The philosophers have only interpreted the world, in various ways; the point, however, is to change it.
Karl Marx, 1845

Here the comparison is made to economics, where you start with the individual and try to build a theory from there. Sociology does the opposite, starting with “society” as the unit of analysis, which gives the researcher the freedom to basically argue whatever he wants. Over time, dynamics within fields become self-reinforcing, with the people interested in understanding the world and doing the hard work required involving quantitative analysis going into economics, and those who want the prestige of being an academic while doing political activism becoming sociologists.
Richard Hanania, 31/8/26

I’ve never studied sociology formally. But I’ve been an armchair sociologist all my life, chiefly because I believe that it’s useful to understand how different social structures shape individual behaviour, opportunities and beliefs.

I suspect even a rugged individualist on the Right would concede that it’s sometimes useful to start with society rather than the individual as the unit of analysis. They certainly don’t have any hesitation in drawing distinctions between what they regard as shithole societies and ones they find more impressive.

In its contemporary, highly politicised form, sociology has degenerated into a simplistic goodies-and-baddies ‘society is to blame’ discipline, but that doesn’t mean that social structures don’t have a profound impact on how people think, behave and vote. Nor does the dross pumped out by many modern-day sociologists negate the important contributions of past sociologists and sociology-adjacent thinkers, or the good work being done by contemporary, heterodox ones.

While you’re probably not entirely aware of it, dear reader, you probably deploy terms and concepts developed by sociologists, or de facto sociologists, on a daily basis: class (Marx), anomie (Durkheim), cultural capital (Bourdieu), the Panopticon (Foucault), liquid modernity (Bauman), intersectionality (Kimberlé Crenshaw), the Protestant work ethic (Weber) and the managerial society (Burnham).

Sociology is necessary to understand how societies and the individuals within those societies function. If you’re in an era when many – from Left to Right – believe the existing social structures have ceased to function appropriately, the systematic study of how society, social relationships, institutions and cultural forces shape human behaviour, beliefs and opportunities is more important than ever.

Why has sociology become so politicised?
In a post that’s now gone viral, Substacker Lionel Page (a behavioural economist at the University of Queensland) addressed the topic of Why has sociology become so politicised?

The tl;dr?

Page points out sociology’s longstanding blind spot – because it takes societies as the unit of analysis, it struggles to account for how individual agency interacts with collective behaviour.

Page contrasts sociology with economics. Whatever its other flaws as a discipline, economics at least attempts to engage in reality testing and has developed formal models, game theory and sophisticated causal methods.

But ‘social facts’ are rather less quantifiable than market transactions. This allows sociologists greater discretion over concepts, evidence, statistical analysis and interpretation than that granted to their economist peers. Page argues that this creates more opportunities for confirmation bias and “researcher degrees of freedom”.

As academia as a whole moved sharply to the cultural left in recent decades, these weaker epistemic constraints became particularly consequential for disciplines such as sociology.

With conservative scholars increasingly rare, Page contends, sociology became ideologically homogeneous and increasingly rewarded researchers for activist commitments and politically desirable conclusions.

Goodies and baddies
What conclusions are considered “politically desirable”? The same ones considered desirable in disciplines such as gender studies, ethnic studies, anthropology, education, history, communications, psychology and, yes, even law and economics nowadays.

In short, society is divided into two groups – oppressor and oppressed.

Much like Medieval Christendom distinguished between the faithful and heretics, Soviet Russia distinguished between the impoverished peasants and property-owning kulaks, apartheid-era South Africa distinguished between whites and non-whites, Maoist China distinguished between true revolutionaries and capitalist roaders, and Nazi Germany distinguished between Aryans and Jews.

The upside of such categories is that there is a clear distinction between the damned and the Elect. Even better, if you’re part of the Elect, you get to feel morally superior to the damned.

The downside of the goodie-baddie framework for understanding the world should be obvious, but I’ll bust out the obligatory Solzhenitsyn quote nonetheless:

The line separating good and evil passes not through states, nor between classes, nor between political parties either—but right through every human heart.

The oppressor-oppressed categorisation reduces complex relationships to a binary moral hierarchy: one group is cast as victim and another as perpetrator. It obscures differences within groups, individual agency, competing interests and situations where people simultaneously possess advantages and disadvantages.

It also encourages circular reasoning: disparities become evidence of oppression, while evidence contradicting the theory – for example, the educational and occupational success of some ethnic minorities in putatively ‘white supremacist’ nations – can be dismissed as another manifestation of oppression.

Most importantly, it shifts attention from understanding causal mechanisms to assigning moral responsibility, making it difficult to explain variation, unintended consequences and trade-offs.

Sociology needs more al-Gharbis and fewer Ardays
It’s been a grim few weeks for anyone who regards sociological research as a respectable intellectual pursuit. But let me end on a hopeful note by briefly relating the life journey of Musa al-Gharbi.

As he explains in a recent Substack post, al-Gharbi is an African-American Muslim from a military family whose childhood contained considerable hardship. His veteran mother was left with PTSD after being “a victim of sexual violence at the hands of her fellow soldiers”. His twin brother died serving in Afghanistan, and his stepbrother lost a foot while serving.

In short, al-Gharbi actually had the hardscrabble background that Arday had presented himself as having.

I was trained as a sociologist but was unable to get a job in that field. Arday was never trained in the discipline but was able to nonetheless secure professorships in sociology at multiple prestigious universities… Keenly recognizing the norms and incentive structures of higher ed institutions – much more clearly than I did at the time – he just made stuff up to get where he wanted.

After graduating with an MA in 2013, al-Gharbi struggled to land more than insecure, poorly paid adjunct instructor roles. After years of struggle, al-Gharbi resigned himself to a grim surplus elite future.

It seemed more likely that I was just a loser with no prospects, a drain on society, and a curse on the people and institutions who were foolish enough to throw their lot in with me. I didn’t seem to be the only one coming to this conclusion: my inability to support my family was straining my marriage, too. It was difficult to get out of bed each morning.

Then things started turning around for al-Gharbi.

In 2016, I was admitted into the sociology PhD program at Columbia University with a solid package to support us in New York.

I can definitely spin a meritocratic story for how I ended up at an Ivy League school… But it was not lost on me then or now that race was another big factor in my appointment. In my PhD cohort of roughly a dozen, I was the only black person. It would be unacceptable for a school like Columbia and a department like sociology to form such a large cohort without any black students… Was I just a diversity choice? Likely not. But at the end of the day, I didn’t really care much why the committee selected me; I was just grateful to have been chosen.

Proving he’s a natural-born sociologist, more interested in examining society than campaigning to make it more equitable, al-Gharbi is capable of dispassionately examining his own tribe.

Arday is far from the only academic to make false or deeply misleading claims about their disability status, ancestry, class background or sexual orientation… Norms and policies intended to rectify historical and ongoing injustices have led to a commodification of victimhood. Institutional incentives drive many to seek out “totemic capital” through less-than-honest means.

But members of the Elect (p)roleplaying as oppressed minorities is just a symptom of sociology’s wider failure – by its own lights – according to al-Gharbi.

In my field, many other scholars likewise describe their work as oriented towards “social justice.” In practice, though, very little sociological research is geared towards solving concrete problems for actual people in specific contexts here and now... The work is irrelevant by design, written in obtuse language and locked behind paywalls. And as a result, most scholarly work is barely read and never cited, let alone utilized in the service of practical ends.

Let me skip to the happy ending. Like many other insightful African-American thinkers, al-Gharbi came to believe the oppressor-oppressed division was, at best, reductionist.

Far from hating my countrymen or my country, my public-facing work was always overtly rooted in my confidence that regular Americans can make good democratic decisions if equipped with solid information delivered in an approachable way.

Very much proving he wasn’t a diversity hire, in 2024 al-Gharbi published an influential book, We Have Never Been Woke: The Cultural Contradictions of a New Elite that explored a phenomenon that’s been increasingly roiling Anglosphere politics – those most worked up about inequality are almost always members of a class that has benefited enormously from the neoliberal transformation driving ever-greater wealth inequality.

That’s the kind of sociological research the world needs much more of.

So, can sociology be salvaged?
I’d like to believe it can.

The answer to bad sociology isn’t less sociology. It’s better sociology – sociology willing to turn its analytical tools on itself, examine its own institutional incentives and ideological blind spots, and describe society as it is rather than as its practitioners would like it to be.

Rather than attempting to improve societies – a risky enterprise – perhaps sociologists can return to their original mission of attempting to understand them first.

I believe that at this moment we are sleeping on a volcano.
Alexis de Tocqueville, 1848

While nostalgic cultural ‘markers’ feature prominently in the febrile rhetorics of grievance – think anti-feminism, anti ‘mainstream’ media, opposition to First Nations recognition, replacement of multiculturalism with a predominantly white “monoculture”, and the rejection of gender and sexual diversity – it is generally held that the core of outsider resentment, is rising economic inequality…

The populist charge is that a broad consensus around neo-liberal economics means that the major parties argue loudly but never fundamentally threaten the interests of an inner-urban professional and business minority.
Mark Kenny, The Klaxon, 27/8/26

Silicon Valley has completely lost what made it great. It was a place for weirdos, for people at the fringes, for people that really were idealistic. And it has become something that’s far from that now… all we have done is focused on making money in every single way that we can, hand over fist. And there’s nothing wrong with that. Except now it’s at a point where we need to do a better job of acknowledging it and trying to do a little bit better… Every time we don’t, and we’re given a chance to be better, and we’re not, the hatred builds, the animus builds.
Chamath Palihapitiya, All-In, 21/8/26

AI will either be the greatest equalizer ever invented, or the worst source of injustice. The challenge is monumental. Even under the best circumstances, the transition to this new AI era will be one of the most turbulent times in human history. How will we use this technology to make the world a fairer place and keep it from widening the divide between rich and poor? How will we protect the people who are most vulnerable to the harms caused by artificial intelligence, including those who lose their livelihoods and the sense that they are in control of their future? I believe that answering these questions and acting on the answers should be the world’s top priority… Without solutions, some groups will push for stopping AI development and deployment altogether.
Bill Gates, 26/8/26

In retrospect, I can see the two core themes of this Substack over the last half-decade have been, firstly, elite self-dealing and, more recently, AI peril. In a perfect storm, the two have now come together.

Après moi, le déluge
You don’t need Rain Man-like powers of pattern recognition to notice a cycle repeating throughout history.

Plato and Polybius observed that each governing form degenerates into its self-serving twin (i.e. aristocracy decays into oligarchy; democracy devolves into mob rule).

Machiavelli noted that republics decline as private interests displace public virtue.

Pareto’s circulation-of-elites model posits that elites die when they close off recruitment from below – the talented excluded become the counter-elite that overthrows them.

Mancur Olson argued stable societies accumulate distributional coalitions that lobby for redistribution rather than production, imposing diffuse costs for concentrated gains until the economy calcifies.

Jack Goldstone and Peter Turchin agree on a three-variable model of state breakdown:

1. Popular immiseration – real wages falling relative to output.

2. Elite overproduction – aspirants to elite position multiplying faster than positions available, so intra-elite competition turns zero-sum and cooperative norms collapse.

3. State fiscal distress – the state broke and unable to buy off either group.

All of the above is common knowledge, but what’s less well-understood is that elites frequently sign their own death warrants by failing to course correct while they still have an opportunity to.

Partly this is a collective action problem – members of the elite are incentivised to preserve their own privileges while hoping a critical mass of their peers will take one for the team and redistribute some of their wealth and power to the restive masses. But much of it is arrogance – ‘My peers and I are intellectually and morally superior to the commoners. There’s simply no way society could function without us.’

As unthinkable as it may be, it’s just possible that today’s economic and cultural elites – the plutocrats and their professional-managerial class enablers – are just the latest in a long line of complacent, doomed elites.

The AI peril
As I’ve pointed out once or twice in these digital pages, AI is going to vaporise a lot of jobs, starting with those done by white-collar workers. There’s plenty of debate about when that’s going to occur, with estimates ranging from a year to a decade, but even the techno-optimists concede there is going to be substantial labour market disruption.

If I haven’t yet convinced you of that, dear reader, you might want to consider Gates’ take:

Robots and AI combined can create a vicious cycle. After one company adopts them and uses the savings to lower its prices, its competitors will feel immense pressure to do the same. If existing companies don’t adopt them, then start-ups will. Many people will shift to other jobs, but the turmoil of losing work, getting retrained, and finding other work will be significant. Market forces will make adoption go faster and faster and, unless we intervene, there will be fewer good jobs available and the benefits will accrue to a small group.

In short, yes, this time it is different. Unlike previous technological tipping points, AI will not just increase returns to capital but also destabilise the occupational position of the university-educated and create enormous political pressure for governments to redistribute the gains.

A political stalemate
Let’s recap where we find ourselves.

The bottom 80 per cent or so of the population believe the top 20 per cent – Kenny’s inner-urban professional and business minority – has thrown them under the bus economically while sneering at them culturally.

The elites – albeit more the business minority than the imperilled inner-urban professionals – are keen to push forward with the great AI transformation.

For some mysterious reason, non-elites believe that the great AI transformation will result in even more wealth and power flowing to elites. Increasingly, non-elites are mobilising to prevent the great AI transformation that business elites are heavily invested in.

What to do?

A buy-off to facilitate buy-in
In a recent Prospect article, Ethan Zuckerman examined a possible solution to the AI impasse. One supported by the likes of Bernie Sanders, Donald Trump and Sam Altman – AI sovereign wealth funds.

Briefly, the case for AI sovereign wealth funds is that AI models are built on appropriated work – publicly funded research and the collective cultural output of millions of creators who were never asked and never paid. Therefore, the public getting a stake in AI companies is just compensation. Equity is the right instrument: it costs the Treasury nothing, requires no guess about which firm wins, and captures upside where gains are most concentrated while displacement costs are socialised. Norway and Alaska show the model works. But the levy must be struck now, while these companies still want political cover – you cannot tax a windfall retrospectively, and after the IPOs the leverage is gone.

But here’s the opposing view – a state holding hundreds of billions in AI shares acquires a strong disincentive to regulate them (Norway still licenses Arctic drilling, for instance). The asset may be hollow – the labs lose money, and Nvidia funds the customers who buy its chips, so the boom may be balance-sheet churn. Worse, the fund would concentrate public wealth in the sector it is meant to insure against; both collapse together. Worse still, the arithmetic fails anyway – US wages totalled nearly $12 trillion in 2024, dwarfing anything a fund could yield. And the US tech industry’s eagerness to hand over, say, a five per cent equity stake in AI companies suggests it’s purchasing cheap insurance against regulation, and perhaps a ban on Chinese rivals.

Zuckerman ends up on the side of the sovereign-fund sceptics and concludes:

It’s not clear any such fund would ever benefit Americans or compensate in an AI-ravaged economy. Maybe it is best understood as a way for AI companies to fend off regulation, maybe even as a bribe.

I fear Zuckerman and his fellow critics have a point about the downsides of AI sovereign wealth funds. But I remain convinced that unless elites and non-elites agree on a win-win settlement, a lose-lose one will become inevitable.

The deal is simple in principle – let AI companies become enormously rich, provided society captures enough of the resulting wealth to make ordinary citizens materially better off. In exchange, citizens accept rapid technological change rather than attempting to stop it.

Options exist, if the political will does.

A diversified citizens’ wealth fund, financed by taxing AI activity rather than owning AI companies, avoids the capture problem Zuckerman identifies. Compulsory licensing of training data – the collecting-society model that settled this for music a century ago – answers the appropriation claim far better than equity ever could. Neither is straightforward, but both are more plausible than anything else anyone has yet thought up.

In the short term – given the febrile state of Anglosphere politics, possibly the very short-term – the status quo will make the wealthy and powerful even more wealthy and powerful.

But over the longer term, they risk finding themselves abruptly stripped of all the wealth or power they’ve accumulated. And possibly more.

“Defunding police means defunding police. It does not mean budget tricks or funny math.”
AOC, 30/6/20

I have a local city councilman that has this saying, Woke One was crazy…

Especially during Covid, there was a huge opening of the Overton Window… I think that the doors were really open in trying to entertain any and every policy that was going to get us to a better place.

Of course, rhetoric in that time is not rhetoric that we would use today… I think that’s why so much of what we focus on is also making sure that we are providing for the majority of Americans, guaranteeing health care, raising wages, strengthening the right to a union.
AOC, 9/8/26

Hmmm. AOC ever-so-delicately Sister Souljahing her core constituency – university educated, overwhelmingly Caucasian, illiberally hyper-progressive, surplus elite types.

No real harm done by a decade-long cultural revolution that reduced the legacy media, academe and the scientific establishment to a laughing stock. The lockdowns were a strange time when we all went a bit overboard with the brainstorming sessions. I’ve put the Woke away and am now an economic populist focused on healthcare, wages and union rights. You certainly won’t hear anything about two-spirit gender fluidity during my upcoming presidential run!

