More people take to the streets on the 1st of May in Germany. The costs-of-living crisis with high inflation has increased the claims for pay rises for workers and adjusted wages for employees. We all have observed “greedflation”, i.e. excessive company profits in several sectors. Additionally, “shrinkflation” has affected consumers in their daily shopping experience. Political efforts to curb inflation have taken a long time to come about and most initiatives have ended already (Energy sector). This spurred a new drive for trade unions to come out in huge numbers to protest and claim adequate wage increases to cover the increased costs of living. In Germany the DGB informed on the annual 1st of May demonstrations across the country about a strong new entry movement of members of 400.000 persons. It is higher than the loss of members of the large baby boomer cohorts who retire.
Through a broad and engaged membership the pressure on higher wage settlements will persist. Companies have used the crises to generate extra profits. It is only fair that those employees who largely contribute to the success of a company will claim their share as well.
For society as a whole it is important to consider that the discrepancy between managerial pay and shop floor wages do not increase further. The social fabric of societies is in danger if perceived injustices grow. More radical forces can all to easily exploit this causing a severe danger for democracies. Meeting people on the 1st of May and joining forces across sectors and trades ensures that a society continues to build and rely on solidarity. High inflation times are a great reminder of the economic basics of societies in history as well as today. 
Find Trust
Societies have different levels of trust. Trust in politicians or political institutions has been researched a lot. Another example of trust is related to things lost and found. Losing an item on a train or a mobile phone somewhere are severe tests of the level of trust in a society. How likely is it that the item is going to be found and returned to you. We usually estimate the probability of the return of items as being rather low. The more we are surprised to find out that there are thousands of items found and returned. The Deutsche Bahn has a special service in operation to take care of lost items. Additionally, there are auctions of items found but nobody claimed the ownership of it in the following months. Not giving up on a lost item is the first step to find it again. It would be a nice test whether in high trust societies it is more likely to find something lost. If you have a higher trust that items will be returned you are also more likely to make the effort to claim the item back.
Comparative Advantage
In economics all students go through the calculus of comparative advantage. People, regions or whole countries tend to apply comparative advantage to their production systems and ensuing internal or external trade. The basic rationale developed by David Ricardo has not changed that much over 200 years. The fields of application, however, are continuously expanded. Lindsay and Gartzke (2020) have applied the comparative advantage rationale to military strategy. The paper quotes 26 times Clausewitz and demonstrates the links of strategy to the basic economic and social rationale of comparative advantage. It is the politics of production that even the presence of trade may override the rationale of comparative advantage to favour local production of “operational domains” or military equipment.
In Russia’s aggression and war against Ukraine own production and trading of weapons has returned to the forefront of the concerns. In addition to the production of ammunition, the provision of drones has dominated the international arms trade related to the Russian aggression. Resources and time for production are additional factors that have an impact on availability of weapons at the right time at the right place and with the sufficiently trained persons to operate them.
The strategies that cross domains or combine domains seem the most promising. The careful analysis of your own comparative advantages or disadvantages needs to be the basis of any strategic decisions. This has been known for 2 centuries at least and is still valid in many fields of application. Additional considerations for “home production” might add to the complexity of the issue. Sustainability has also found its way into the field of comparative advantage at last. This may alter the analysis of comparative advantage of operational domains as well. Lots of unresolved puzzles still around. It will need years to sort this out despite the urgency of the Russian aggression on Ukraine.(Image: AI Copilot.2024-4-30 2 political leaders deal weapons. One has a comparative advantage in ships. The other one has a comparative advantage in aircrafts. they deal together)
AI Disruption
Many scientists started to question the disruptive potential of AI in, for example, the military’s domain. The Journal of Strategic Studies featured 3 papers on AI and autonomous systems more generally. The major argument by Anthony King is the reliance of autonomous systems on other systems mainly human operators even in the background to get these systems off the ground and maybe back again. Not only logistic support but also satellite communication is needed to guide and protect the operations. In quoting Clausewitz, Anthony King stated that war is a “collision of two living forces”. Strategy and counter-strategy will co-evolve as will attack and defence.
Jackie G. Schneider and Julia Macdonald (2024) advocate the use of autonomous and unmanned systems for their cost effectiveness. Economic costs as well as political costs are lower for these new strategic weapons. Mass fire power from swarms of drones is much cheaper than nuclear warheads and the home electorate is assumed to be more willing to accept and support limited and more precisely targeted unmanned missions. The disruption potential of AI is huge but it is most likely an addition to the arsenals than replacing them. (Image 2 swarms of drones fly in the air above tanks, created by AI – copilot-designer 2024-4-29).
