I got sent an article during the weekend which made me reflect a little on AI and its effect on the world. The article, a mix of evangelism and dystopia, went on a diatribe about how AI would eventually automate everything. Every industry disrupted, every enterprise altered forever—an interesting scenario which doesn’t really seem to fit the reality of what we are experiencing nowadays.

Alarmist tones sound as reasonable as The Animatrix in the 90s, which is, to me, almost a complete work of fiction. What many professionals don’t happen to grasp is a bit darker, though, and it seems to be that we are heading into a global economic crisis which will take effect on a global scale.

Don’t get me wrong, AI is definitely evolving how we tackle a lot of intellectual work; however, at this point, in an increasingly aggressive economic market, it’s mostly a race to the bottom. The extreme productivity that tech evangelists claim has been unleashed is not really much of a factor if no one can buy the services offered.

On a global scale, it would be arguable that the bulk of service consumption until recently fell onto the middle class. As millennials were growing up, a healthy middle class was in a strong position to buy all sorts of assets and vehicles and, in general, power up the consumption market and the elements that represented this class: two cars and a house in a suburban landscape.

As the middle class reduces in size and productivity increases, commodization of services will, for a very short period, disguise the harsher economic reality that caused the instability in the first place. With AI, prices have reached the floor, but it has not been profitable for the vast majority, at least not for a while.

While it’s defensible that we are under accelerated pressure pushed by AI, the real issue is an economic one. Previous revolutions led to labor displacement into lateral industries or, in general, new niches. AI, however, has unilaterally lowered the price of goods and services, yet living costs are mostly unaffected, and the trend is independent of this phenomenon.

The baseline knowledge of AI cannot be higher than the sum of the knowledge that created the LLM, which means the potential combinations we can obtain from the system are, by nature, finite. We have plenty of non-digitized content, and AI does not generate new observable research (it is still validated by experts, so the great professional replacement is unlikely).

So while we are focused trying to push responsibility for massive layoffs on top of the new applications of this tech, in reality we are seeing the results of a structure where extreme wealth concentration has reached a peak.

The sort of instability this will come to bear no one can predict, a world in conflict is inherently more unstable and in the past, war engines have been utilized to correct and redistribute wealth (or to distract the populace).

China’s property market constantly threatening to go bust, Russia’s political instability, and the USA’s impending depression signal multiple collapses at the same time; and while the future is not something anyone can guess, I would dare to say:

The coming crisis is not really AI’s fault….

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