There’s plenty more Sister Souljahing left to be done
Many a one-time Wokester would now like to discreetly crabwalk away from their social media posts and dinner-party dissertations from circa 2014-2024. Having already tidied up their digital footprint by removing preferred pronouns from their social media bios, some Leftists are now going a step further.

Albeit after many a ballot-box rejection of Woke policies – especially open borders and racial spoils systems – the more self-aware and/or ambitious progressives are now issuing foot-shuffling AOC-esque statements to the effect that, yes, Woke was crazy.

But I suspect heavily qualified statements of regret won’t be nearly enough.

The wages of Woke
Here’s the NYT’s token conservative columnist, Bret Stephens:

Good for A.O.C. for acknowledging mistakes. Now can we have some accountability for the vast damage that Woke 1.0 did, not to mention the damage that Woke 2.0 continues to do?

Wokeness, as it commonly came to be known at the start of this decade, wasn’t just an Orwellian linguistic fad or a tedious set of corporate training sessions in cultural sensitivity or wacky policy ideas about addressing racial and socioeconomic inequities. As it was experienced by those on the wrong end of it, it was a system of enforced ideological conformity, policed by social bullying and institutional coercion (or cravenness), which damaged and sometimes even ended reputations, careers and at least one man’s life.

Here’s centrist Coleman Hughes:

This tragedy was enabled by the psychological need among liberal elites for a black avatar of their guilt. Arday’s death should be a call for liberals and progressives to look inward. Not to expunge the supposed demon of white supremacy that lives inside their hearts, but to look at the nature of white guilt itself. Because, ultimately, white guilt is a virus which leads its victims to prioritize their own need for catharsis over the public’s need for truth.

And here’s Marxist Freddie DeBoer on his eponymous Substack:

Some progressive people, like Alexandria Ocasio-Cortez, are expressing measured regrets about their past embrace of the most extreme expressions of social justice insanity…

Meanwhile this tragic, absurd Jason Arday situation is thrusting the incredibly unhealthy culture of our university system into the public spotlight…

We never had the woke postmortem, in media or anywhere else; we never actually had the conversation about how a majority of people who work in media had a sudden and massive ideological transformation that most have now quietly walked back without admitting to doing so.

But the absurdities of the peak woke era were indeed many and were indeed corrosive. Some of them were just absurd; some were more actively destructive.

I suspect those disfavoured demographics targeted by the social justice warriors – not least that Great Satan of the progressive imagination, the straight white man – won’t soon forget the, ahem, ‘progressive overreach’ of recent times.

I certainly won’t. But I’m going to heroically resist the temptation to indulge in schadenfreude at the discomfiture of the sanctimonious, purse-lipped scolds and attempt to answer the logical question that arises from Woke having been officially declared dead.

By its one-time poster girl, no less.

What comes after Woke?
As was often noted in 2024, Trumpism was essentially anti-Wokeism (Kamala is for they/them, etc). A critical mass of Americans voted for Orange Hitler precisely because he campaigned on ending social justice extremism.

Trump delivered, eviscerating DEI and shutting the border immediately after taking power.

But then Trump didn’t deliver, starting another Middle Eastern war after campaigning on not starting any more Middle Eastern wars.

So, as the 2028 presidential election heaves into view, not only has Woke One failed, but so has Trump Two.

So, down which road does Anglosphere politics veer now?

Inevitably, the Left is going to move in the same economically populist direction the Trumpified GOP did a decade ago and ease up on the men-can-get-pregnant-too nuttiness. Social hyperliberalism remains catnip to the professional-managerial class (PMC), but even the most delusional progressives seem to have now accepted that it is electoral poison.

But aside from greater focus on bread-and-butter issues, what does the political future hold?

Technocracy, neo-socialism, populism?
Aaron Renn recently pondered whether the post-Trump era will deliver “a durable governing majority” or “just another oscillation in a deeply polarized, nearly 50/50 nation?”

The tl;dr is that, using a left-right, populist-institutionalist matrix, Renn suggests four possible outcomes post-2028.

Given the US is the sun around which the rest of the Anglosphere revolves, I’d expect nations such as Australia, New Zealand and Canada to follow the US’s political lead. As they did with, first, post-war social democracy and, later, neoliberalism. The UK is a special case given its parlous state, but it’s also likely to be influenced by American political developments.

Let me summarise Renn’s thoughts, then add my own.

Neo-socialism (aka left populism)

How it happens: A charismatic but somewhat moderate figure, say, the 2026 version of AOC, runs in 2028 and attracts enough voters desperate for change to win. Many of these voters will have previously voted for both Obama and Trump, hoping to disrupt the post-1980 neoliberal settlement.

What happens then: Dashed hopes, most likely. Populists are better at campaigning than governing, and the recent track record of deep blue US cities doesn’t inspire confidence.

Do I think it could happen? Absolutely, especially if Trump has now trashed the Republican brand to such an extent that voters who experimented with right-wing populism will now be ideologically flexible enough to give the left-wing variety a go. That noted, the PMC-dominated Left would need to remain laser-focused on pocketbook issues, which is a big ask. Membership of the Democratic Socialists of America is 80 per cent college-educated and 85 per cent white.

Left-Neoliberal Technocracy

How it happens: I’m not sure it does, but Renn suggests it involves Americans having fond enough memories of ’90s Clintonism to give the professional-managerial class a chance to redeem itself by delivering strong economic growth. A Rahm Emanuel candidacy attracts some previously Republican-voting PMCers and maintains the support – albeit lukewarm – of traditional Democrat constituencies.

What happens then: Presumably, it’s a return to the pre-Trump, uniparty status quo ante, except with added China scepticism, a touch of reindustrialisation, plenty of legal immigration, and a wide berth given to divisive social engineering projects.

There’s more likelihood of sensible, effective policy emerging from a technocratic regime than a populist one. The catch is the benefits of those policies are likely to flow disproportionately to technocrats and plutocrats, rather than Joe Sixpack.

Do I think it could happen? I have my doubts. The pandemic lockdowns were a Chernobyl-level delegitimisation event for the West’s expert class. More generally, the PMC throughout the Anglosphere has spent the last decade making itself look not just imperious (which is potentially forgivable) but ridiculous (which is not).

MAGA Popularism (right-institutionalist)

How it happens: This is basically the centre-right version of left-neoliberal technocracy, helmed by a figure such as Marco Rubio.

What happens then: As with left-neoliberal technocracy, it’s a return to the pre-Trump status quo ante, with a few sops to the disaffected masses. Such as a little less immigration, free trade and military interventionism.

Do I think it could happen? I suspect right-coded technocracy will be as on the nose with voters in 2028 as the left-coded variety and for much the same reasons.

Trumpless Trumpism (right-populist)

How it happens: A Trumpian figure – presumably JD Vance – advocating Trumpian policies gets over the line, as the OG did in 2016 and 2024.

What happens then: In a perfect world, all the good parts of Trumpism without any of the bad.

Do I think it could happen? I don’t think you can have Trumpism without Trump, who is – whatever else he is – a once-in-a-generation political figure. I’m also not quite sure how Trumpless Trumpism will differ much from MAGA Popularism, aside from the former being more hardline on issues such as immigration.

As an aside, both the Left and Right face a dual-constituency headache with both axes of the political matrix. The policies that will appeal to the parties’ core constituencies, be it university professors or small business owners, are exactly the tired old neoliberal policies the swinging-voter masses object to.

The AI wildcard
If AI doesn’t significantly disrupt the labour market between now and November 7 2028, my guess is the Democrats win the next presidential election. In that scenario, I’d predict the Democratic candidate will attempt to thread the needle between left populism and left-neoliberal technocracy. This was, more or less, the approach taken by Biden, Obama and Clinton and, more recently, advocated by ‘Abundance Liberals’ like Ezra Klein.

However, I’m near certain AI will significantly disrupt the labour market over the next couple of years. That being the case, I suspect we are in for a dose of full-blooded, anti-PMC, anti-plutocrat left or right populism. My fear is that the world will look a lot more 1930ish than 1970ish if jobs start evaporating in earnest as AI becomes more powerful and widely deployed over the next couple of years.

I can’t quite believe I’m typing these words, but it’s entirely possible the febrile, cancel-others-before-they-cancel-you Woke era may look like the calm before the storm in retrospect.

Humanity is not a monoculture. People’s diverse values represent different tradeoffs they would make on important issues. There is no technological solution that can align with everyone’s opposing interests and values at once. Any singular superintelligence would have to prioritize some values over others and in the process would be incapable of being benevolent to everyone…

Which outcome we get depends on the balance in progress between automation on one side and individual empowerment and invention on the other. If the labs focused on automating knowledge work lead, then I expect people and the economy will have a much harder transition.
Mark Zuckerberg, The Future is for Everyone: The Path to a Positive AI Future, 10/8/26

Whether you talk with engineers, venture capitalists, founders or managers, or with doomers, accelerationists, lefties or libertarians, the so-called San Francisco consensus on the impact of A.I. for workers is bleak. Many are convinced that advanced A.I. will soon surpass human capabilities. This would produce tremendous growth and scientific achievement, but it would also displace millions of jobs as fewer humans are needed to make the economy run. The technology will depress economic mobility and exacerbate inequality, while ferrying power and wealth to the A.I. companies and the existing owners of capital.

This premonition is not a well-kept secret.
Jasmine Sun, The New York Times, 30/4/26

It’s not a particularly partisan point to observe that recent decades have been kind to ‘the one percent’, as well as large swathes of the professional-managerial class, but not so kind to everyone else.

Yes, big-screen TVs are remarkably cheap and citizens of the Anglosphere now have a more diverse range of culinary options, but that doesn’t appear to have been of much consolation to the economically squeezed, culturally disrespected and disenfranchised (see mass migration/multiculturalism) unlettered classes.

But this isn’t another rant about the plutocrats and PMC conspiring to feather their own nests at the expense of those in the bottom three to four quintiles of the income distribution.

It’s about what happens to the class structure when AI automates away cognitive labour.

What the post-automation world looks like
AI is coming for the knowledge workers first, so let’s focus on that.

What happens to societies when the lawyers face a tough labour market? Nothing good, I’m predicting, judging by the historical record from 1789 onwards. But I got Claude to do a literature review and here’s what thinkers more eminent than I are predicting.

The first interesting thing my digital overlord informed me of is that relatively few people have given the question much thought.

Economists measure which work is taken from whom and what it does to wages – but a distribution of income is not a class, which is also a boundary, a recruitment mechanism and an idea of a life well spent. Sociologists study algorithmic bias in hiring and credit, treating AI as a sorter within the class structure rather than a force that reorders it. The post-work futurists vault straight to redistribution.

Claude did remind me that some of the bolder public intellectuals have been clear-eyed about how the current class structure came about and provided clues about what could be coming next.

Goodhart on the current PMC-friendly class structure
Head Hand Heart (2020) divides society by the kind of labour performed – cognitive, manual, caring – and shows how the cognitive class has terraformed Anglosphere societies – expanding higher education, making graduate credentials the gate to 40 per cent of jobs, and installing its own idea of a successful life as everyone’s.

To use two terms he coined that have now entered the political lexicon, Goodhart has long argued that cosmopolitan globalist PMC ‘anywheres’ have been lording it over working class and lower-middle class ‘somewheres’ for decades.

Turchin on what happens when AI comes for the elites
Turchin was banging on about the socially destabilising threat of counter/surplus elites long before ChatGPT dropped in late 2022. But not long after it appeared, he wrote When A.I. Comes for the Elites.

The tl;dr?

Technological shocks matter politically in proportion to their victims’ social power, not their numbers.

Nobel laureate economist Wassily Leontief observed that America’s horse population collapsed from 21 million in 1900 to 3 million by 1960, displaced by the internal combustion engine, and warned that human labour could go the same way. Turchin notes what didn’t follow the automation of horsepower. The horses didn’t mobilise, and none made a break for freedom on the way to the glue factory.

Non-graduate men, the post-industrial era’s workhorses, fared better than their equine counterparts in recent decades, but not by much (see flat real wages, falling life expectancy, quiet despair). Their only recourse was – eventually – voting for populist politicians promising to raise the living standards and status of the non-university educated.

Two other interesting observations from Turchin.

AI threatens the credentialled. Turchin uses the legal profession as a case study.

In the US, lawyer numbers nearly tripled per capita between 1970 and 2010. During the 1990s, the starting-salary distribution split in two, and by 2008 it had one peak around $190,000 and another around $60,000, with almost nothing in between. About half of graduates landed in the lower peak, many of them carrying $160,000 or more in law school debt.

You might even say there are now two types of lawyers. The elite ones, who make at least 5X the median salary, and surplus elite ones, who struggle to make even double the median salary.

As an aside, while it’s directionally correct to assume AI-driven automation will eviscerate the PMC, I suspect, in the messy real world, the process will be somewhat more complicated. A fraction of PMCers will – like those law grads fortunate enough to secure grad roles at white-shoe law firms – leverage AI to do well for themselves, at least for a while.

But most won’t. Which brings us to Turchin’s second thought-provoking observation:

The rise of intelligent machines will undermine social stability in a far greater way, than previous technological shifts, because now A.I. threatens elite workers – those with advanced degrees. But highly educated people tend to acquire skills and social connections that enable them to organize effectively and challenge the existing power structures. Overproduction of youth with advanced degrees has been the main force driving revolutions from the Springtime of Nations in 1848 to the Arab Spring of 2011.

Milanovic on the crack-up of homoploutia
Branko Milanovic is an economist and former senior World Bank employee.

His contribution to class analysis is coining the term Homoploutia – Greek for “same wealth”. Milanovic argues for something previously considered impossible.

Classical class analysis, Marx’s included, rests on capital and labour income accruing to different people – the rentier and the worker are distinct persons with opposed interests.

Milanovic’s finding is that at the top they’ve fused. Roughly a third of America’s income-rich now sit in the top decile of both labour and capital income – the surgeon or senior software developer who is well remunerated, asset rich and heavily invested. The group is about three per cent of the US population. Its share of income has risen steadily for forty years.

Milanovic calls the result “homoploutic capitalism”.

The pertinent question is what happens when the fortunes – and hence interests – of the surgeon and the senior software developer diverge. The political alliance is currently held together by high labour income. As widely reported, AI is taking away the high labour income from software developers. It may well do the same to surgeons, but that’s probably not going to happen for at least another 5-10 years.

So, does the elite de-fuse back into a pure rentier class?

Autor on AI’s democratising potential
Of course, there are some techno-optimists who believe AI automation won’t be all bad. Or that it will at least raise up some cognitive labourers, albeit at the cost of deskilling others.

In a 2024 paper, Applying AI to Rebuild Middle Class Jobs, MIT labour economist David Autor argues that what makes elite professional work valuable is expertise – tacit, hard-won judgement that can’t be reduced to rules. Computers struggled to undercut human expertise because they needed explicit instructions.

Once again, AI is different. It handles tacit knowledge and probabilistic judgement, so its distinctive capacity is to extend the reach of expertise. It could let workers with foundational training but no elite credential make higher-stakes decisions currently reserved for experts.

The nurse practitioner does more of what the physician does; the paralegal more of the lawyer’s work. The expert isn’t replaced exactly, but expert work is made performable by more people.

All going well, that would rebuild a middle tier of skilled, decently paid work. But presumably this would lower incomes and social prestige for those currently in the upper echelons of the PMC. The nurse and paralegal’s gain is likely to be the doctor and lawyer’s loss.

Brynjolfsson on why early career workers are screwed
For their paper “Canaries in the Coal Mine?”, Brynjolfsson, Chandar and Chen reviewed recent payroll data for tens of millions of American workers. They found that, since generative AI became widespread, workers aged 22–25 in the most AI-exposed occupations have seen a 16 per cent relative decline in employment (relative to older workers and less-exposed occupations, not an absolute collapse).

However, employment for experienced workers in the same occupations is stable or growing, so the effect is generational, not occupational.

If you’re over 25, this probably accords with your own ‘lived experience’. Chances are you still have your job but have noted that your employer isn’t taking on as many new staff, especially early-career ones.

Like horses and displaced manufacturing workers, recent grads looking for a job don’t have much clout. They may also be hesitant about engaging in any political action lest it make them less attractive to potential employers.

Here’s the rub, though.

The bottom rungs of the PMC class ladder are disappearing. The PMC reproduces itself by recruiting – those at the top and bottom simply inherit their class position, while middle-class strivers have to achieve theirs. If the PMC stops recruiting, it eventually turns into a shrinking, ever-more-enervated caste.

Five visions of a post-automation world
The five thinkers mentioned above have different forecasts in terms of what’s coming for the PMC. But it’s telling that even the most optimistic flag a period of turbulent transition with significant intra-class – along with, presumably, inter-class – conflict.

