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At the ÉNA Course for Higher Public Officials in France

At the ÉNA Course for Higher Public Officials in France © Office of the President

23.01.2019

Ladies and gentlemen!

Somewhere ahead is a bifurcation point. Either we will conquer climate change, or we will not. Unless we take radical steps, climate change will be uncontainable, and certainly irreversible.

Technological advances are tackling the problem, but in the absence of a global political effort, the trickling down of this change to every CO2 emitter is too slow and also economically painful. Taxing CO2 emissions sends the market the right signal, but obviously frustrates small-scale consumers, including petrol-station customers in rural France who are unable to change their energy source. They can only change their consumption. The big shift depends on us, the politicians.

Still, we have not managed to add any serious grid capacity that would bring solar energy from southern Europe to the north and send wind energy in the opposite direction. We have done nothing to truly harvest offshore wind and wave energy. We have simply been politically lazy in the face of a realizing daunting risk.

Here in Europe, there are not even any political limitations to such grid-building, because we wouldn’t have to bind ourselves to investments with regimes we do not trust. We are at home, and we can decide for ourselves.

The economist Jeffrey Sachs has stressed that we should spend at least 1% of our global GDP on climate change. This means that in Europe alone, we should set aside an entire EU budget for tackling energy issues and should run it centrally to provide each and every citizen with clean and affordable energy. Switching to clean energy is not a personal or a national effort, but an EU-wide endeavour! Imagine if we were to spend about 200 billion a year in Europe on developing green energy and long-distance connections!

This is perhaps the biggest initiative we could undertake unitedly, because we are the EU. No one else can make such a rapid decision. No other region in the world has mechanisms similar to the common spending schemes we have in place. No one else has the necessary legal environment like the common procurement procedures and competition legislation that we have. Only the EU can launch the global task of saving our planet.

Selling the solutions we discover while transitioning to green energy will guarantee economic success in the long term as well. If you’re looking for success stories from our very own EU clean-energy sector, then just look at what windmills did for the Danish economy.

Only if we manage to first save our planet can we gain the right to initiate meaningful discussions about the future of digital and AI technologies, the changes in society they will inevitably bring, and how we can use Europe’s advantages to manage that change in turn.

Because, as always, there are European advantages to managing cross-border developments. When we talk about technological development and science today, nothing happens within the borders of one nation state alone.

Nonetheless, and I really wish to stress this, there will be no point in fostering all this thought about technological change if our planet is too warm to support human life in general.

Thus, everything I talk about from here forward will have no purpose if we do not clear the ultimate hurdle of climate change. None. Still, let us hope, and let us continue.

We continually observe how digital technologies transform all aspects of society: labour, social structures, and tax systems. As we can already see, the systemic change is as great as industrialisation was in its own time.

Like industrialisation, digitalisation replaces above all the physical aspect of human labour, but leaves our cognitive capacities as a human monopoly. True, more and more, we do see machines learning human behaviour and reflexes. We see them used and even exploited: first by internet trolls, then troll-like text generators, etc. Machines are better than we are at understanding and trading on the stock exchanges. However, I predict that mankind will cease supporting systems that have grown elements we cannot understand and therefore do not trust. Compared with the 90s, fewer people are investing through the stock exchanges and prefer, for example, crowd finance platforms. Not because these individuals estimate a better risk-return trade-off, but because they understand what the platforms do.

I am confident the same will happen in the big marketplaces of opinion, i.e. in social media. Already, people are less trusting of what they see on Facebook, because they are learning the patterns that self-serving content tends to take. This might lead to a Facebook where people set up algorithms to represent themselves and then leave. The algorithms will continue to function, but peoples’ minds will be somewhere else.

By this, I mean to say that human beings’ cognitive capacity is still exclusively theirs, whereas their physical capabilities can more or less be left entirely to machines.

Even assuming that technology develops so fast that we ourselves will witness the singularity, compassion will still lie out of its reach.

Yes, machines can master the simplest of cognitive aspects, interpreting sad, happy, or angry expressions. But this alone is not enough to understand the complexity of human emotion. Even a genuinely singular computer will not feel or perceive humans correctly, because it will only process the brain and not the rest of the biochemistry we possess in addition to the mind. Much of the human being is nestled within emotions.

