a slump after a long expansion. You've been a tech investor and entrepreneur for more than 40 years. How do you see this current state of affairs?

VINOD KHOSLA: We saw a lot of excess in investments. But investors who are disciplined did well. We're seeing the same in the AI hype cycle. One still has to be disciplined. I like to say most investments in AI today, venture investments, will lose money. But more money will be made than lost if one is disciplined early and thoughtful about where to invest.

WSJ: You were the first outside investor in OpenAI; I think $50 million at about a $1 billion valuation back then. Earlier this year, it was about $30 billion. We reported recently that they're planning a share sale valued at nearly $90 billion. Is it worth $90 billion already? Where's the ceiling?

KHOSLA: When I look at the landscape for AI investments, the most valuable thing is not software. It's human beings with big expenses [that AI could reduce or eliminate]. If you take a million doctors and each makes $300,000, that's a $300 billion expense, just in the U.S. alone; probably 10 times that, globally. Those are trillions of dollars. If you look at accountants, you could count the same kinds of numbers, trillions of dollars spent. I believe AI will be able to do, within 10 years, 80% of 80% of the jobs that we know of today.

WSJ: Will venture capitalists be replaced?

KHOSLA: I can't say they won't. It's very hard to predict. But anywhere we rely on human expertise, AI will have that expertise better, and it will have broader information. Take an oncologist treating a patient for breast cancer. It's very unlikely that they remember the last 5,000 papers on a certain breast cancer. But the AI will know that, and the AI will prescribe the right treatment for the patient. It will be a much better oncologist than the oncologist.

WSJ: When you talk about 80% of doctors, 80% of accountants, etc., being replaced or potentially replaced in as little as 10 years, is that a good thing?

KHOSLA: We've gone through that transition before. In the early 1900s, the majority of jobs in the U.S. were in agriculture. By 1970, it was 4%.

The biggest problem is that AI will cause great abundance, great GDP growth, everything economists love -- and increase income disparity. The good news is, if [AI allows us to] change GDP growth, say, for the next 50 years, from 2% to 4%, there's more than enough abundance to share.

WSJ: A lot of us watch science-fiction movies that are described as dystopian and say, "God, I hope that never happens." People in your industry seem to watch them and say, "I'm going to make that happen." What is the disconnect?

KHOSLA: Is it fun to have a job working at one assembly line at an auto plant for eight hours a day, for 30 years, screwing one type of wheel on? It's not a fun job.

[We will even be able to give people] free therapists. The first large language model AI therapists got approved in the U.K. for one of our companies. It's now doing intake at 33% of all mental-health clinics in the National Health Service. And the quality is, I believe, higher. When you have humans, the level of consistency in medical care is so varied.

WSJ: I don't want AI that makes stuff up to be giving people psychological advice.

KHOSLA: Even an AI needs to know when to call in a human specialist. That's why I say 80% of these jobs. There will always be a human element. And humans will be free to do fun jobs.

AI can do more for humanity in creating a utopian world and world of abundance. I grew up in India and I saw people without homes, no access to medical care, no access to transportation.

So, I have a view everybody should have access to 24/7 medical care. Every one of these kids should have a personal tutor available to them. These are real capabilities that AI can offer." [1]

1. Technology (A Special Report) --- Will AI Bring Utopia or Dystopia? A Venture Capitalist Picks Utopia: Vinod Khosla says artificial intelligence will cause great abundance -- more than enough to share. Dean, Jason.  Wall Street Journal, Eastern edition; New York, N.Y.. 24 Oct 2023: R.10.