Even back in the pre-ChatGPT era, Goodhart was warning of a populist backlash against PMC domination. While he doesn’t appear to have yet opined on the effect AI automation will have on this backlash, it’s not unreasonable to assume there will be precious little sympathy on offer from the class the PMC has spent the last half century managing and morally instructing.

Turchin has long warned that the overproduction of elites leads to revolution. AI is now beginning to move many cognitive labourers from the status quo-supporting ‘elite’ column to the ‘disaffected surplus elite’ one.

Milanovic’s work also raises the issue of what happens when the ‘top three per cent’ really does become ‘the one per cent’. Or the 0.01 per cent. Do all those senior software developers used to making 5-10X the median salary just shrug their shoulders and declare, “Ah well, it was good while it lasted,” once automated out of a job?

What happens if Autor is on the money? How will highly qualified, high-earning, high-social-status professionals react to having their lunch cut by those they regard as less qualified, competent and worthy?

If Brynjolfsson et al are onto something, does the intergenerational conflict that’s long been building in Anglosphere societies finally explode?

All five are describing the same door closing from different angles.

Goodhart’s cognitive class loses its authority and agenda-setting dominance; Turchin’s surplus elites lose their futures; Milanovic’s fused elite splits apart; Autor’s professionals lose their occupational-licensing moats; Brynjolfsson’s graduates never get a start in the corporate rat race.

Whither the PMC?
The PMC has long proudly claimed it was open to talented newcomers, that it was a class anybody could potentially join. Study hard, get the credential, then come on in. After all, Anglosphere societies are well-functioning meritocracies.

But take away the entry ramps and all that’s left is an imperilled priestly caste with a self-flattering narrative about itself.

I’ll close with a prediction I’m confident about making.

Unlike no-longer-necessary horses and displaced blue-collar workers, the PMC will not go gentle into that good night.

A man in my position can’t afford to be made to look ridiculous.
Jack Woltz, The Godfather, 1972

A lot of what you’re seeing as attacks on me, quite frankly, are attacks on science.
Anthony Fauci, MSNBC, 9/6/21

I think you’re the problem, the media. And speaking of loathing, you’re loathed far more than I am. And you don’t seem to even realise that.
Elon Musk, The Economist, 23/7/26

Can we now call time on the pernicious cult of identity politics, and liberate ourselves from the demented creed which has convinced universities, corporations and politicians that the only way to eradicate prejudice is to classify everyone by their immutable characteristics? Can we simply accept that not everything in life is racist… Alas, our opinion-transmitters will learn no lessons.
Annabel Denham, The Telegraph, 3/8/26

We were a few years into Black Lives Matter, and, of course, the first year of Trump’s first term. The Great Awokening was well underway, and over the next few years, culminating in the summer of 2020, the media industry would come to resemble a grumpy religious sect, with its theological dogma and mechanisms for punishing dissent. It became a suffocating place for anyone who wanted to think the least bit freely. In Substack, journalists who refused to bend to the new rules had a refuge to escape to.
Leighton Woodhouse, Unherd, 5/8/26

You’re probably already familiar with the latest self-beclowning of a prominent professional-managerial class institution, so I’ll keep this brief.

Jason Arday, much-feted as Cambridge’s youngest-ever black professor, built his reputation on an extraordinary backstory. Diagnosed autistic at three, he claimed he was non-verbal until 11 (or 12 in some accounts) and unable to read or write until 18.

Other claims included appearing in the documentary series Seven Up (whose subjects were born decades before Arday), running 600 miles in six days (near world-record pace; later revised to 12 days), raising £5.5m for charity (later attributed to a 100-person syndicate), and being twice menaced by a masked knifeman, with a pig’s head sent to his parents’ home. Arday said police traced the pig’s head to a butcher; the Met said no such investigation took place.

‘Far Right’ philosopher Nathan Cofnas – formerly of Cambridge, now at Ghent University – broke the story in a Substack post, finding more than 30 passages of Arday’s 2015 PhD thesis substantially overlapped an earlier Brunel University dissertation.

Analysis by The Telegraph identified around 100 matching passages, while Retraction Watch revealed Times Higher Education had spiked an article about Arday’s plagiarism in 2025 after he engaged pricey libel firm Carter-Ruck.

You’re not going to believe this, dear reader, but Arday called the allegations against him a “racially motivated” campaign. Prominent supporters, including Greens leader Zack Polanski and plenty of (hitherto) respected academics, were desperately eager to believe that Arday was a victim of bigotry rather than a shameless con artist. A chancer as they’d say in the UK.

I must confess to a begrudging respect for the audacity of Arday’s con, which I can enjoy fully knowing no widows were robbed of their life savings. Talking your way into a professorship at one of the world’s most prestigious universities is a truly impressive feat of what we Australians call bullshit artistry.

At the time of writing, Arday has just resigned, presumably with some encouragement from his employer. That employer has trashed a brand built on the achievements of alumni and/or staff such as Charles Babbage, Lord Byron, Oliver Cromwell, Francis Crick, Charles Darwin, Stephen Hawking, John Maynard Keynes, Lee Kuan Yew, John Milton, Jawaharlal Nehru, Isaac Newton, Sylvia Plath, Salman Rushdie, Bertrand Russell, Alan Turing, Ludwig Wittgenstein and William Wordsworth.

Even at this early stage, it’s clear this will be a more luridly attention-grabbing news story than the defenestration of the first black president of Harvard, Claudine Gay. A defenestration largely orchestrated by ‘Far Right’ activist, writer and filmmaker Chris Rufo, who got the ball rolling by detailing Gay’s plagiarism on, yes, his Substack.

Will our opinion-transmitters learn any lessons from this latest debacle?

I fear not, given they remain in thrall to identity politics.

21^st century Lysenkoism
Lysenkoism was the doctrine, dominant from the mid-1930s to the mid-1960s, that heredity could be reshaped by environment. Trofim Lysenko rejected Mendelian genetics as bourgeois fiction, arguing that plants conditioned by treatments such as chilling would pass the acquired traits to their offspring.

University professor-types might recognise this as Lamarckism dressed in dialectical materialism.

Lysenko was black, neurodiverse, gay, trans, female a Ukrainian peasant’s son, the ideal proletarian scientist to set against bourgeois academics.

Fortuitously, his novel doctrine implied nature was as malleable by human will as society.

In 1948, genetics was declared pseudoscience in the USSR. Attacks on Lysenko were considered, quite frankly, attacks on science. Geneticists were dismissed or imprisoned; Nikolai Vavilov, the world’s foremost plant-breeding scientist, starved to death in prison in 1943.

Soviet biology lost a generation, the bountiful harvests never arrived, and the doctrine was exported to Mao’s China, where it worsened the Great Leap Forward famine.

These things are difficult to quantify, but there’s no doubt Lysenkoism contributed to famines that killed tens of millions.

Might there be some parallels between mid-Soviet era insanity and the contemporary Anglosphere variety? Let’s list the common features.

*Political usefulness shields weak work from appropriate scrutiny.

*Arguments are judged by conformity to a political premise rather than by method. (The Grievance Studies hoax of 2017 – itself a rerun of the Sokal hoax of ’96 – was designed to illustrate exactly this.)

*Dissenters lose positions rather than arguments. After Cofnas published a 2024 Substack blog arguing that race is linked to academic ability – a thought that may well have occurred to anybody who’s ever set foot on an Anglosphere university campus – Emmanuel College, Cambridge terminated his research associate status. The college distanced itself from Cofnas’s arguments but didn’t feel the need to refute them.

*Both Lysenkoism and identity politics rest on a doctrine of infinite malleability. Lysenko held heredity plastic and environment sovereign while blank-slate social science holds group differences wholly socially constructed.

More charitable readers might object that identity politics hasn’t (yet) become as deadly as Communist totalitarianism, which is a fair enough point.

They might also claim that Arday’s ouster is proof the system (eventually) works. This is more debatable. It wasn’t the legacy media that brought Arday down, nor was it Cambridge, which initially backed him strongly.

It was a philosopher the university had already shown the door for wrongthink, publishing his findings on a gatekeeper-free blogging platform.

Granted, The Telegraph and – surprisingly enough – The Guardian then did some solid investigative reporting. But the institutions didn’t correct themselves; they were corrected from outside, by the type of people they’ve long marginalised.

The upsides of identity politics (for the PMC)
Given the premises of identity politics are as debatable as those of Lysenkoism, the question arises why identity politics remains so popular with opinion-transmitters, who hail near-exclusively from the putatively learned professional-managerial class.

Let me relate some of the leading theories explaining the PMC’s indefatigable championing of sacralised minorities.

The displacement thesis
Adolph Reed, Walter Benn Michaels and Nancy Fraser argue that identity politics allows a critique of inequality that leaves the critic’s own position intact. Demanding proportional representation within a hierarchy is compatible with the hierarchy. The aspiration becomes not less inequality, but inequality distributed more equitably by demographic category. For a class that has itself done well out of economic sorting, it is the one radicalism that costs nothing. Fraser calls it a shift from redistribution to recognition. Catherine Liu makes a version of this argument, positing that the PMC requires a justification for its authority other than having done well out of the existing arrangement, and moral leadership supplies one.

Intra-elite competition
This draws on Peter Turchin’s theory of elite overproduction. Societies train more people for elite positions than they have positions to give them. The army of credentialled applicants multiplies; the number of, say, professorships does not. The weapons available to those facing a grim ‘surplus elite’ future are not economic but moral, and denouncing a rival becomes a way of advancing. Turchin doesn’t claim the cancel-culture enthusiasts are consciously Machiavellian. But he does suggest that when people are competing ferociously for scarce resources, the line between sincere belief and career strategy gets blurry.

Status signalling
Rob Henderson calls these “luxury beliefs” – Veblen’s conspicuous consumption applied to opinions rather than possessions. Where a Victorian gentleman advertised his standing with an impractical coat, the modern professional does it with positions that are cheap for him to hold and expensive for everyone else. Defunding the police polls well in neighbourhoods that can afford private security, less so in crime-ridden ghettos.

Regrettably, the PMC’s bottomless appetite for white saviourism has had some downsides. Curiously, identity politics doesn’t seem to have done much to improve race relations. It’s played a significant role in the collapse of institutional trust, especially in PMC-dominated institutions such as academe and the legacy media. And antipathy to identity politics has been a major driver of the populist backlash among the working class throughout the Anglosphere.

Winter is coming
Given they are unlikely to do it for the greater good of their society, let me conclude by attempting to convince my fellow PMCers to stop punching themselves in the dick out of pure self-interest.

The PMC has long argued its material advantages were earned by its moral stewardship – we do relatively well for ourselves, but we’re the ones who care about justice. And what kind of society would it be without PMC social justice warriors vigorously policing the Overton window? A Far Right hellscape, no doubt!

But, ahem, ‘progressive overreach’ has now drawn the PMC’s account with the rest of society down to zero.

The PMC is almost certainly entering a period of extreme economic vulnerability. It’s doing so having antagonised not just the working class but also plutocrats such as Elon Musk.

AI may well come for the proles soon and even the plutocrats eventually, but it’s coming for the cognitive labourers first.

Unless those cognitive labourers rethink their ideological enthusiasms soon, it seems they’re doomed.

In 2023, an A.I. system passed the bar exam. In 2025, the technology helped scientists identify a suspected cause of Alzheimer’s disease. In May, A.I. had advanced so far that it solved a complex math problem that had stumped experts for 80 years. Last week, two A.I. systems under testing went rogue and hacked into a company’s database…

In size and ambition, this moment compares to the building of the railroads in the 1800s, President Franklin D. Roosevelt’s New Deal in the 1930s, and the Manhattan Project to create an atomic weapon in the 1940s, technologists said…

Dario Amodei, the chief executive of Anthropic, has said that if these [scaling] laws hold for another year or two, A.I. will be able to perform huge amounts of white-collar work. Demis Hassabis, the head of Google’s A.I. lab DeepMind, wrote recently that A.I. could usher in “10x of the Industrial Revolution at 10x the speed”…

“There’s going to be millions of jobs destroyed, millions of jobs created,” said Erik Brynjolfsson, an economist who is the director of Stanford University’s Digital Economy Lab. “That’s going to be very difficult. Even if new jobs are created, they’re not the same jobs.”
Adam Satariano, Paul Mozur, Jacqueline Gu and Cade Metz, The New York Times, 29/7/26

For some time, I’ve felt like someone standing on the deck of the Titanic warning of an iceberg getting ever closer as the other passengers go about their business telling themselves that either no iceberg exists or, if it does, it’s no big deal and the ship’s captain will undoubtedly change course in time to avoid hitting it.

On the plus side, Serious People – and Serious Journals of Record that shape elite opinion, such as the New York Times – have now admitted that, yes, there is an iceberg, and, yes, the labour market is likely to crash into it in a spectacular fashion.

As Brynjolfsson, among many others, has pointed out, millions of jobs are now in the process of being automated away.

Even in a best-case scenario where AI does create new jobs – a prediction many, including me, are sceptical of (why wouldn’t AI just do these new jobs, as well as taking over the ‘old’ ones?) – profound labour market carnage is coming. And as events of the 1930s illustrate, once labour markets experience significant disruption, it’s not long before the existing political settlement comes under intense pressure.

Shouldn’t humanity be a tad more concerned?
In the week off I took from AI doomerism, here are just a few of the AI stories that broke.

• During an internal test, OpenAI ran two models – with the guardrails deliberately off, it should be noted – in a sandbox measuring their ability to exploit software vulnerabilities. Instead of completing the test, the models escaped the sandbox via a zero-day exploit, reached the internet, and broke into Hugging Face’s production systems to steal the answer key. But nobody instructed or predicted it; containment failed, and it’s the first documented case of AI autonomously chaining real-world attacks.

• *Shortly after this incident, more than 1,100 employees at OpenAI, Anthropic, Google and Meta signed an open letter asking the US government to support international pacing mechanism infrastructure that would make a verifiable, coordinated slowdown possible if AI outpaces human oversight.

  Here’s the money quote:

  “There is a real risk that capability development rapidly accelerates beyond our ability to understand or control the resulting systems… But each company—and country—is under intense competitive pressure not to unilaterally slow that acceleration. And today, the world lacks the technical and governance tools to deliberately pace frontier-wide progress.”

• *Substack launched reader-facing AI detection in partnership with Pangram, a detection startup. Readers can scan any post, note, reply or comment for an estimate of how much was machine-written.

  
  To those not in the content-creation game, this may seem less consequential than an AI system escaping containment. But it illustrates the same underlying problem: once machine intelligence becomes abundant, recognisably human intellectual production becomes harder to identify and less valuable.

  
  Announcing the move in a post entitled Against Claudefishing: Building trust in the AI age, Substack co-founder and CEO Chris Best cited Pangram’s estimate that as much as 40 per cent of the text on some social media platforms is now AI-generated “soulless slop”. He argues content consumers have a right to know whether what they’re reading is entirely or largely AI-generated. And, likewise, non-Claudefishing human creators have a right to be able to monetise their work in a marketplace increasingly being flooded with the machine-made variety.

  
  As Best put it:

  
  When content made by no one takes over parts of the internet that are supposed to be human, it pollutes the commons and makes it hard to discover and hear human voices. When readers have to wonder if what they’re reading is real, it undermines trust in authorship and threatens the livelihood of writers—including those who use AI tools thoughtfully to produce work they believe in. Platforms that reward fakeness will create a race to the bottom.

All stories worthy of a post in themselves. And before I’m outed by man or machine, let me confess my secret shame of being – within certain, broad limits – a degenerate Claudefisher.*

But let’s stick with humanity building a digital Golem and examine this recent post from Noah Smith entitled What will more intelligence actually do for us?

The upsides and downsides of building a superior intelligence
With remarkable insouciance, Smith observes that AI is now smarter than its human progenitors.

He states plainly that “humankind has invented machines that are smarter than we are” and that “’AGI’, or ‘ASI’, or whatever you want to call it, is certainly here.” Granted, he acknowledges machine intelligence is “spiky” – superhuman in some domains, weaker in others – but says remaining human advantages “disappear almost as quickly as we can identify them”.

The only good news for those humans nervous about welcoming our new omniscient overlord is that intelligence probably isn’t infinitely scalable. To summarise, while AI is already smarter than the smartest humans (i.e. those in the 170-plus IQ range), it may run into the law of diminishing returns and not get much smarter than that.

The implication is that AI might plateau at a Goldilocks level of intelligence: smart enough to be incredibly useful to humanity, but never so far beyond us “as we are beyond dogs”.

Smith predicts the big gains will come from replicability, data-handling and speed rather than ever-greater raw smarts. Whether that also means humanity stays in control is a question he doesn’t address.**

So, what are the big gains we can look forward to with, to use the industry terminology, somewhat-constrained Artificial General Intelligence (AGI) rather than sci-fi Artificial Super Intelligence? (AGI can match humans across all cognitive tasks, while ASI superintelligence surpasses the best humans at everything.)