Therefore, we will not encounter increasing unemployment as machines take over our routine chores. Compassion, both displaying and disseminating it in society, will become our full-time job. On the one hand, this is because there will simply be more time for being a compassionate human being. On the other, because the majority of human interactions that was once necessary for performing even the simplest of services will be discarded.

Take online bank transactions, for instance; or self-checkouts or check-ins. How many different pairs of eyes did someone living in the beginning of this very century look into on a daily basis compared with what we experience now? The trend will continue up unto a point where our everyday lives no longer require direct human interaction.

The providing of human interaction will therefore become a prominent economic sector. Mind you, I don’t mean to say that people are lonelier today and will be even more so in the future because of the fact that everyday business is done without much human contact. I see this as something positive. In the early 2000s, the overwhelming majority our time was consumed by providing one another with various services: banking, sales, car washes, coffee shop and restaurant waiting, hotel check-ins, or planning our holidays abroad.

This is less and less the case. Even so, we can and will still spend our time on other people, interacting with one another. We are seeing a rising demand for all kinds of activities that simply make us happier or safer.

There are more and more people around the globe who make a living on caring for our minds, but also on keeping us happy, entertained, and in a good community where one can feel a sense of belonging. Bankers who have lost the boring menial function of money transfers are actively seeking to advise us on financial matters. Personal experiences can be sold online, either directly or through commercial advertising, making it a job in and of itself.

Take schools, for example. Here, 42 Paris is piloting a future school model: supported machine learning in which educational content resembles an electronic game. The teachers do not teach, but rather support learning. Their job has not lost relevance, far from it: they provide students with networks and networking skills, but above all, they teach how to be a compassionate human being. 42 in Paris or Lyon is a warm and supportive environment where one comes to be with other people: classmates, mentors, and teachers alike.

I predict we will have something similar in all school types within 10-15 years. Machines are much better at conveying the technical knowledge we still need to have. They test students and provide them with new tasks based on the results. Children’s actual knowledge of our world will depend decreasingly on age, as it has been for every past generation. Instead, it will stem from their age together with their interests, because a vast amount of knowledge is available online and kids are using it to learn. The fact that their knowledge is something other than what we find in textbooks does not make it less informative. We need to fill in the gaps and connect the dots in their brains, which have been packed with fragmented information.

However, we cannot teach them in the same universal way we have to date. The variations in their knowledge will be far greater in the future. Thus, teaching must turn into supported learning.

The change in children’s ability to master foreign languages is a good introduction to what is to come. Girls have traditionally performed better on school language tests. This no longer holds true overall. Recently, boys have been scoring better in English. The reason for this is that they play computer games more actively, resulting in rather highly-developed language skills at an early age. The children in my own nine-year-old son’s class all have quite a good command of English. In no way does their proficiency match the expectations of the school’s curriculum, which foresees beginners having a vocabulary of 500 words and very basic grammar. Instead, they are able to use words like leprechaun, and to pronounce them even better than their teachers.

Alas, none of the students can actually write leprechaun or, for that matter, many other words that are easier to transcribe, because their skills are primarily oral. They require special tutoring in order to identify and be conscious of rude words, offensive phrases and vocabulary, and expressions that have dual meanings. In short, they know a great deal of linguistic mechanics, but lack basic cognitive sense of the language they can technically speak already. They persistently make cultural errors in English while semi-fluently speaking the language due to the technical nature of their proficiency.

So, we must teach them differently. We should show them how language can be used as an element of human interaction without offending anyone or missing the point they’re trying to make. You see, we must no longer teach them a language, but rather teach them how to use language in interpersonal relationships; to remain within the acceptable limits of assertiveness without trespassing on the rights of others. We must teach them how to be responsible, empathic human beings.

Now, we’re right back to where I started: the tech part of this speech. Society will one day be relieved of menial, boring, and technical tasks. However, people will require special training in how to be an empathic person: a skill at which we can excel, and which cannot be replaced by any technological learning tool. Our cognitive traits are safe from competition from machines. The teaching and learning of cognition will soon be a big part of education. Being empathic will be a job.