Hospital Bias
Asking people about differences between private and public hospitals, you are most likely getting answers that the private hospitals deliver superior patient outcomes. Whereas private hospitals seem to have a positive stigma attached to them, public hospitals commonly have a negative stigma. Scientific evaluations are helpful to set the record straight again. The study published in “The Lancet Regional Health” in 2024 shows that in the simple descriptive statistics on several patient outcome indicators, this is what the data showed between 2026 and 2019. However, a more precise statistical analysis reveals that there is also a selective admission to the private and public hospitals in England. Using so-called instrumental variables approaches that account for the selection process between admission to the 2 types of hospitals (private versus public) most of the differences between the hospital types disappear. The underlying mechanism is a sorting of different patients into the private or public hospitals. Put in easy words, for a routine intervention people tend to chose the private hospital, but the more rare and difficult operations were more likely admitted to public hospitals. The number of co-morbidities (heart disease) is also of importance as they might negatively affect patient outcomes. Jumping to conclusions and reinforcing stigma about public or private provision of services hinders progress and an equitable provision of services.
The analysis of a potential selection bias can reveal the “creaming” effect of private provision of (health) services. Just caring for the “easy” or routine cases and avoiding the more difficult and costly cases has economic advantages, but for society as a whole the costs overall remain the same. A good public service in health is a definite asset.
(Image: Exposition Isa Genzken 2023 in Neue Nationalgalerie Berlin)
Hannover Fair
The annual science fair at Hannover is a kind of a show of things to touch and of those things that come to the public market in the near future. Most of the annual hype is about potentials of production. Rationalization, using few resources or innovative solutions of digitization are high on the agenda. Create your digital twin, save energy, make production more safe or cyber secured.
Robotics is another reason to visit the fair. Some 7 years ago I had my Sputnik experience there. The robotics company KUKA had demonstrated live the that assembling a car from pre-manufactured components takes just 10 minutes for the robots. Shortly afterwards the whole company was bought by Chinese investors. Roughly 5 years later we are swamped by cars from China. It was not that difficult to predict this at that time. Okay, we need to focus on more value added production and take our workforces (not only) in Europe along on the way. Reclaiming well-paid, unionized jobs in manufacturing, as Joe Biden does, will not be an easy task. Robots and their programming is expensive, but skilled workers, too. Hence, the solution is likely to be robot-assisted manufacturing as a kind of hybrid solution for cost-effective production systems.
Following the proceedings of the 2024 fair we are astonished to realize that visiting the fair is still a rather “physical exercise” walking through the halls. After the Covid-19 shock we expected a lot more “online content”. Instead we keep referring to webpages and newletters rather than virtual visits and tours. The preparation of the visit in advance remains a laborious adventure. However, the in-person networking activities in the industry are largely advanced by ease of exchanging virtual business cards and the “FEMWORX” activities.
This year’s Sputnik moment at Hannover is probably most likely related to the pervasive applications of AI across all areas of the industry and along the whole supply chain. Repairing and recycling have become mainstream activities (www.festo.com). Robotics for learning purposes can also be found to get you started with automating boring household tasks (www.igus.eu).
Visiting Hannover in person still involves lengthy road travel or expensive public transport (DB with ICE). Autonomous driving and ride sharing solutions might be a worthwhile topic for next year’s fair. Last year I thought we would meet in the “metaverse fair” rather than in Hannover 2024. Be prepared for another Sputnik moment next year, maybe.
(Image: Consumer’s Rest by Stiletto, Frank Schreiner, 1983) 
Digital Estonia
The progress of Estonia in going digital is quite advanced. The electronic identity card which allows data to be linked to health data and accounts or banking gives an impression of how far-reaching digitalization may go. Great steps have been taken to guide the population on the way to move towards the digital (only) world. Learning and coaching of a huge amount need to take place so that people do not abandon or get lost on the path towards “everything digital”. For the so-called digital natives, who have grown up with the sound of their smartphone at the bedside all the time, this move feels “natural”. Some experienced or silver workers got on track, if they were accompanied in suitable forms. The 65+ population might find it harder to adapt to the permanent use of digital devices for not only getting around in your city, but also to do your tax declaration, pay your dues and vote in elections.