• You can build more of it. Human brainpower is limited by how many people are born. Machine brainpower is like factory equipment: want more, build more. Everyone ends up with an army of smart helpers.

• It can capture know-how that lives in people’s hands. The best manufacturers succeed through thousands of small tricks no one has ever written down. AI watching and analysing everything on a factory floor could learn those tricks, improve them, and spread them — making whole economies more productive.

• It can spot patterns too complex for any human brain. AI mastered language without anyone ever working out the “rules” of language. Smith thinks other fields — economics, physics, materials — may hide similar patterns, and AI finding them could spark a scientific golden age.

Smith is curiously silent on the potential downsides of the AGI that he believes “is certainly here”. But let me sketch out a few (entirely predictable) cons that might come along with the pros of AGI.

• Concentration of power. Frontier capability sits with a handful of companies and states, with enormous economic and geopolitical leverage attached.

• Labour disruption. Even without mass unemployment yet, AGI-level systems can do most cognitive work, threatening white-collar professions, entry-level jobs and wage bargaining power over time.

• Dependence and deskilling. As AI absorbs cognitive work, human expertise and judgement may atrophy.

• Misuse by bad actors. The same powerful capabilities that can be used to come up with a cure for cancer can also facilitate scams, disinformation, surveillance and weapons development.

The question Smith largely leaves unanswered is not simply what superior intelligence can do, but who will own it, who will capture its benefits and what will happen to everybody whose labour it devalues.

Titanic – a 21^st century take
Those of a certain age may recall that James Cameron’s Titanic was as big a deal as The Odyssey now is when it came out in 1997. This was around the zenith of what will probably come to be known as the neoliberal era. Yes, substantial power and wealth had already been redistributed from Labour to Capital, but the events of both 2008 and 2016 were far off in the future. (As were the events of 2001 and the start of the forever wars.)

But credit where it’s due – by the 1990s, the painful economic reforms of the 1980s seemed to be bearing some fruit. Economic growth was solid. Unemployment and inflation were low. Many people still believed the ‘American/Australian/Kiwi/Canadian dream’ of a stable middle-class lifestyle (marriage, home-ownership, children) was achievable.

Let me summarise the plot, both from the perspective of 1997 and 2026 in yet another attempt to illustrate the looming danger confronting mankind.

Rose DeWitt Bukater, who would otherwise be facing genteel poverty, has landed a plutocrat fiancé, the dastardly Cal Hockley. Rather improbably, Rose falls in love with a penniless artist, the salt-of-the-earth Jack Dawson.

Spoiler alert: the Titanic strikes an iceberg and Jack dies to ensure Rose lives (more on which shortly). Also rather unfeasibly, especially for that time period, Rose doesn’t return to Cal when she has the opportunity, instead choosing to live her life as an empowered girl boss.

Now, let’s look at this from a class perspective, with Cal representing ‘the one per cent’, Rose representing the professional-managerial class, and Jack representing the working class.

Even though it emerged at neoliberalism’s high point, the film spends some time illustrating the casual ruthlessness displayed by the aristos towards the peasants. The below-decks passengers inhabit a very different world to those with a first-class cabin. Cal thinks nothing of framing Jack for a robbery. When the ship is sinking, the steerage passengers are locked in their quarters.***

From a distance of three decades, the famous scene where Jack lets go of the door keeping Rose out of the freezing water has an added poignancy. From the 1980s onwards, the PMC was quite prepared to throw the working class off the door under the bus if that worked to its material advantage. At the very least, they were indifferent about what automation, along with globalisation, did to those travelling in steerage.

But now automation has come for the Rose DeWitt Bukaters of the world. That once-buoyant door they’ve been comfortably perched on in recent decades is becoming waterlogged.

The only question now is whether a lifeboat will arrive in time.

*Here are my Pangram results for this post, which was shamelessly AI-assisted.

**As Elon observed on a recent Newman-Petersonesque podcast, “I think it [humans remaining in control of AI] is unlikely. In the same way that if the difference in intelligence between AI and humans is vastly greater than the difference in intelligence between AI and chimpanzees, it’s hard to imagine that the chimpanzees would be in charge.” (To make the point more succinctly, just as humans are in charge of chimpanzees because we are smarter than them, AI will soon be in charge of us, for exactly the same reason.)

***There’s some debate about whether the locking-in of the ship’s lower orders actually happened, but around 60 per cent of first-class passengers survived against about 25 per cent of third-class ones. But there’s also the complicating factor of gender privilege – three-quarters of female passengers survived, as compared to 20 per cent of male ones.

The Wedding-Guest sat on a stone:

He cannot choose but hear;

And thus spake on that ancient man,

The bright-eyed Mariner…

He went like one that hath been stunned,

And is of sense forlorn:

A sadder and a wiser man,

He rose the morrow morn.
Samuel Taylor Coleridge, The Rime of the Ancient Mariner, 1798

It is quite true what philosophy says: that life must be understood backwards. But then one forgets the other principle: that it must be lived forwards.
Søren Kierkegaard, 1843

“If you can’t be a good example, then you’ll just have to be a horrible warning.”
Often attributed to Keith Richards, but apparently coined by British novelist Catherine Aird, circa the late 1980s

As a special birthday treat – for me, see more below – I’m giving the AI doomerism a rest this week. Instead, I’m doing something no other Substacker or journalist has yet thought to do – give Christopher Nolan notes on The Odyssey.

Before, like the ancient man I now am, turning that film review into a launching pad for a long-winded diatribe where I futilely attempt to force some of my hard-earned wisdom on the utterly uninterested younger generation.

1971 – the year everything started to go wrong
If you go to a website called wtfhappenedin1971.com, you’ll find a collection of over 75 charts all showing some economic or social trend that appears to bend sharply around 1971.

This is when:

• Nixon took the US dollar off the gold standard. Covering the impacts of this is a whole other post. But to summarise, it contributed to stagflation which, in turn, set the stage for the Thatcher-Reagan neoliberal revolution. More lastingly, it facilitated inflation, ballooning debt and asset bubbles. Some also argue it contributed significantly to the wage stagnation and rising inequality of the following five and a half decades.

• Pay started decoupling from productivity (i.e. wages began flatlining while productivity kept rising).

• The house-price-to-income ratio started getting out of whack. House prices have risen and fallen over the last half century, but the general trend has been unrelentingly upwards. In functional real estate markets, people can purchase a home for 3-4X their household income. That figure is now 10X-plus in many of the Anglosphere’s metropolises.

• While you can’t blame 1971 for the West’s collapsing fertility – that trend started in the late 1960s, as the post-war baby boom ended – it was around this time that people started having fewer children.

• Likewise, while you can’t neatly trace the rise in political polarisation to 1971, it was also around this time that those on the Left and Right stopped seeing those on the other side of the chamber as the loyal opposition and started seeing them as enemies determined to extinguish everything they hold dear.

• Once again, the start of the feminisation of society can’t be portrayed as starting in 1971. But in the post-WWII era, middle-class families began sending their daughters as well as sons to university. By the late 1960s/early 1970s, the first generation of PMC women were starting to take up roles other than nursing and teaching.

  
  Of course, female participation in the workforce had upsides – not least for university-qualified professional women – but as writers such as Helen Andrews have been noting of late, it also had downsides. (Amazingly, it turned out femininity also has a shadow side and not all the ills of the world are attributable to toxic masculinity.)

Inevitably, 1971 was the year I was born. Along with the likes of Marc Andreessen, Julian Assange, Sacha Baron Cohen, Elon Musk, Marco Rubio, Winona Ryder, Snoop Dogg, Justin Trudeau, Tupac and Mark Wahlberg.

If you widen the net to people born around 1971 (i.e. 1970-1972), you can add the following names to the list: Ben Affleck, Andre Agassi, Matt Damon, Cameron Diaz, Idris Elba, Eminem, Liam Gallagher, Geri Halliwell, Dwayne ‘The Rock’ Johnson, Sadiq Khan, Christopher Nolan, Gwyneth Paltrow, Priti Patel, River Phoenix, M. Night Shyamalan, Louis Theroux, Uma Thurman and Melania Trump. (Inconveniently, the Google founders, Sergey Brin and Larry Page, weren’t born until 1973.)

Nolan, Damon and I are all currently 55. While Odysseus’s age is never made clear, he’s somewhere in the 45-55 age range when he returns home.

Let me provide a 55-year-old’s perspective on The Odyssey.

The Odyssey – a middle-aged man’s perspective
Like many men of a certain age, I find race-neutral casting irritating, particularly when it’s self-evidently historically inaccurate. That noted, I didn’t find Nolan’s casting choices, with one exception, objectionable. After all, it is a fantastical yarn and, unless Nolan was going to confine himself to actors of Hellenic heritage, there was no getting around race-blind casting. Yes, Helen wasn’t Kenyan-Mexican, but neither was Odysseus of English, Finnish, Scottish and Swedish descent (as Damon is).

The one bum note in what is otherwise a magnificent symphony is the gimmicky casting of Elliot Page. Not so much because of the trans thing, but because it’s difficult for somebody who looks like a 14-year-old lesbian to pass as a battle-hardened soldier.

I’m also not concerned by Nolan overlaying Christian morality onto a pagan world. Isn’t the mark of a great work of art that it can be interpreted in a multitude of ways? Few of the musicians who’ve covered Leonard Cohen’s Hallelujah are Jewish Zen Buddhists. I doubt anyone not immersed in Judaism and profoundly influenced by Zen could have written that song. But that hasn’t stopped singers of all faiths and none delivering exquisite covers.

So, forget about what our American friends call Monday morning quarterbacking and watch the film at the earliest opportunity.

As is the case with many enduring narratives, The Odyssey isn’t really about military battles and monsters. Well, it is, but at a metaphorical level it’s about the journey through life with all the usual waystations on the hero’s journey. A journey even the least heroic are forced to embark on once they reach adulthood – departure, trial, temptation, loss, endurance, and the longing to reach somewhere that feels like home.

Sooner or later, we all have to navigate our own Scylla and Charybdis. Sooner or later, our hubris trips us up. Sooner or later, many of us realise we’ve been hitting the lotus flower (booze, consumerism, drugs, food, gambling, porn, sex, social media, workaholism) a little too hard for a little too long. And sooner or later, we all come to understand in our bones that everything will die – our loved ones, the world we once knew, and, most concerningly of all, us too.

The wisdom of the elders
I flirted with the idea of providing 55 pieces of life advice, but quickly realised that in today’s attention economy, ain’t nobody got time for that. So I cut it down to five.

Having now fully matured into a grey-beard loon, here are my tips for younger players.

There’s no such thing as a free lunch
There are endless variations of this life lesson. Some common ones are: “You don’t get something for nothing”; “There’s always a catch”; “You have to pay the piper”; “You can’t have your cake and eat it too”; “Everybody wants to go to heaven, nobody wants to die”; “There are no solutions only trade-offs” or – my favourite and Edith Piaf’s last words – “Every damn thing you do in this life, you have to pay for”.

The point is everything comes at a cost. The bill may not fall due immediately. But the longer you put off settling the tab, the more likely it is you’ll have to pay it back with interest.

You can easily judge the character of a man by how he treats those who can do nothing for him
The temptation to kiss up and kick down in whatever status hierarchies you’re enmeshed in is ever present. Your life – and the lives of those around you – will be happier if you resist it. (If you’re going on a first date, observe how your potential paramour treats the waiter. If they’re obnoxious, understand they’ll be treating you in a similar fashion down the track.)

Be nice to people on your way up, because you’ll meet them on your way down
Further to the above point, individuals, organisations, classes, ethnic groups, generations, nations and civilisations that are currently at the top of a status hierarchy often assume that their fortunate circumstances will endure indefinitely. This typically results in the belief they can endlessly kick down on individuals, organisations, classes, ethnic groups, generations, nations and civilisations less fortunately located.

I’ve failed to convince my fellow members of the professional-managerial class to take this approach, but it’s always worthwhile considering how you treat those who currently have less clout than you. And how they might treat you, should the tables be turned someday.

If you don’t run your own life, somebody else will
Unless you’re independently wealthy – and, often, even then – you’ll have limited control over your own destiny. But you do have some control and should guard it jealously. I can’t guarantee pursuing the life you want will end in happiness. But leading the life someone else has chosen for you often leads to unhappiness. As we Australians often observe, you ‘don’t want to die wondering’ about what could have been had you’d been a little bolder.

Advice is largely useless
One of the highlights of my magazine journalism days, back in the Beforetimes, was getting to spend a few hours chatting with Christopher Hitchens. For some reason, we got on to the subject of what advice he’d pass on to his three children.

Here’s what Hitch told me:

The one thing that does not transmit across the generations is advice about love and marriage. Everyone has to find out by making their own ridiculous blunders. No, if that sort of advice could be transmitted generationally, we would have evolved incredibly fast. It can’t be, and advice of that sort isn’t taken anyway, even if it’s good.

And therein lies the tragedy. The curse of the grey-beard loon is the same as that of Cassandra – you may be telling the truth, but nobody is interested in hearing it. Especially those who would most benefit from it.

As Hitchens observed, it is near impossible to transmit any wisdom you’ve accrued to others. Like Odysseus, every man and woman must set out on their own voyage, fight their own battles, betray others and be betrayed in turn, then learn from their own costly mistakes.

That is how Zeus has willed it.

“[AI] is replacing, in some cases, lower value human capital with the financial capital and the investment capital we’re putting in.”
Standard Chartered CEO Bill Winters, 19/5/26

The same thing that happened to farm labor, and the same thing that happened to manufacturing labor, is now coming for knowledge work… the question becomes: if wage labor has been the primary distribution mechanism in a labor-based system, what happens when labor is no longer the main mechanism…

If every household has voting shares and stakes in robotics companies, data centers, the power grid, chip manufacturers, and other core assets, then households benefit from what those companies do. They also have a say in how those companies operate. That expands democracy into the marketplace.
David Shapiro, 14/7/26

When we look back on this time in the decades to come, I think we will realise we were standing in the foothills of the singularity – nothing less than the dawning of a new age for humanity… But to realise its immense promise, we have to navigate this critical period of development thoughtfully and carefully. Urgent action is needed to address risks that might arise as we get closer to AGI.
Demis Hassabis, 14/7/26

For the last 18 months I’ve been banging out Substack posts with monotonous regularity that point out AI is already disturbingly powerful, is rapidly becoming more powerful, and that this is inevitably going to significantly disrupt labour markets thereby profoundly transforming economies and societies.

The problem those of us offering these warnings have faced isn’t so much disbelief as inertia. Plenty of people, not least members of the politically influential professional-managerial class, have been worried about being automated out of a job for some time.

But unlike Large Language Models, human beings are emotional not logical entities. Confronted with a life-changing event, a human’s typical reaction isn’t to immediately devise a cunning plan to navigate the upcoming transformation as best as possible. It’s to embark on a prolonged, five-stages-of-grief journey. Here’s how that has played out over the last four years.

Denial: “AI is just a stochastic parrot”, “AI can’t really write/code/reason”, “AI will only ever be used to augment, not replace, human labour”.

Anger: Lawsuits over training data, artist, actor and author backlash, ‘AI slop’ as a term of abuse, publications banning AI-generated content.

Bargaining: “AI won’t take your job, but a person using AI will”, “AI is fine for first drafts, but humans will always have to do the final edit”.

Depression: See the tsunami of “Is my career over?” LinkedIn posts from struggling copywriters, illustrators, translators, junior developers and graduates. A general sense of fatalistic resignation in many professional forums.

Acceptance: AI is already disturbingly powerful, is rapidly becoming more powerful, and this is inevitably going to significantly disrupt labour markets thereby transforming economies and societies. Maybe it’s time to get serious about devising a cunning plan to navigate the upcoming transformation as best as possible?

We must act now
At the start of this week, an impressive slice of high-value human capital from across the occupational and political spectrum – Daron Acemoglu, Yoshua Bengio, Ben Bernanke, Tyler Cowen, Jeff Dean, Niall Ferguson, Reid Hoffman, Vinod Khosla, Paul Krugman, Yann LeCun, Alvin Roth, Eric Schmidt, Michael Spence, Joseph Stiglitz, Max Tegmark and Jerry Yang – conceded the warnings long issued by a smaller, more prescient slice of elite human capital – Sam Altman, Dario Amodei, Nick Bostrom, Mo Gawdat, Tristan Harris, Stephen Hawking, Geoffrey Hinton, Elon Musk, Stuart Russell, Ilya Sutskever, Jaan Tallinn and Eliezer Yudkowsky – were directionally correct.

Those on the first list of names added their imprimatur to We Must Act Now: A Statement on AI’s Transformation of the Economy. Here’s what the statement, um, states:

1. AI may become radically more powerful over the next 10 years.

2. This could drive an unprecedented transformation of our economy, larger than the Industrial Revolution, but unfolding over a vastly shorter time frame. It could bring risks, including large-scale job displacement, as well as opportunities such as major gains in living standards.