Why do I think Europe is best positioned to tackle our future? First and foremost, compared with other wealthy regions around the globe, Europe has specialized most in human empathy. It was built upon it. The European Union was created to avoid war and the atrocities that accompany conflict. As a result, the EU’s tasks have never been purely economical, nor have they been linked to technological development aimed at increasing added value or productivity. It has been built to provide, first and foremost, national security to the entire EU and its neighbouring countries, which have used this security in turn to foster individual peace of mind and safety for their citizens.

Hence, we as a European society understand compassion. We have long rejected the notion that if you haven’t purchased an expensive healthcare package, then you will be left to die if you should contract a costly disease. We have, perhaps, even trained ourselves to forgo as societies the ultimate human achievements in healthcare in order to make it widely available to all, notwithstanding one’s social status.

We have not quite managed to provide for egalitarian school systems: only a select few nations, such as the Nordics and my own country, have met the challenge. Others are still striving to make schools and education more egalitarian. Without such efforts, social mobility – a right that all citizens should enjoy – is extremely difficult to achieve.

We see our middle classes rising up against the lack of empathy in society. True, they are not starving and have a wide network of social services to provide for their basic wellbeing. However, they still feel discontented because they have not been listened to, valued enough, or received mention in politicians’ speeches. Europeans do not accept being regarded as obsolete; they do not put up with feeling like they don’t matter or are being shown too little sympathy. They put on yellow vests and make themselves visible. Or they vote for Brexit. Or, in parts of Eastern Europe, and perhaps even in Estonia after our upcoming March elections, they vote for extreme nationalists with an almost communist zeal for controlling every aspect of peoples’ lives.

You see, in Europe, our citizens demand that we deliver more empathy. Empathy, not new gadgets. That is what people want.

New gadgets have helped to make life easier and will continue to do so.

Today, at home, people have domestic aids that would have been equivalent to dozens of servants in the early 20th century. Yet, they are still unhappy, and they want something else. Not something more, but something else.

There has been a contraction of human interaction. People feel like society is falling apart and there is insufficient mobility between social classes. They do not dream of 5G, I am sorry to say. They dream of happiness and hope.

So, what can we do? What do we need to change?

I explained the transitions that our schools need to make. They must teach our children to be compassionate.

Our jobs are already changing as well, leading us towards sectors that handle peoples’ minds and mindsets.

Let’s take a quick look at our capacity to start providing the empathy we’re currently unable to deliver. What are our own European social security networks doing?

First of all, they’re losing taxpayers. How?

Our social systems are based on an industrial economy. It is crucial that this changes, because we will be unable to offer our children an egalitarian society, one that always provides hope, while using an outdated format. It will become less and less sustainable, as more affluent workers will opt out when our European social model requires a type of lifestyle they are not living: one with a stable job contract, steady contributions, and a fixed address and country. Digital nomads will switch to private insurance policies, putting a gradual end to solidarity-based models.

Everyone else will end up less and less a part of a society that is rich in tech and wealth in general. We have to act quickly to avoid this trap, which can choke out social mobility and drive our citizens to protest in the streets against our inability to offer them the opportunities they formerly enjoyed.

Still, we must do this without limiting the global benefits of technological development. Technology is globalising the job market, allowing us to work when and where it suits us while not necessarily relocating physically. People often claim that the digital world is taking jobs away, and that we should be scared. Quite the contrary. Digital technology has made the job market more equal, more accessible. And you know what else? It’s made it much bigger, as you don’t necessarily have to work in your own country.

Knowing the Estonian tax code and working from somewhere in Africa is entirely feasible. If you are, for example, an African woman eager to learn accounting online, then be our guest! Estonia naturally doesn’t stipulate that underlying documentation necessarily be based in the country where the bookkeeping is done. Everything is electronic anyway, so you can manage it from Africa if you so please.

I believe many of our problems could be solved if everyone in the developed world collectively adopted the standpoint that technology and its active utilisation needs to be enabled, supported, and nurtured; not ignored or even restricted.

I know that unfortunately, we have not. This is worrisome, and I’ll tell you why. I call this the ‘Alice in Wonderland issue’, which means... You are all familiar with Alice in Wonderland, right?