Digitalization is not a goal in itself. It has advantages to reach communities in remote places or islands, but it might alienate older persons that have no other person around to assist them in the digital only world. An easy way to get some social science data to inform the debate is to refer to Eurostat and the surveys with information about the “overall life satisfaction” of people (EU-SILC). Checking for some major countries of the EU and neighbours of Estonia with less digitalization the differences are rather small. In terms of overall life satisfaction (16+ years old) Estonia has been catching up to the EU-average mainly between 2013 and 2021. Since then, stagnation at the EU-average is what the data tell. A quick testing of the hypothesis that the older persons (65+) might not see the past evolution as rosy is reflected in the EU-data as well. Good pensions seem to drive the “happiness” of older persons in the EU more than good digitalization. Eventually the two features of a society will have to go hand in hand to improve life satisfaction to higher levels. (Image: Data Eurostat EU-SILC Life satisfaction 65+, selected countries 2013-2023, retrieved on 2024-4-23, comparison with table all ages here, Data source)
AI Travel
Playing around with AI it is nice to test take fun examples. Image you want to plan a vacation, then the use of AI is ready to suggest to you a couple of things to do. Of course, AI is eager to propose travelling services like transport or accommodation to you where it is likely to earn some commissions. So far, the use of the “Vacation Planer of Microsoft’s BING Copilot” is free of charge. In entering the time period and a region as well as some basic activities you’ll receive suggestions with quotes on the sources (webpages of public services from tourist offices mostly). It seems like trustworthy sources and the suggestions of D-Day activities in Normandy is a positive surprise to me. These are popular activities which attract huge international crowds every year.
Thinking further on the potentials it becomes evident that travel suggestions will be biased to those paying for ranking higher on the algorithms selection criteria, which are not disclosed. Entering into the chat with the AI you and AI can target more precisely locations and also hotels etc. You are disclosing more of your own preferences in the easy-going chat and probably next time you will be surprised to be recommended the same activities at another location again.
So far, I have bought travel guides or literature about locations to prepare vacations. This is likely to change. I complement my traditional search or planning with the “surprises” from AI for travelling. I rediscovered, for example, the public service of tourist offices and their publications ahead of the travel rather than the leaflets at the local tourist office. In order to plan ahead there is value in the augmented search and compilation capacities of AI. Drafting a letter in foreign languages is also no problem for AI. The evaluation of the usefulness of AI, however, can only be answered after the vacation. Outdated info or databases have a huge potential to spoil the fun parts as well. 
Repair Building
All buildings need repairs from time to time. For most of them the basic structure is solid enough so that isolation or maintenance will do. However, 100 years old buildings that have lived through 2 wars might have deep rooted deficiencies that are not visible at first glance. This can be observed in Berlin near the city center in a popular neighborhood with many visitors in „Schöneberg“ sometimes translated as „pretty hill“. The building at the crossroads seems to have been renovated only a few years ago, but the static of the building is so unstable that the city council has decided to block the whole crossing for circulation due to the danger of an imminent collapse of the building. The neighborhood has mixed feelings. It is great that the danger has been identified in time and blocking the road reduces the nuisance of traffic in the surroundings full of restaurants and cafes. The cover up of the repairs and renovation at the building is shocking as there appears to be just paint over basic structural faults. Construction work has failed to detect and prevent the static risks. An inspectorate that acts promptly to avoid bigger disasters is a societal asset.
AI and PS
AI like in ChatGPT is guided by so-called prompts. After the entry of “what is AI” the machine returns a definition of itself. If you continue the chat with ChatGPT and enter: “Is it useful for public services” (PS), you receive an opinion of AI on its own usefulness (of course positive) and some examples in which AI in the public services have a good potential to improve the state of affairs. 
The AI ChatGPT is advocating AI for the PS for mainly 4 reasons: (1) efficiency purposes; (2) personalisation of services; (3) citizen engagement; (4) citizen satisfaction. (See image below). The perspective of employees of the public services is not really part of the answer by ChatGPT. This is a more ambiguous part of the answer and would probably need more space and additional explicit prompts to solicit an explicit answer on the issue. With all the know issues of concern of AI like gender bias or biased data as input, the introduction of AI in public services has to be accompanied by a thorough monitoring process. The legal limits to applications of AI are more severe in public services as the production of official documents is subject to additional security concerns.
This does certainly not preclude the use of AI in PS, but it requires more ample and rigorous testing of AI-applications in the PS. Such testing frameworks are still in development even in informatics as the sources of bias a manifold and sometimes tricky to detect even for experts in the field. Prior training with specific data sets (for example of thousands of possible prompts) has to be performed or sets of images for testing adapted to avoid bias. The task is big, but step by step building and testing promise useful results. It remains a challenge to find the right balance between the risks and the potentials of AI in PS.