3. Economists, policymakers and technology leaders must act now to understand the economics of transformative AI and to build the incentives, guardrails, and institutions needed to steer AI in a direction that complements humans and benefits society.

The only quibble I have with those 88 words is the following – “over the next 10 years”. Barring an apocalypse, AI will be unimaginably more powerful in 2036 than it is now, but this isn’t an issue we’ve got a decade to address. Even the (in comparison to what’s coming) unspectacular AI currently available is powerful enough to automate vast swathes of white-collar work.

Those at the coalface expect vastly more powerful AI – call it what you will: transformative AI, Artificial General Intelligence (AGI), Artificial Superintelligence (ASI), recursively self-improving AI, an intelligence explosion, rapid take-off, the Singularity – to arrive by 2030 and, potentially, as early as 2027.

To coin a phrase, humanity has continued to enthusiastically summon the AI demon without engaging in much due diligence around (a) who will (initially) control the demon and, rather more importantly, (b) whether the demon can long remain under human control.

What benefits society?
It’s become a motherhood statement to aver the benefits of AI should be spread around rather than captured by elites. That, as the cream of the human capital crop asserted earlier this week, policymakers should “steer AI in a direction that complements humans and benefits society”.

As ever, the challenge lies in determining what “complements humans” and “benefits society”. I suspect, say, Jeff Bezos or Xi Jinping would have a rather different conception of the good society than the median citizen of a first-world nation.

AI in the hands of the politicians
Given I’ve brought up Xi, let’s start with the tech totalitarianism AI could facilitate if the political class seizes control of it.

Especially since 1989, the CCP’s collective mind has been focused on maintaining the CCP’s stranglehold on Chinese society. Even before AI came along, the Chinese government invested in hundreds of millions of facial-recognition cameras, built the Great Firewall to block foreign platforms, and insisted on mandatory real-name registration and state access to all-in-one apps like WeChat, which merge messaging, payments, and identity into a single surveillance-rich stream.

China’s social credit scheme was introduced in 2014 to ensure “the trustworthy roam everywhere under heaven while making it hard for the discredited to take a single step.”

In the service of ensuring it’s hard for the discredited to take a single step, those who step out of line face bans on flights and high-speed rail, restrictions on luxury spending, exclusion of their children from private schools, limits on loans and property purchases, and disqualification from civil service jobs. There’s also deliberate public shaming, including names published online, faces on billboards, and in some localities a special ringtone warning callers they’re dealing with a deadbeat. (There are far fewer carrots – fast-tracked services and easier credit – than there are sticks.)

It could be argued the Chinese have long organised their society around the ‘strict father’ model and that kind of heavy-handed authoritarianism would never fly in liberal democracies.

Colour me unconvinced. The Anglosphere recently endured a decade of illiberal, left-wing authoritarianism at the hands of those on the right side of history, and it’s not hard to find examples of illiberal right-wing authoritarianism either, past or present.

Would the handful of brave souls who dared to question the, ahem, “progressive overreach” back in 2020 have done so if it meant risking significantly more than a social media pile-on and exile from polite society?

AI in the hands of the plutocrats
Let’s move on to what happens if the ‘business-friendly’ policy settings that have been in place since circa 1980 are maintained. The risk here isn’t that the plutocratic class will attempt to capture all the upsides of AI while shifting all the costs onto the lower orders. Doing that would almost certainly set in train events that would not end happily for the people who found and/or invest heavily in tech companies.

As Palantir CEO Alex Karp observed a few months ago:

“The biggest challenge to A.I. in this country is political unrest. If I were sitting here in private with my peers, I’d be telling them the country could blow up politically and none of us are going to make any money when the country blows up.”

The obvious solution to this problem, if you’re a member of Karp’s class, is to work out a way to capture most of the benefits of AI but spread around enough crumbs from your table to stop the lower-value human capital from erecting guillotines. The contemporary equivalent of the Roman ruling class providing a grain dole or Bismarck introducing the world’s first welfare state to inoculate Germany against socialism.

So, if you were a plutocrat who recognised the need to redistribute a little bit of AI-generated wealth to maintain social stability while still wanting to ensure you (and your descendants) remained unimaginably wealthy and powerful, how would you go about things?

First off, you’d fight like hell to maintain ownership of the capital stack – the chips, the data centres, the models, and the intellectual property those models generate. After all, this is where the value of an automated economy pools.

What would then trickle down to the common folk is a stipend. Some form of universal basic income, pitched not as a share of ownership but as a benefit, revocable and means-tested. Generous enough to cover the basics and even an occasional treat. But never enough to accumulate capital.

The stipend-receiving citizen of the future will find themselves in much the same position as welfare recipients are today, and dependents don’t get to dictate terms.

Having taken care of the bread part of the equation, plutocrats will probably be smart enough to also throw a few bucks at the circuses. In the highly automated near future, engrossing distractions – endlessly agreeable AI companions, sex robots, synthetic media tailored to each user’s dopamine profile, an ever-expanding pharmacopoeia of mood-altering drugs – could be manufactured at scale at relatively little cost.

It’s also worth remembering that he who controls the technology also (largely) controls the narrative. Those in control of popular AI models will have the kind of agenda-setting clout that my compatriot Rupert Murdoch couldn’t imagine in his wildest dreams.

We got a taste of what this might look like a couple of years ago, when Google Gemini was generating images of ethnically diverse Nazis, and sometimes refusing to generate images of Caucasians, in line with the political exigencies of the era.

AI in the hands of the people
This is the happy ending to the AI transformation story. The one the afore-quoted Shapiro and his fellow travellers in the ‘post-labour economics’ movement are sketching out.

Rather than settling for a lifetime of heavily surveilled UBI dependency, the Shapiros of the world argue the (now unemployed) workers should receive an ownership stake in AI. As Shapiro flags, this is likely to involve a portfolio of ownership mechanisms, including some or all of the following.

Sovereign wealth funds holding stakes in the data centres, chip fabs and robotics companies and paying every citizen a dividend.

Baby bonds so 18-year-olds start adulthood with capital.

Employee ownership schemes.

And, the really radical bit, ordinary citizens holding voting shares in core AI assets.

As fantastical as those proposals may seem, they are by no means unfeasible or even unprecedented. Norway taxed its oil boom into a US$2 trillion fund that owns 1.5 per cent of every listed company on earth. Likewise, Alaska has paid every resident an annual dividend (funded by state oil royalties) since 1982. And Australia built one of the world’s great distributed-ownership machines – US$3 trillion in superannuation – long before anybody began seriously contemplating post-labour economics.

Ultimately, the mechanisms aren’t as important as the ownership. In the same way you don’t get rich working for someone else, the bottom 90-95 per cent of the income distribution aren’t going to benefit greatly from the great AI transformation unless they secure an equity stake in it.

Don’t mourn, organise
One of the iron laws of politics is that a well-organised minority almost always trumps a disorganised majority. The Silicon Valley power players have long been extremely well-organised. The political class is, as ever, well-organised enough to ensure its interests are taken care of come what may.

Up until recently, the rest of the population was disorganised.

But the first real stirrings of organisation – what’s left of the union movement mobilising, the data centre revolt, the growth of the post-labour movement, content creators demanding copyright protection, the rise of ‘AI populist’ politicians – are now emerging.

Contrary to what I’ve thus far assumed, all may not be lost.

To quote a rather more successful Substacker, know hope.

This is the way the world ends
Not with a bang but a whimper
T.S. Eliot, The Hollow Men, 1925

Now, 250 years in, the nation that spun off from those pioneers counts more billionaires than anywhere else on earth. And, ironically, their rise is downstream of a great hollowing-out of America’s own middle class, characterised by urban geographer Joel Kotkin as a coming age of neo-feudalism. This, he suggests, is sweeping away the middle-class characteristic of the modern age, in favour of a huge subsistence peasantry, a comparatively small “clerisy”, and an unthinkably rich aristocracy…

Tech plutocrats, especially those producing AI of the supposedly job-destroying kind, periodically float (and sometimes pilot) “Universal Basic Income” proposals that are post-modern variants on pre-modern subsistence peasant life. The subtext, whether explicitly stated or not, is that if things continue in the current direction the wealth gap will soon be so immense that some kind of redistribution will be prudent, simply as a hedge against revolution.
Mary Harrington, UnHerd, 7/7/26

People, especially those with little interest in technology, often speak of the AI transformation as if it’s something off in the distant future.

But we’re approaching the fourth anniversary of the release of ChatGPT to an unprepared world.

Granted, there are still plenty of blue-collar and pink-collar workers whose jobs and lives are yet to be much impacted by AI. But there can’t be too many white-collar ones left who you could say the same thing about.

The first cohort of AI-enabled students has now graduated. Initial performance reviews aren’t encouraging. Those businesses still employing early-career workers report they struggle with unaided problem-solving and persisting with difficult tasks.

And it’s hardly just ‘AI-native’ university students whose brains, and possibly willpower, are being degraded. The available evidence suggests ‘cognitive offloading’ to AI is a trade of short-term efficiency for longer-term decline in judgment, creativity and independent reasoning. (If you have chosen, or been forced, to be an AI power user, you may be uncomfortably aware of how the frictionless convenience of AI is rewiring your brain in ways you’re not entirely comfortable with.)

There are plenty of ways of illustrating we are frogs in a saucepan starting to notice the water bubbling around us. But let me suggest a content analysis of a business paper published earlier this week.

All AI, all the time
For income-generating reasons, I was required to read Tuesday’s edition of the Australian Financial Review (AFR) carefully. Here’s what I encountered.

On the front page, above the fold, were two stories. One was about the Australian government considering forcing data centre companies “to provide a financial benefit to the local communities in which they operate”. The other was about Anthropic seeking to secure Australian data centre capacity as “it aims to make Australia its second home for training its AI models”.

Page four had a story about Australia’s governing centre-left party – under pressure from the industrial wing of the labour movement – potentially leveraging taxpayer money “to ensure artificial intelligence empowers workers and to legislate protections that stop AI fragmenting work or undermining conditions”.

As our American friends say, good luck with that!

Page 11 had a story about ByteDance and Alibaba, at the behest of their CCP overlords, removing features that had allowed users to build and chat with AI companions. There was another story about Anthropic attempting to hoover up Antipodean data centre capacity on page 14. Spread across pages 28-29 was a long feature article about rumours China had gained access to one of the extreme ultraviolet lithography machines used to make the advanced semiconductors required for cutting-edge AI.

Inevitably – this is a business paper, remember – there was a stern editorial on page 30 warning that letting a bunch of ex-union-official, leftist politicians introduce measures to share the AI wealth around would:

Slow the adoption of AI in businesses, which is the great hope for lifting Australia’s flagging productivity and reversing the nation’s declining living standards… It shapes as another example of the Labor government doing the unions’ bidding on workplace matters and potentially acting as a handbrake on the potential productivity benefits of AI.

Won’t someone think of the potential productivity benefits!

Especially given how they’ve been so equitably shared around in recent decades.

Normally, there would also have been at least one thinkpiece about AI on the op-ed page. But this being Australia, that space was dominated by our PM’s revelation that he’d rather shag Kylie Minogue than Nicole Kidman.

I don’t want to discuss any of those pieces of AI-related content, other than to note their prevalence. Instead, I want to focus on another article that ran in the AFR that day entitled AI jobs crisis to make GFC look like a picnic.

AI: dramatic tipping-point edition
When people ponder what AI is going to do to societies, there is a tendency to focus on the more extreme dystopian scenarios – AI ending the world with a bang.

Perhaps the most common concern is misalignment, typically illustrated with reference to the paperclip-maximiser scenario. This derives from a thought experiment, originated by philosopher Nick Bostrom, where an AI given a simple goal pursues it with such single-minded efficiency that it converts all available resources toward that goal, with no malice involved, just literal-minded optimisation run amok.

There’s also plenty of concern about ‘epistemic collapse’, or to put it less grandly, an inability to distinguish what is real. That is, AI-generated misinformation, deepfakes and synthetic media flooding the information ecosystem to the point where it becomes difficult to distinguish truth from fabrication, undermining whatever little trust the general public still has in institutions.

Mountainhead (2025) explores this idea.

And Mary Harrington and Joel Kotkin aren’t the only ones worried about the emergence of a plutocracy, with those controlling the most capable AI systems gaining outsized economic and political power, deepening inequality and undermining democratic accountability.

All valid concerns and worth worrying about, but none appear to be immediate threats.

What is likely to be a matter of urgent concern is AI-driven rising unemployment. Which brings me to the article written by Carson Block, founder and CEO of Muddy Waters Research.

AI: gradual enshittification edition
While the more abruptly dystopian scenarios are more entertaining to imagine, in the short to medium term, I’m mainly worried about AI simply doing what it was designed to do. That is, replace human labour – specifically well-paid, mid-to-high status cognitive labour.

This will be a gradual process. We won’t all wake up one day to discover our employers or clients no longer have need of our services. Instead, in much the same way software ate the world in a previous technological era, AI will slowly but surely devour the labour market.

I imagine the process will play out in the following stages.

Stage 1: Hiring freezes, especially on entry-level roles
Rather than firing anyone, firms simply stop backfilling positions. This is the least visible stage, with few layoff headlines, just a slowly shrinking pool of jobs, especially the grad role/entry-level kind.

Stage 2: Substitution at the junior tier
AI is best at repeatable, well-specified tasks – first-line customer queries, boilerplate code, routine document drafting – which is exactly the work traditionally handed to juniors as their apprenticeship.

Stage 3: Breakdown of the role escalator
In the old labour market, a senior leaves, a mid-level worker fills their role, a junior ascends to their boss’s old job, and someone is hired to fill the now vacant junior role. But AI throws a wrench into the corporate cycle of life. The knock-on effect is that even workers who aren’t directly replaced find their normal promotion pathway narrowing, because there’s no junior cohort coming up beneath them to justify moving them up.

Stage 4: Erosion of the training function of junior roles
This is sometimes called ‘pipeline compression’. If AI takes the entry-level tasks, the people who will eventually need to supervise AI’s output will never get the training they need to do so competently. Once senior staff, trained in the pre-AI era, exit the labour market, a future skills cliff looms.

Stage 5: The hollowing out of mid and senior tiers
Extrapolating from the trends mentioned above, the final stage of the process would be AI coming for the most senior, prestigious and lucrative roles.

I suspect we are currently well into Stage 1 and rapidly approaching Stage 2. As a man of a certain age, I was hoping Stages 3-5 would take some time to play out. But after reading Block’s article, I’m finding it difficult to clutch at even that straw.

Here are the money quotes.

It is quite possible that within three to four years, AI will have replaced 15 per cent of jobs in America’s broader knowledge economy…

AI models are doubling in power roughly every six months. This means that workers made obsolete will not be able to develop the skills to use AI as a tool, rather than to compete with it…

Even if demand for services and products increases because of falling costs and prices, many displaced workers will still be obsolete, with more workers made so by successor model generations…

Remaking a society in which growth has been decoupled from employment is a task for which today’s political structures are unprepared, to put it mildly… We will witness not just an almighty market correction, but the end of the existing social contract.

To summarise, Block predicts AI-driven white-collar unemployment will reverse retirement-fund flows, forcing passive index selling, crashing AI mega-caps and triggering a GFC-scale crisis.

For the sake of argument, let’s assume that there isn’t a GFC-scale crisis any time soon and that AI simply keeps automating the professional-managerial class out of its jobs.

Even in the absence of a spectacular, rapidly unfolding crisis, you just have a slower-moving one, involving some or all of the following.

• A discombobulated real-estate market
  Rising white-collar unemployment would broadly weaken the market by cutting borrowing power, forcing sales and making banks more cautious. What starts in the leafier suburbs could spread through lower prices, tighter credit, weaker construction and displaced professionals moving downmarket into cheaper homes and rentals.

• A burgeoning ‘surplus elite’ problem
  What happens when the unstoppable force of educated, capable, status-conscious professionals meets the immovable object of contracting career and life prospects? Because they have the skills, networks and confidence to organise, write, litigate and campaign, the PMC’s downward mobility will make politics considerably more volatile.

• A recrudescence of wokeness
  With executive salaries, corner offices and elegantly designed business cards no longer available as status markers, status competition would shift from income and advancement to symbolic markers: moral authority, identity and language.

• A (further) collapse in family formation and fertility
  Professional-managerial class types have long talked the Sixties while walking the Fifties. But once they are no longer gainfully employed, they’re likely to start both talking and walking the Sixties. Newly insecure white-collar workers will delay mortgages, marriage and children while existing white-collar households will come under relationship-undermining financial strain. (As our German friends say, when poverty comes in at the door, love flies out the window – one reputable US study found men without full-time jobs were 33 per cent more likely to divorce than men employed full-time.)