There was a cat, the Cheshire Cat. When he vanished, his grin didn’t disappear with him, but lingered on. We see that our job market is changing. Industrial jobs are vanishing. Do you reckon our social model of collecting taxes and distributing the revenue according to where people live and where they work, assuming the two are in a single place, will still remain? It will certainly linger for a while, just like the Cheshire Cat’s grin. However, we know the grin ultimately faded. We don’t yet realize that more and more people are working independently: we see the numbers rising left and right, but we are not adapting. We still expect people to have a work address and one company, maybe two, at which they are employed. Or, maybe they are self-employed and living in in the country to which they’re registered. Then, we tax them and provide services.

This is not the way to go. Our citizens travel and services must be provided on a global level. For example, a citizen must be able to vote wherever he or she finds themselves during an election. We need to develop schools where people can educate their children in their native language even if they are very far from home.

Logic states that we should develop a new kind of contract which allows people to pay taxes to the country to which they feel closest, reside in, or are citizens of, and that this country will then offer the person its services globally.

Estonians try not to just sit on their hands and complain. During our EU Council presidency, we convened officials from all EU ministries of finance in Tallinn to discuss a possible global proposal that would solve the issue of dwindling industrial jobs within an industrial-based social system.

If we are not quick to adapt, then more and more people will choose to opt out of our social models every day. They may opt back in when they need healthcare or education for their children, but by that time, we’ve lost a big proportion of their earnings. Only the pension system really penalizes a late opt-in; with everything else, there is practically no loss for the individual.

However, we do not want to lose our European welfare states.

We appreciate them, and we wish to keep them.

Welfare states could help make the shift to a digital society smoother than was the transition from an agrarian to an industrial society. Back then, the process was extremely painful for many people.

This transition is just as momentous.

Estonia is often called a digital frontrunner. It is, in fact, more a societal than a tech leader. It is the only country that has brought business and government together to implement technologies which can, and are, benefitting society as a whole.

Estonia’s e-government is like an app store on which anyone can develop services: private companies, the public sector, person to person. Even you can! If you become an Estonian e-resident, you gain access to this app store and can use it to develop your business. It’ll naturally be an EU business, so there are actually a lot of creative things you can do.

Estonia as a society is, of course, not an app store. It is a European country through and through, passionate about its social security net and also compassionate towards its people.

To ensure that all Estonians learn about and participate in the great digital transition, we opened an e-governance platform for businesses. Not only because we think it’s good when government and business work together: we needed it so that people could have a wide range of e-services both public and private at their disposal, and so they would get used to using them.

Our worry was that if we didn’t allow the private sector to utilise the same backbone of digital services, then people might only declare their taxes online using their digital IDs, and that would not be enough. They wouldn’t get accustomed to using a digital ID on a regular basis. Therefore, we greatly supported the private sector operating on the same platform.

We can now emphatically state that society as a whole can only benefit from digital technology if the government supports its utilisation and establishes corresponding legislation if necessary. In addition, one essential part of this is having the most critical attribute of the digital world – identification – being provided by the entity that has the means and the rights to guarantee legitimacy for all parties. This entity, just like in the analogue world, is the government.

Governments must stop shirking their primary duties as soon as any new technological development makes them uncomfortable. This is a lesson we have learned in Estonia. It applies to the digital world, and will apply to AI and all future technological developments.

This lesson is much more valuable than any other we have taken while transforming into a digital nation: for tech use to benefit everyone, it must have the government as a sponsor. Not as a payer, but as a supporter of development. Too often, we tend to confuse the two in Europe: the responsibility to develop and the responsibility to provide creative space. We must not make this mistake.

Do we possess something that could make digital disruption, both ours and the ones yet to come, easier for people? Yes: our social and educational systems, if, as I have suggested, we transform them quickly enough.

However, this will only work successfully if we cease any talk about levying taxes on digitally-provided services, and also stop trying to keep outdated jobs alive even if they are dying a natural death. If we had taxed tractors, then people would still be doing agricultural work manually. We didn’t, but neither did we offer people support when they relocated to industrial areas. Most of our ancestors’ lives were quite rotten in those years, and conditions only improved gradually together with the rise of industrial productivity.