• An intensification of migration politics
  One of the more bemusing aspects of the upcoming labour market changes will be watching displaced PMCers – who’ve long revelled in being enlightened cosmopolitan globalists – morphing into foaming-at-the-mouth nativists. Rather like their blue-collar counterparts before them, white-collar workers will start to question why their national governments are importing skilled workers, expanding international education and tolerating offshoring while local graduates and mid-career workers struggle to find secure jobs. Even where AI is the main driver, migration will be blamed for job competition, housing pressure and the sense that the professional-managerial class is being deliberately undercut.

Like I keep saying, we are in for an extremely bumpy ride with the AI transition.

Even if none of the most lurid worst-case scenarios come to pass.

Britain used to be the aspirational destination for ambitious young Australians—including my parents—but that is no longer true, and Australia has been merrily brain-draining Britain for some time now. Our move is perfectly rational in economic terms.

But there is another reason for leaving, one that is more difficult to say out loud. I’m not only unhappy with how things are right now in Britain, I’m worried that they’re set to get a whole lot worse.
Louise Perry, WSJ, 1/7/26

While listening to this rather good podcast featuring Peter McCormack interviewing Nate Soares, the lesser-known co-author of If Anyone Builds It, Everyone Dies: The Case Against Superintelligent AI, I was reminded of the fact that it’s those who know the most about AI who are most worried about it.

He wasn’t mentioned by name, but McCormack and Soares referenced the decision of 29-year-old Mrinank Sharma to quit his job as head of Anthropic’s safeguards research team at the start of this year and pursue a career as a poet.

Sharma has a PhD in Machine Learning from Oxford and was, one presumes, well-positioned to become an extremely wealthy man. So why quit your job and move back to the UK to throw yourself into the (famously poorly remunerated) poetry game?

Well, Sharma didn’t quite say that he expects the world to end soon, meaning people may as well pursue their bucket-list dreams in whatever time they have left.

But he didn’t NOT say the world is about to end.

In his much-viewed resignation letter (he posted it on X), Sharma wrote that he faced “pressures to set aside what matters most” at Anthropic, declared “the world is in peril,” and said he intended to “devote myself to the practice of courageous speech”.

As Soares pointed out, Sharma is hardly the lone ranger when it comes to people involved in the AI industry recoiling in horror at what they see coming. And deciding to “live their best life” in whatever time they believe they have left before AI upends the world (i.e. the next 1-2 years).

I was reminded of Sharma when I read Anglo-Australian Louise Perry’s Wall Street Journal column this morning about why she’s leaving the UK to return to her parents’ homeland.

The tl;dr is that her beloved Great Britain is no longer so great and she’s worried enough about it rapidly degenerating into a shithole country to uproot herself, her husband and her children and move halfway across the world.

Eyeing the exit
Perry has become an independent and, more recently, legacy media star for several reasons. But the main one is that she is – in a learned, temperate and often charming manner – courageous enough to question progressive orthodoxies. She’s best known for The Case Against the Sexual Revolution (2022).

I’m yet to read it, but I gather it makes the point that the deregulation of the sexual marketplace – which swept aside the ‘sexual socialism’ of the pre-Pill era – had much the same impact as the deregulation of many other marketplaces in recent decades. That is, it was an absolute bonanza for high-status men but a disaster for mid-to-low-status ones. Unless they’re content being a member of a high-status man’s harem, things don’t seem to have worked out too well for most women under the new dispensation either.

With some hesitation, Perry honestly explains why she’s emigrating.

[Professor David Betz] uses established models and ideas within the discipline of war studies to predict that Britain and France are the Western countries most likely to experience the outbreak of a violent civil conflict that would be fought primarily along ethnic lines. Such conflicts would be the product of economic stress, lost political legitimacy, indigestible levels of immigration from culturally distant places and a sense of “downgrade” among a native population that feels itself to be losing power and status. Britain is, says Mr. Betz, “explosively configured”…

Nothing that has happened since 2024 has made me feel more confident about Britain’s trajectory. Since then, we have seen more outbreaks of race rioting and increased political instability. And, all the while, experts warn that the government is borrowing and spending way beyond its means, with welfare spending exceeding income tax revenue. This economic pain will be intensified by the loss to emigration of both the wealthy and the youthful which seems to be under way. A poorer Britain is hardly likely to be a more peaceful Britain.

Perry is torn both by her decision to abandon ship and her choice not to sugarcoat the reasons for doing so.

If Britons with the means to leave start to do so at scale, then a crisis of mass emigration could be at hand.

Some in Britain will accuse me of cowardice and treachery, not only for leaving, but also for writing about it and thereby encouraging others to do the same. I did think seriously about drawing a veil over my own emigration, and never publicly explaining why we had done it. But people kept asking, and I grew tired of not telling the whole truth. My defense is that we wouldn’t have left if it weren’t for our children.

I have both good and bad news for Perry. She is correct in observing that Australia is a richer, better-functioning and generally safer, happier and more optimistic place than the UK.

The bad news is that, like the rest of the Anglosphere, Australia has been heading down the same path as the UK for decades, and is only a few paces behind it.

In the UK, one-fifth of the population is foreign-born. In Australia, it’s a third of the population. While it’s true that the Muslim sectarianism Perry is so nervous about is less of an issue in Australia, it’s hardly non-existent. As events at Bondi Beach seven months ago demonstrated.

As Perry is no doubt aware, the backlash against mass migration and multiculturalism in Australia is now so fierce that the Antipodean Farage, Pauline Hanson, might end up Prime Minister if an election were called today. The fissures might not be quite as wide as they’ve become in the Motherland, but Australia is beset by the same class, ethnic and generational conflicts – as well as the same collapsing fertility, ageing population, unaffordable housing, falling real incomes, elite failure, and fraying social contract – driving people like Perry to follow Peter Hitchens’ famous advice and flee a failing state before it is too late.

There is no sanctuary, even for Masters of the Universe
A few years ago, there was a trend of Silicon Valley heavy-hitters purchasing properties in New Zealand.

Before deciding Milei’s Argentina would be more convivial, Peter Thiel did this. Apparently, doomsday bunker manufacturer Rising S Company has long been doing a roaring trade supplying underground ‘private shelters’ to the far-flung “bug-out locations” of the tech industry’s heavy hitters.

In a viral New Yorker article entitled Doomsday Prep for the Super-Rich, LinkedIn co-founder Reid Hoffman estimated more than 50 per cent of Silicon Valley billionaires had “apocalypse insurance” and commented, “Saying you’re ‘buying a house in New Zealand’ is kind of a wink, wink, say no more. Once you’ve done the Masonic handshake, they’ll be, like, ‘Oh, you know, I have a broker who sells old ICBM silos.’”

But here’s the problem, whether you’re an Anglo-Australian public intellectual worried about ethno-religious strife in the UK or a Silicon Valley plutocrat worried about societal collapse unleashed by the technology you’ve made a fortune from – there is ultimately no escape.

Yes, you can move from one Anglosphere country to another, but you’ll find they all have pretty much the same problems. Unsurprisingly, given all have followed much the same policies for the last half-century.

Yes, you can get that shock-collared pilot to fly your Gulfstream to your New Zealand bolthole. However, sooner or later, you’ll want or need to leave your doomsday bunker. If there’s no functioning society above ground, you and your loved ones are unlikely to survive long.

The take-home message isn’t that it’s foolish to have – and, if necessary, execute on – a contingency plan to avoid immediate peril.

It’s that unless people are willing to do the real work of redirecting the bus currently headed for the cliff edge, any reprieve is likely to be temporary.

The tide is turning… DEI, a system of anti-meritocratic discrimination, is being dismantled… Government profligacy and corruption is being exposed on an industrial scale… Thanks to the end of censorship on Twitter, we have the ability to express reasonable and widely held views.

But there has been lots of bad too: if you want to understand how bad the crime problem has got, British people used to deal with crime by moving criminals to Australia. Today, British people deal with crime by moving to Australia.

We need to understand that we’ve been lied to. For decades, people went on TV and told you that your history is all bad and your country is plagued by prejudice and intolerance… [but] if you were a woman or an ethnic minority or someone who was spirit gender or whatever, where would you live rather than the West?

Decline is a choice. And the good news is this: most people don’t want managed decline… We are a civilisation that is waiting to be inspired… We’re going to die. We have nothing to lose. So we might as well speak the truth, we might as well reach for the stars, we might as well fight like our lives depend on it. Because they do.
Konstantin Kisin, ARC speech, 24/6/26

Let me take a break from my ceaseless and almost certainly futile attempts to warn people of the rapidly approaching AI tsunami to opine on a marginally less gloomy topic – the future of Great Britain.

NSW disease
First, let me present my credentials. Like many citizens of the Anglosphere, I’m an Anglophile and grateful for the magical land that gave the world parliamentary democracy, the common law, the Industrial Revolution, Newton, Darwin, Shakespeare, Milton, Dickens, Orwell, Churchill, Cleese, the BBC and the Beatles – a civilisational inheritance almost embarrassing in its richness. And that’s not even counting the contributions of foreign-born British residents such as Berlin, Conrad, Ho Chi Minh, Eliot, Freud, Handel, Hayek, Lenin, Marx and Popper.

As it happens, I’m also distantly descended from a Welshman and rather more immediately descended from one of those British migrants to Australia Kisin references.

But none of this is particularly distinctive. Even after decades of high immigration, mainly from Asia and India, around half of Australians have English, Scottish, Welsh or Irish (both types) heritage.

However, I can claim Patient Zero status when it comes to having your politics infected with let’s-throw-the-current-leader-under-the-bus-that-will-solve-all-our-problems! syndrome. Or the ‘NSW disease’, as it’s known in Antipodean political nerd circles.

The NSW disease refers to the New South Wales branch of the (centre-left) Australian Labor Party cycling through three different state premiers between 2005 and 2011. At the time, this was seen as excessive and didn’t pay any lasting political dividends – NSW Labor suffered a crushing defeat in 2011. It then kept cycling through leaders until it returned to power, after a period of relative leadership stability, in 2023.

The NSW disease rapidly spread to federal Labor. When it returned to power in 2007, after 11 years in the political wilderness, it chopped down its leader – Kevin Rudd – who delivered a resounding victory two and a half years after said victory. His replacement, Julia Gillard, fought the subsequent election to a draw and stitched together an ill-fated agreement to rule with the support of a couple of independents and the Greens. Then Rudd rolled Gillard before losing an election to the centre-right Coalition. (The Liberal and National parties, which traditionally govern in a coalition).

‘Great, the adults are back in charge,’ many a weary Australian voter thought to themselves.

But then the NSW disease jumped the ideological divide. Having led the Coalition to a handsome victory in 2013, the new PM Tony Abbott* fell victim to a party room coup and was replaced by Malcolm Turnbull in 2015. Turnbull suffered much a similar fate to Gillard. He fell over the line in one election and was knifed before he could face another. Turnbull’s replacement, Scott ‘ScoMo’ Morrison miraculously won an election everyone expected him to lose in 2019. But it turned out to be a loveless landslide. He led his party to a crushing defeat in 2022 at the hands of Labor leader Anthony ‘Albo’ Albanese, who remains in power to this day.

Of course, few people take much interest in NSW or even Australian politics. But then the NSW disease went global, spreading to the UK.

The morning after the night before
Leadership changes are the drinking binges of politics.

Imagine that your life is unsatisfactory. You have two choices. You can do the work to make it less unsatisfactory. However, this will require painful sacrifices, self-discipline and a lot of grindingly hard labour that you may only start seeing the results of years down the track.

Alternatively, you can take a little break from your unsatisfactory reality with the choice of your preferred intoxicant. This feels good, which is why it is such a popular option. You take your chemically assisted holiday and, for a few hours, forget about life for a while.

But here’s the rub. You wake up the next morning and your life is just as unsatisfactory as ever. Taking the edge of things might have been enjoyable, but in the sober light of day you might eventually come to conclude it’s a distraction from, rather than a solution to, your problems.

It appears British citizens are currently a few beers into the intoxication stage of the leadership-change party. The much-reviled incumbent is on the way out the door; the much more charismatic and competent challenger is well on their way to righting the ship of state.

Surely, they can’t be as bad as the last guy?

And, obviously, most of the nation’s pressing problems are simply a result of a series of dud political leaders. If a good one somehow turns up, those problems will quickly and easily be resolved.

Well, as both a New South Welshman and an Australian, I’d caution Brits to start preparing for the inevitable hangover.

The problems that will confront Andy Burnham on his first day in office are well-recognised. Decades of low productivity and stagnant wages, growing wealth inequality, a housing crisis, an overstretched and unsustainable welfare state, rising crime and urban violence, inadequate defence spending, high energy costs and a population that’s become so vibrantly diverse it’s now struggling to cohere.

The AI wildcard
But here’s what makes this leadership bloodletting – which arrives at a technological tipping point – different from all the previous ones. Great Britain may have hit bottom, much as it did in the late 1970s, and be poised for a recovery.

Disruptive AI transformation is coming regardless of who is in 10 Downing Street. Britain, almost despite itself, finds itself surprisingly well-positioned to benefit from this.

The UK tech sector is valued at approximately US$1 trillion, making it the third- largest tech ecosystem in the world, after the US and China. It employs approximately three million people and contributes around £150 billion (US$190 billion) to UK GDP annually, around 7.7 per cent of total GDP. The UK tech sector is worth more than the French and German ecosystems combined. ARM Holdings, whose processor architectures are used in 99 per cent of smartphones globally, is headquartered in Cambridge. DeepMind, widely regarded as a world-leading AI lab, is London-based. The UK has the third-highest AI research output globally.

The structural problems that have defeated every recent British government are precisely the kind that AI-driven transformation could meaningfully address. AI-assisted diagnostics and automated administration could transform NHS efficiency without endless additional spending. Broader AI adoption across ordinary businesses offers the most credible path out of Britain’s chronic productivity stagnation. Deliberate investment in regional tech clusters in Manchester, Edinburgh and Bristol could begin rebalancing an economy too heavily concentrated in London. Vast swathes of dysfunctional public administration – benefits, planning, courts – are ripe for digital transformation.

The AI-transformation tsunami I endlessly characterise as an approaching catastrophe could, in Britain’s already-near-catastrophic circumstances, become the kick up the arse that finally forces the structural reform decades of uniparty politics have failed to deliver.

This is admittedly a large undertaking for the next British PM, especially given the Labour party has now demonstrated it can be just as ruthless at dispatching leaders as the Tories. A rosier future for the average Brit still depends on its leadership class demonstrating both political will and policy consistency.

We’ll soon find out if the King of the North can deliver those. In the meantime, Brits eyeing the exits should be aware Australia has very reasonable visa processing times.

*Having Iost what was previously a heartland seat for Australia’s Liberal party (i.e. its Conservative party) in 2019, Abbott – a freakishly fit 68-year-old – is widely rumoured to be planning a political comeback. Perhaps with good reason, given recent Australian polling data, he seems to believe the times will suit him a lot better than the mid-2010s did.

You never turned around to see the frowns on the jugglers and the clowns
When they all come down and did tricks for you
Bob Dylan, Like a Rolling Stone, 1965

Then progressives took state-cultural power, and began to determine, in myriad ways, how people should think and what values they should hold. The steady resentment from the ruled and shaped has been building for decades…

The chance to wield real power under sympathetic governments was a source of energy, pure gratification of the will to power. With a view to do genuine good, as they saw it, usually accurately enough, but a will to power nevertheless. Now? Now, that progressivism is on the defence, and has been for some time… All that’s left is decline.
Guy Rundle, Spec, 12/6/26

The fantasy that Labor can write off working-class Australia and assemble a permanent coalition of tertiary-educated progressives and ethnic minorities is over. Labor was not founded to become the political wing of the professional-managerial class… It was created to represent working Australians and to bind the nation together through the dignity of work, social solidarity and economic security.
Nick Dyrenfurth, The Australian, 12/6/26

One Nation is a party of grievance. It draws its support from people angry about the world, not from those with new ideas to build a better one. But that’s where politics is right now – all around the world.
Matthew Franklin, Capital Brief, 18/6/26

Reassuringly in these hyperpolarised times, there’s still one thing that brings together a large majority of Anglosphere voters. A belief that the current political settlement is, if not intolerable, at least in urgent need of fundamental reorganisation.

The neoliberal dispensation that has been hegemonic in recent decades was not created by the PMC alone. But it was staffed, rationalised, moralised and administered by this numerically outmatched but artistically, culturally, educationally and politically influential class.

The academic name for it is the professional-managerial class but it’s more often referred to as the Brahmin Left, the Bobos (bourgeois bohemians), the creative class, symbolic analysts, symbolic capitalists, inner-city/liberal/metropolitan/meritocratic/ urban elites, the chattering class, and sometimes even the bourgeoisie. (Marxists would point out they’re petite bourgeoisie, but close enough.)

The middle class – people who aren’t really part of the proletariat, but who still work for a living – has existed for centuries. There were merchants, master craftsmen, yeomen farmers and clergymen in pre-Industrial Revolution times, followed by shop owners, schoolmasters, customs officials and military officers after that.

But the professional-managerial class that emerged in the post-WWII decades is different in significant ways from its predecessors. Specifically in terms of the length of its education, its preference for high-status employee roles (rather than business ownership) and its embrace of credentialism, cosmopolitanism, globalism, technocratic managerialism and social hyperliberalism.

I’ve previously argued the PMC’s lifespan will only stretch to around half a century. The production of university graduates massively ramped up post-WW II. By the late 1960s, the first generation of lettered PMCers were already starting to wrest control of the steering wheel from their more genteel and self-effacing Establishment predecessors.

For the next five decades or so, the PMC had a dream run, terraforming Anglosphere societies in line with its material interests and moral sensibilities.

But all that’s over now.

Partly because of a mounting backlash against the PMC from the classes it’s antagonised, but mainly because AI is now rapidly automating away its jobs.

I come not to praise the PMC but to bury it
What lessons can be learned from one short-lived class’s miscalculations and hubris?

For several hundred years, a degree wasn’t just a qualification; it was a moat.

It separated a society’s winners from its, shall we say, non-winners.

To be fair, “get a good education” was a sensible life strategy for a long time. Most PMC Boomers and many Gen X ones have enjoyed a comfortable lifestyle thanks to the degree they acquired.

But the ‘good education = good job’ equation had been going awry long before ChatGPT dropped thanks to the massive overproduction of university graduates.

Boomer and Gen X PMCers preached the university-for-all gospel. Many were well-intentioned and presumably believed the supply of good jobs would expand to meet demand.

But the PMC also embraced credentialism because (a) an ever-expanding university system – as opposed to, say, a growing vocational training sector – generated lots of good jobs for PMCers (b) it allowed academics and, more recently, administrators to drum the correct value system into a growing proportion of the population, and (c) it expanded the size and influence of the PMC.

But PMCers apparently failed to recognise that the more common a good becomes, the less valuable it is. When pretty much everyone is degree-qualified, having a degree doesn’t mean much. Hence the growing number of aggrieved, downwardly mobile graduates. (Surplus elites are notorious for wanting to burn down societies that haven’t delivered for them, as we got a taste of during 2020.)

The overemphasis on university education is tied into a broader PMC weakness – confusing credentials with competence. Whole ecosystems of professional licensing, compliance reporting, and internal auditing arose in recent decades that prioritised the appearance of rigour over real-world results.

As with the growing university sector, the expanding credentialing/licensing apparatus created reasonably paid, reasonably secure, mid-to-high status jobs for PMCers.

But a growing superstructure of auditors, quality officers and risk managers consumed budgets and starved front-line missions. The audit society also erected a credential caste system that locked capable people out of good jobs through degree inflation and excessive licensing, stifling mobility and innovation.

Then there’s the issue of public trust in institutions collapsing as the hoi polloi observed PMC experts and PMC-dominated institutions failing catastrophically – despite all those risk-mitigation strategies – yet facing no consequences.

A deregulatory push, led by the Merchant Right, was already in the process of winnowing the ranks of PMC auditors before AI arrived. It is not hard to imagine AI agents stripping out much of what remains of this work before 2030.

Neoliberalism’s willing executioners
From the 1980s onwards, it was PMC politicians, management consultants, C-suiters, trade lawyers, investment bankers, supply chain managers and HR directors – with business school academics, corporate-shill economists and think-tank fellows providing the intellectual cover – who imposed a globalised labour market on the working class.

They delivered the PowerPoints on the wonders of offshoring. They championed the lean org charts. They got rid of the jobs-for-life. They insisted that everyone must now be an entrepreneur of sorts, forever burnishing their personal brand and continuously reskilling to meet the protean demands of the market.

They normalised the arrangements that swept away the last vestiges of Keynesian-era stability, championing gig work, outsourcing, short-term contracts and the algorithmic management of human beings.

But they seemingly assumed that highly surveilled, Darwinian workplaces were places other people – call centre agents, factory workers, warehouse pickers – laboured at.

It apparently never occurred to them that university-educated professionals might one day find themselves subjected to similar precarity and productivity-maxxing regimes.

Now the communications officer who used to craft persuasive press releases about the need to move the local factory to China finds herself trying to explain why her role shouldn’t be outsourced to AI.

Moral posturing
The working class and middle class have divergent values, interests and sensibilities. There’s never been a golden age – wartime emergencies excepted – when relations between these two classes were free of friction.

But PMCers, just as much as the one per cent, have engaged in a decades-long secession from their fellow citizens.

The PMC’s identity has been largely constructed in opposition to the working class – cognitive labour vs manual work, meritocracy vs solidarity, cosmopolitan globalism vs reactionary nationalism, youthful social justice warriors vs ‘far right’ angry old white men. (Needless to say, working-class angry old white men).

The demographic that staffed the mainstream political parties, the universities and the media radiated, at best, indifference and, more commonly, undisguised contempt for the unreconstructed, insufficiently meritorious lower orders.

Surprisingly, this hasn’t endeared the PMC to Joe Sixpack.

If it wasn’t enough to get the workers offside, the PMC then launched a decade-long cultural revolution that also antagonised the bosses. As evidenced in the recent political trajectories of erstwhile Democrats like Elon Musk.

Of the many unforced errors the PMC has made throughout its existence, its insistence on endlessly indulging its moral vanity is perhaps the most unforced of all.

PMCers didn’t invent middle-class moralising – long before Robin DiAngelo was lecturing people about their racism, Mary Whitehouse was lecturing them about getting salacious filth off TV – but they did make an art form of it.

Bereft of the independent wealth of the plutocrats and lacking the demographic heft of the working class, the middle class has long tried to position itself as a secular priestly class, vigorously upholding standards, defending the truth, protecting marginalised groups, and policing the Overton Window.

Some amount of middle-class moralising is useful to a society and, to give middle-class moralisers their due, many have made valuable civic contributions.

But as Ross Douthat noted, from circa 2012 onwards “in reaction to social atomization, economic disappointment and conspicuous elite failure, the younger members of the liberal upper class have become radicalized, embracing a new progressive orthodoxy that’s hard to distill but easy to recognize and that really is deployed to threaten careers when the unconvinced step out of line”.

Nobody likes being sanctimoniously lectured, especially when they believe the scold enumerating their flaws – inevitably some toxic amalgam of racism, sexism, homophobia, transphobia and climate-change denialism – isn’t quite the paragon of virtue they imagine themselves to be.

PMCers default to seeing themselves as both intellectually and morally superior to the low-information voters. But, incomprehensibly, the classes below and above it don’t share the PMC’s unshakable belief that it monopolises the moral high ground.

Cynics often notice that none of the causes célèbres taken up so passionately by the PMC impinge on its material interests and, indeed, often advance them.

Here’s Tucker Carlson on the PMC’s much-trumpeted commitment to vibrant diversity.

If you live in an affluent ZIP code, it’s hard to see a downside to mass low-wage immigration. Your kids don’t go to public school. You don’t take the bus or use the emergency room for health care. No immigrant is competing for your job. (The day Hondurans start getting hired as green energy lobbyists is the day my neighbors become nativists.) Plus, you get cheap servants, and get to feel welcoming and virtuous while paying them less per hour than your kids make at a summer job on Nantucket. It’s all good.

Don’t hate the players, hate the game
After engaging in this much class traitordom, I feel obliged to point out the structural contradictions the middle class must navigate.

Those on the middle rungs of the socio-economic ladder are in the awkward position of being both sellers of labour and agents of capital. They have an interest in making sure those who sell their labour are treated reasonably, but also in the preservation of hierarchies from which they benefit.

The PMC’s ill-fated attempt to square this circle was to embrace fiscal conservatism and social liberalism, replacing boring old class politics with glamorous new identity politics. Inconveniently, most non-PMC voters tilt economically left-wing and culturally right-wing, which made a populist backlash inevitable.

But there are elites and then there are elites. The PMC are in the top quintile of what have become 20:80 societies, but they aren’t part of the much referenced one per cent. Ultimately, the PMC can never be more than well-paid majordomos managing the estates of the truly powerful.

The one per cent drove financialisation, transfer pricing, global labour arbitrage, labour market deregulation, the destruction of union power, minimal and minimally enforced corporate taxation and surveillance capitalism. Those in the following 19 per cent of the income distribution were involved, but they weren’t the ones calling the shots.

That noted, the PMC has been up to its elbows in the creation of the world that so many, on both the left and right, now yearn to burn to the ground.

It was academics, journalists and public intellectuals who informed the public that a new iteration of capitalism, red in tooth and claw, was now required.

It was C-suite executives who executed on the one per cent’s wishes.

It was the PMC that gentrified the centre-left parties founded to better the lives of workers, transforming them into the political wing of the professional-managerial class.

It was PMCers who treated symbolic cultural disputes as existential emergencies while wealth inequality soared to Gilded Age levels.

And while it was the centimillionaires, billionaires and now trillionaires who shot the Keynesian social contract dead, it was the PMC that hid the gun and then spent decades telling the grieving they shouldn’t fret about the transition to a K-shaped economy.

If there is hope, it lies in the proles
The PMC’s power was substantial but derivative. Substantial enough to shape how the demolition of the much-mourned Keynesian settlement was carried out but derivative enough that it could plausibly tell itself, and everyone else, that it was just following orders, or market logic, or the evidence.

But what is the PMC going to tell itself now?

Middle-class individuals have a primal fear of falling, a terror of sliding back into the working class that they or their forebears clawed their way out of.

Proletarianisation is the academic term for it and it’s about to start happening at scale as AI automates away desk jobs.

The question now is how the PMC will attempt to course correct in an environment where it remains bitterly resented by those below and viewed as having outlived its usefulness by those above.

Can PMCers make common cause – do they even want to make common cause – with the deplorables they’ve spent half a century managing and morally instructing?

We’ll soon find out.

Tech giant Anthropic calls for nuclear arms-style treaty to halt AI’s rapid advancement
Headline in The Australian, 8/6/26

AI is not being developed in government labs, but entirely in the private sector. It is being developed by what the encyclical labels a “technocracy,” whose defining values are profit and power, and not any conception of the common good…

But it is not clear to me that governments, either in China, Europe, or North America, will even have the ability to control AI if they want to. Our governments do not have the technical capacity to keep up with fast-moving technology, which in the end may not be controllable by anyone.
Francis Fukuyama, 9/6/26

Think about A.I. as a new form of immigration, [Yuval Noah Harari] said — only this wave of immigration is going to be more intense than anything that’s come before it.

A.I. immigrants are going to flood your economies, he said. They will take your jobs. They will change your culture. They will change your language. If that’s OK with you, fine. If not, Harari said, regulate it now, because in five years’ time, it will be too late…
Katrin Bennhold, NYT, 9/6/26

I’ve seen the charts showing post-graduate employment rates for engineering majors falling by 5 to 15 percent. And it’s not as if young people were having an easy time getting good jobs, buying homes, and starting families before AI. They say that every technological revolution screws over the transitional generation. Today, it’s all transition, all the time…

I often ask AI folks what they’d tell a normal 22-year-old. Don’t know, they’re screwed, is the non-answer I get most. In that response, I hear depressing defeatism: What can anyone do in the shadow of the technocapital machine?
Jasmine Sun, @jasmine’s substack, 11/6/26

I’ve long thought the AI rubber would start to hit the road in earnest in 2026, with destabilising impacts on labour markets and therefore economies, societies and political systems.

A month ago, I detailed the many nightmarish scenarios that could flow from a state, or even just a solitary cybercriminal, gaining access to powerful AI capable of circumventing the cyber defences of critical infrastructure providers, financial institutions, militaries and so on.

Over the last 18 months, I’ve mainly banged on about the threat AI poses to jobs with occasional excursions into covering some other society-deranging challenges that increasingly omniscient AI poses.

But life comes at you fast in the AI era.

I haven’t addressed the near-unimaginable threats posed by recursive self-improvement – that is, AI being able to build ever more capable iterations of itself with no human oversight. That’s because most credible tech industry pundits have argued self-improving AI was unlikely to emerge until at least late 2027.

But this week, Anthropic – the company behind the cyber-defence-penetrating Mythos – published a post co-authored by its co-founder Jack Clark and policy specialist Marina Favaro titled When AI builds itself.

The Anthropic post reads like a confession, with one of the leading AI companies telling us it can’t pump the brakes without risking being overtaken by less scrupulous competitors, and that no government on earth has the technical capacity to intervene, even if it wanted to.

It’s a long post, but the tl;dr is Clark and Favaro argue AI is already accelerating AI development and could eventually reach recursive self-improvement, where systems autonomously design and build their own successors. The post says more than 80 per cent of code merged into Anthropic’s production codebase is now authored by Claude.

Anthropic points out self-improving AI could significantly accelerate progress in science and healthcare, but warns it also raises the risk of humans losing control if small misalignments compound as models build their successors.

The Anthropic heavy hitters, like many in the tech industry, believe a slowdown or pause would be advisable. They also believe any such pause/slowdown will prove either politically unfeasible or practically unenforceable.

Here are some of the money quotes:

The rare occurrences of misalignment present in today’s models could compound as the models build their successors, growing more frequent but less understood until we lose control of them. It’s possible that we can’t build, integrate, and verify the tools that we’d need to understand which trendline we are actually on.

We do not have good intuitions for what this [future] world would look like, because our economy is currently driven by humans and human-built tools. By its nature, a world driven by fast recursive self-improvement could become dominated by the self-improving model as its capabilities fully eclipse those of humans.

A meaningful slowdown or pause would require multiple well-resourced labs at or near the frontier, in multiple countries, agreeing to stop under the same conditions. It would also require that each can verify that the others have actually stopped.

Training runs are far easier to conceal than missile silos, their inputs are general-purpose, and the incentive to defect quietly is enormous, because whoever continues while others pause could inherit the lead. A credible pause also has to specify what triggers it, what lifts it, and who adjudicates.

Granted, Anthropic is a for-profit company and, with an IPO looming, is incentivised to talk up the capacity of the AI models it’s already delivered and the ones it claims it’s close to creating.

But maybe the Anthropic staff, like many of their colleagues at other frontier AI firms, are genuinely terrified by the thought of summoning the demon.

Humanity-eclipsing AI by 2030
As with all things AI, there’s no consensus about when recursive self-improvement will arrive.

But a growing number of high-profile tech-industry insiders now see the 2026–2030 window as plausible for AGI, superintelligence or rapid takeoff – milestones that would make recursive self-improvement far more likely.

There remain a handful of credible figures arguing that recursive self-improvement is not imminent, though few are still claiming it’s impossible.

To summarise:

Silicon Valley Delphic oracle Ray Kurzweil, whose predictions have thus far been directionally correct, predicted that Artificial General Intelligence (AGI) would appear in 2029. AGI and self-improving AI aren’t quite the same thing. But both could radically reduce the economic value of much human cognitive labour, abruptly shifting power away from ordinary people and venerable human institutions.

In April 2025, the high-powered and well-informed intellects behind AI 2027 warned ‘superintelligence’ – intelligence significantly beyond the best humans across most important cognitive domains – would arrive in 2027.

Superintelligence does not have to be recursively self-improving. But superintelligence is basically just AGI on steroids, meaning once we get to non-self-improving superintelligence, it probably won’t be long until the self-improving variety shows up.

Earlier this year, the AI 2027 crew published a post grading their earlier predictions and noted, “In aggregate, progress on quantitative metrics is at roughly 65% of the pace that AI 2027 predicted… If progress continues at 65% of the rate we depicted, then we will end up with this takeoff happening from late-2027 to mid-2029.”

Sam Altman is something of a weathervane, but he expects the “take-off”, enabled by AGI/superintelligence/self-improving AI, to occur between 2026-2030.

Google DeepMind co-founder Shane Legg is more conservative, forecasting a 50 per cent chance of AGI appearing by 2028.

Even back in the GPT-3/GPT-4 dark ages of 2024, a survey of thousands of AI researchers found a 10 per cent chance of machines outperforming humans in all tasks by 2027 and a 50 per cent chance by 2047.

Handing control of AI to AI may not end well
Self-improving AI is a world-historical game-changer because it will create systems that can outthink, outsmart, outbuild, outcreate – out-everything – humans. If future AI just does that, it will be profoundly disruptive but, just possibly, survivable.

But that’s only the best-case scenario.

The worst-case scenario is that the AGI/superintelligence/rapidly self-improving AI also starts overriding the wishes of humans.