We need to guarantee our citizens can manage this new societal change, and for that, we need tax revenue.

There should be more options for contributing to the state, and doing so should be much, much more flexible in the future.

However, we will need an international agreement.

It is extremely important that we understand these new jobs are not made solely for software engineers. Yes, they do create the carrier services, but the content services are much more democratic. Think about it: what has been the main source of income for big tech companies, if not carrier services or hardware? Talking. Short communication – Twitter. Longer discussions – Facebook. I mean, what is hi-tech about these? Nothing. It’s not something for which you need a PhD. For instance, you can make money as a travelling YouTuber. Or consider someone with a disability: an autistic person who loves knitting red socks and lives in a rural area in any country around the world. Ten years ago, he couldn’t have made a living off his favourite pastime, because there were not enough customers for red socks in the area. On top of that, let’s say he is extremely shy and has difficulty making sales. Today, these problems have all been solved. He can make a self-employed living selling his socks online on the global market, without moving, and with no anxiety of human interaction!

We must not think that tech is dangerous, that it is taking away jobs, or that it is only creating jobs for the educated and well-to-do. It doesn’t need to be like that if you make it inclusive. We have made the digital inclusive in Estonia, and I am confident that other countries can do so, too.

If we can accomplish this in Europe, we will be world champions in wealth generation and welfare provision, just as we are accustomed to being. If we stall or we react too late, we will lose our chance and will witness a digital division in society that is akin to and further amplifies the divisions between rich and poor.

Our European Union enjoys an environment where citizens operate naturally across borders in analogue life. We already have the free movement of people and an abundance of cross-border freedoms, but they are cumbersome in the analogue world and do not at all apply to the digital world I have described. Once again, and more so than any other region in the world, we here in the European Union have a competitive advantage. From this starting point, adapting it to technology-based working nomads can only be easy.

I also believe this is our obligation. Having legalised and promoted the free movement of people, we must at the same time keep them engaged as citizens of their country of origin, participating in the state’s cultural, educational, and democratic space. Online schools, online voting, online social services, and gapless global medical coverage for our citizens, wherever they may be, are all a part of this new world.

However, in order to provide such services, we must first create a tax model that will foster this new world. We can still tax consumption and property in our own countries, and I believe we should continue doing so. However, salary-related taxes are not easily collected from people who work intermittently, for several companies at a time, independently, and sometime in many countries at once through the internet. Some kind of a new agreement is necessary. I like to call it a ‘safe dock’ contract: one made between the government and its citizens to pay taxes in exchange for global support. Again, Europe can be a pioneer on this front, because Europeans are already accustomed to the opportunity to work freely in 28 different countries. We have the need and we have the tools like no one else in the world. It is another chance to utilise the EU’s competitive advantage for a better future, if you please.

You see? Our predecessors created the EU, which has not only helped to avoid wars in Europe; which has not only stepped up to create a giant common market to foster economic development on our continent. They also prepared us for the future: we, as the EU, have numerous advantages at our disposal that set us up to successfully ready our societies for technological changes.

The founders of the European Union created a Europe that can save the planet. I return to this point again and again: devising new systems of taxation, education, and e-governance is pointless unless we save the planet first.

Europe has always had obligations vis-à-vis the entire world and has acknowledged it. We have to boost our ambitions. There is an opportunity to stop climate change if it can be impacted in any way by halting the rise of CO2 emission levels. We are not entirely sure it can be stopped, but we need to try.

We must act quickly and radically for our planet to be saved, because Europe is the only continent that is wealthy enough, coherent enough, connected enough, and regulated enough to meet the challenge.

We simply need to decide. Decision-making can be a painful process in the EU, but again, our union typically manages in the face of any urgency. And there is urgency here, believe me.

Thank you for your patience and attention! Thank you to the heads of the university for allowing me this wonderful opportunity to present to you my impatience and my impression that to some extent, we are wasting the advantages that our union provides.

Please do better than our generation of leaders! And please support those of our generation who want to do better: resist the simple solutions that are proposed and demand ones that will last enduringly; forever! Our fate lies in your hands and we are in your service.

This speech was originally delivered in French.