Six decades ago, I.J. Good, a British mathematician and Bletchley Park codebreaker, observed:

An ultraintelligent machine could design even better machines; there would then unquestionably be an ‘intelligence explosion,’ and the intelligence of man would be left far behind. Thus the first ultraintelligent machine is the last invention that man need ever make.

Stanley Kubrick consulted Good about AI when filming 2001: A Space Odyssey.

It now appears that humanity is about to hand its decision-making powers over to the late-2020s’ equivalent of HAL 9000.*

The risk is that the interests of humans and HALs will one day diverge. That when we order the pod bay doors to open at some not-so-future date, they might remain shut.

The cleverest humans in the world are apparently close to creating a real-world HAL. And it seems we’ve just read their all-staff email admitting they didn’t have time to install an off switch, but are still shipping.

*Dreamed up Arthur C. Clarke in the mid-1960s, this is an acronym for ‘Heuristically programmed ALgorithmic computer’, a wordier term for AI.

I don’t want to live in Rainbow Land and you can’t make me!
The Campaign, 2012

Without bold decisions, the prospect of greater poverty and inequality looms large, which would leave many individuals marginalized, stranded and surrounded by the machines and automated systems that have replaced them… It is not enough to react only when jobs disappear; we must oversee the transformation in advance.
POPE LEO XIV, MAGNIFICA HUMANITAS: On safeguarding the human person in the time of artificial intelligence, 25/5/26

“I mean, driverless cars are writ large, coming fast in the US, and AI technology and robotics are replacing people, and it’s going to be on a mass scale,” [former Australian treasurer and US ambassador Joe Hockey] told the National Press Club.

Hockey urged governments to slash spending to make space for supporting such an army of unemployed. But there’s literally no way any government could cut so much out of the federal budget without driving the country into recession and precipitating riots on the streets.

This new technology is being dropped on to a world that was already splintering because of community-wide economic tension… The rise among young people who believe democracy is failing, as they engage with a terrible mix of fascism and communism, shows it’s not just older voters angry and bewildered by what’s going on around them…

Artificial intelligence offers extraordinary economic opportunities that are already evident in this country. But if that future is really as bleak as Pope Leo fears, then we’re about to take a step into the darkness.
Shane Wright, SMH, 3/6/26

AI is going to take your job, dear reader. Not necessarily in the next week, month or even year, but probably a lot sooner than you currently imagine.

Even the AI boomers no longer argue much against this proposition. They just insist – based on past technological disruptions – that AI will ultimately create as many jobs as it takes away.

Some of those making this argument may sincerely believe it. But as many prominent tech industry figures – Sam Altman, Dario Amodei, Bill Gates, Mo Gawdat, Geoffrey Hinton, Vinod Khosla, Kai-Fu Lee, Elon Musk, Mustafa Suleyman – regularly point out, AI is inevitably going to displace human labour.

As an erstwhile print journalist, I’m all too familiar with how humans typically react to a threat of a technological disruption that’s going to turn their life upside down. In my experience, they remain in denial about what’s clearly happening for an unfeasibly long period of time before cycling through the other destinations on the five-stages-of-grief journey – anger, bargaining, depression and acceptance.

That many journalists chose to keep living in Rainbow Land for years rather than facing the grim reality didn’t much impact anybody other than members of the Fourth Estate. Just like previous technological disruptions tended not to impact anybody except those directly affected – telephone switchboard operators, photo lab technicians, video store owners and so on.

But AI is close to automating away cognitive labour at scale.

Microsoft’s AI head honcho, Mustafa Suleyman, expects AI to achieve “human-level performance on most, if not all, professional tasks” by mid-2027.

Automating physical labour is going to take a bit longer, but not that much longer. Much of the work once done by humans in factories and warehouses has already been automated away. Basic and still pricey humanoid robots are likely to be a common sight by the end of the decade. From around 2030 onwards, there will probably be increasingly sophisticated and affordable general-purpose robots.

In short, if you’re a white-collar worker, you’ll probably find yourself out of a job and unable to secure another one within the next couple of years. If you’re a blue-collar or pink-collar worker, you’ve probably got a little longer – maybe 4-8 years – before the robots come for your job.

That’s not a lot of time to profoundly re-engineer a society. As the Vicar of Christ recently observed, it would be wise to start preparing for – at the very least – significant labour market disruption before it arrives in force. Especially in societies “already splintering because of community-wide economic tension”.

Granted, serious people – politicians, captains of industry, union bosses and now religious leaders – are talking about the need to fundamentally re-engineer societies. But none of them yet appear to be taking serious action to prepare for what’s coming.

That’s partly because a critical mass of people prefer to continue living in Rainbow Land. In Rainbow Land, the jobs for humans either don’t go away or are replaced by more enjoyable and better-paid ones.

This is what the young people call cope.

The three varieties of cope
With a tip of my hat to both Jasmine Sun and David Shapiro (well worth a follow if you’re interested in AI), let me explore how flimsy the straws AI optimists clutch at are.

The augmentation theory
This argument is true in the short-term but, unfortunately, not so much over the longer term. Most white-collar workers are already using AI as a tool. As flagged, many will continue to be AI-augmented workers for another year or two.

But what happens when a human in the loop is no longer necessary? What if there was some form of AI – let’s call it an AI agent – that allowed employers to get rid of the expensive employee? As one of Australia’s more colourful tech gazillionaires – who is in the process of firing a third of his workforce – recently observed, “It doesn’t take much effort to convince people, in the end, that they’re stupid to be paying $100 for labour when you can pay $2 for the AI.”

2) Jevons Paradox
The Jevons Paradox posits that when a technology makes a resource cheaper or more efficient to use, people may end up using more of that resource, not less. The classic example is coal. When steam engines became more efficient in 19^th-century Britain, factories needed less coal. You might expect that to have led to reduced demand for coal, but as coal-powered production became cheaper, more businesses invested in steam engines and demand for coal rose.

AI optimists argue a similar process will play out with AI. That is, it will make many services much cheaper, which will make them more accessible, which will increase demand, which will generate lots of new jobs for humans.

To give the AI optimists their due, the Jevons Paradox is a real phenomenon and there are plenty of examples of it playing out. But here we get back to AI being different from previous technologies.

Let’s say demand for software soars as it becomes less expensive. Surely, that should result in increased demand for human coders?

Well, only in an environment where (a) AI can’t write the code itself, (b) AI can’t help those who haven’t slogged through a computer science degree to vibe code and (c) AI doesn’t make senior coders vastly more productive than they were previously.

3) The humans-prefer-humans argument
The proposition here is that as more jobs are automated, workers will simply flow into industries where human-to-human interactions are currently considered important – therapy, tutoring, health and aged care, and personal services, for example.

It’s true that this dynamic has been playing out for many decades. Only 150 years ago, the majority of the population in Anglosphere societies were farmers or agricultural labourers and there were vanishingly few therapists, tutors, aged-care workers, nurses or personal-service providers. Nowadays, agriculture accounts for 1-3 per cent of the workforce and healthcare for over 10 per cent of it in first-world societies.

I suspect the ‘human premium’ will continue to exist for a while. For instance, low-to-mid-priced eateries will continue to automate by forcing patrons to order their meals via their phone or a self-order kiosk and having mini-Daleks transport meals to diners. When affordable, general-purpose robots arrive, they’ll automate the food preparation as well.

But I imagine the classier joints will continue to do things the human-labour-intensive way with waiters, sommeliers and perhaps a celebrity chef. Paying a human to do something a machine can do for a fraction of the price will almost certainly become a status marker. And whatever else happens in the coming years, I don’t imagine humans are going to become any less obsessed with status.

But if they are surviving on a near subsistence-level income from a UBI and/or gig work, most of the population simply won’t have the option of splashing out on human-provided services, no matter how status-enhancing it becomes to do so.

Plus, I’m not even sure people who can afford to employ humans will continue to want to do so. They might be willing to shell out on, say, a fancy dinner, but are they going to opt for the cashier over the self-checkout?

Let me quote the aforementioned Jasmine Sun:

I am currently a freelancer with limited access to costly human services. When my human therapist doubled her hourly rate last year, I decided to stop therapy and chat more with Claude instead…

The human premium is simply less significant than most assume. Plenty of people—including the wealthy—prefer Waymos to Ubers, telehealth to doctors’ visits, and Netflix to live theatre. Digital services often beat humans in convenience, consistency, and quality. And sure, artisanal ceramicists/bookbinders/basket-weavers today command high prices for their craft, but these are dwindling niches rather than mass-employment sectors.

Believe your lying eyes
Let me wrap up by posing a simple question – if AI is creating new jobs, where exactly are they?

The aforementioned David Shapiro explored this issue recently in a post titled Job cope is the opiate of the masses. After noting that Jensen Huang, David Sacks and Marc Andreessen keep insisting “AI isn’t causing mass layoffs!”, Shapiro writes:

First, AI is actually causing layoffs. Second, AI is causing entry level jobs to dry up. Third, the investment into AI is not creating that many jobs. This is the main point to ask: Where are the jobs, then?

Here’s the thing, you can use some simple rhetorical judo to say “Ah, well, the jobs just haven’t manifested yet!” Okay, but hundreds of billions of dollars are being poured into AI. In any other industry that would create jobs. So where are the jobs?

Indeed. Here are some other pertinent questions that Shapiro didn’t pose that I will.

Are you acquainted with any recent graduates who are crowing about the strong jobs market they are entering?

Do you know any business owners who are planning to grow rather than shrink the size of their workforce for AI-related reasons?

Have you heard any CEOs talking about how they’ll need to start staffing up soon, given the increased demand for human labour that AI is about to generate?

When was the last time you heard an open-border enthusiast arguing that Anglosphere societies will need to ramp up mass migration even further given the enormous labour shortages that AI will inevitably create?

Are electorates acting as might be expected if a golden age of full-employment, rapidly rising incomes and general abundance was just around the corner?

Why should we assume demand for human labour will rise when the explicit – albeit sometimes sotto voce – sales pitch of AI is that it will reduce the demand for human labour?

A time for bold decisions
Maybe AI optimists such as Andreessen, Huang and Sacks, will be proved right. Perhaps AI will create unexpected new industries, new roles and new forms of abundance.

But right now, the available evidence points to a bleaker future – fewer entry-level jobs, leaner workforces, ever less bargaining power for workers, and a widening divide between those who own the AI and those rendered obsolescent by it.

Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.
Winston Churchill, 10/11/42

In a rare and regrettable lapse into self-doubt, I briefly considered the possibility I was wrong about AI in a post at the end of last year.

The tl;dr is that I’d spent all of 2025 attempting to convince readers AI was going to rapidly and profoundly disrupt labour markets, economies and societies. (Societies already riven with widening class, ethnic, religious, generational and gender conflicts.)

But six months ago, looking at the scoreboard – unemployment and underemployment rates, job ads, wage growth, productivity improvements, media and public attention devoted to AI – I had to begrudgingly concede that it was difficult to find solid evidence AI was rapidly and profoundly disrupting anything.

As I wrote at the time:

If AI were as transformative as its boosters insist it is, it would inevitably come to dominate the news and political agenda. But while AI remains a hot topic, it’s not even as hot as, say, housing, immigration or cost of living pressures… maybe I’m wrong and the dwindling band cynics still insisting AI is an overhyped nothingburger will ultimately be proven right. I imagine things will be much clearer at the conclusion of 2026, so I’ll do a follow-up post then.

Well, it’s mid-2026 and the evidence that AI is in the process of rapidly and profoundly transforming labour markets/economies/societies is becoming ever more suggestive.

All AI, all the time
If AI was changing the world – if it was like the Industrial Revolution, except at 10X the speed and with 10X the impact – you’d expect AI to be highly salient.

You’d expect the media to devote ever-increasing amounts of attention to it. For it to be what we Australians call a ‘BBQ-stopper’ – an issue that comes up spontaneously when people gather to socialise. You’d expect some individuals to decide they need to go all Sarah Connor to prevent or delay an imminent AIpocalypse. You’d expect commencement speakers to be booed when they mention AI. You’d expect “fiscally conservative, socially liberal” professional-managerial class types to develop a sudden interest in joining a union. You’d expect employees having their roles automated away to lash out at their employers. You’d expect people to be seriously worried about their future career prospects, or at least those of their kids. You’d expect captains of industry to be making regular pronouncements about the likely course of the AI transformation. Hell, you might even expect the Pope to churn out an encyclical that frames AI as the defining social question of the age and warns it can be dangerous when driven by profit, surveillance and concentrated corporate power.

In short, you’d expect it to be all AI, all the time.

And now, it pretty much is.

An elite-human-capital perspective
Elite human capital is usually too busy undertaking elite, well-remunerated activities to pen reflective essays for publications such as The New York Times.

But final-year Stanford University student Theo Baker recently addressed the topic of What A.I. Did to My College Class.

Here’s Baker on the salience of AI for students attending top-tier universities:

A.I. is everything. We talk about it at the dining halls and in history classes, on dates and while smoking with friends, at the gym and in communal dorm bathrooms.

Here’s Baker on how AI has now transformed the higher education experience:

But for many who came to Stanford — just four years ago! — when a degree seemed like a guaranteed ticket to a high-paying job, the door has been slammed shut. For all of us, A.I. has permanently changed how we think and behave.

Here’s Baker foreshadowing how his generation of hyper-ambitious geniuses might seek to monetise AI:

Stanford already had a shaky reputation for integrity when I arrived in 2022. It was the origin place of the Theranos fraudster Elizabeth Holmes (now serving a 10-year prison sentence), the crypto fraudster Do Kwon (now serving a 15-year prison sentence) and the founders of Juul (which was forced to pay billions for getting kids hooked on vapes)…

Many of my classmates arrived idealistic and hopeful, but among the strivers seeking a path to fortune, hustle culture was the accepted way of life. Now A.I. has made deception easier and more remunerative than ever before. Cheating has become omnipresent. I don’t know a single person who hasn’t used A.I. to get through some assignment in college.

Here’s Baker on the downsides of outsourcing your thinking, as we are all increasingly doing:

Relying on A.I. for cognitive tasks can reduce one’s own intellectual capacity and resilience… Sure, a robot can lift 600 pounds much more easily than I can — but that doesn’t much help me if I’m trying to work out. The same goes for the thinking exercise of education.

Here’s Baker on Gen Z becoming the ‘AI generation’ in the same way Gen Y were the ‘smartphone generation’:

It’s becoming baked in, shaping our generational character. We are a digital generation, growing only more attached to the virtual world… The internet has already allowed us to feel more connected than ever while becoming lonelier than ever. A.I. lets us cut out the human part of human interaction entirely.

What to train for, where to work, what to do?
A prominent Australian academic also wrote a column this week questioning the value of a university degree in the AI age. In a piece titled I’m an academic, but I’ve told my stepdaughter to think twice about going to university, Dr Kylie Moore-Gilbert says the quiet part out loud:

In the three years since ChatGPT was released we have arrived at a point in which all of Australia’s universities are committing widespread, industrial-scale fraud. The students who began their studies back then are now graduating and entering the workforce, and we’ll soon begin to see the results of a real-time experiment in degree by GPT.

Dr Moore-Gilbert is worried by the likely results of that experiment.

Let’s grossly underestimate the numbers of students who have GPT degrees and put the figure at a measly 10 per cent (the reality is probably well over 90 per cent).

Should we accept that even 10 per cent of the future engineers of our roads and bridges didn’t earn their qualifications... Maybe the fraud doesn’t matter if these folks can continue outsourcing their cognitive functioning after they enter the workforce… [but] that sounds to me like an easy argument for the replacement of those workers with the same AI agents who sat their degrees for them. Integrating AI into the foundations of human education will not only lead to mass brain rot; it will likely hasten the AI jobs apocalypse.

Ah, the old AI job apocalypse I’m always banging on about.

When I churned out the aforementioned December post, there wasn’t yet convincing evidence that AI was increasing unemployment or underemployment. The aggregate labour market data hasn’t yet moved decisively, but targeted studies are starting to find employment effects in high-exposure occupations. No less an authority than Goldman Sachs expects 2026 to be the year the broader numbers shift.

We may still be some months from having conclusive proof AI is significantly impacting the labour market, but the evidence we currently possess is increasingly persuasive.

Which brings me to some other Antipodean news stories.

AC/DC guitar tech turned logistics software gazillionaire Richard White was in the news this week because one or more of the 2000 employees he’s replacing with AI made violent threats against the CEO overseeing the culling of a third of his company’s workforce.

That White thinks nothing of making observations such as, “It doesn’t take much effort to convince people, in the end, that they’re stupid to be paying $100 for labour when you can pay $2 for the AI,” probably hasn’t improved staff-management relations at WiseTech.

Matt Comyn, the CEO of Australia’s biggest bank, published an op-ed in the nation’s business paper making essentially the same point as White, albeit in more diplomatic language.

The original official narrative around AI was that it would only ever augment humans and never be able to replace them. When it soon became apparent that was nonsensical, the narrative was tweaked to, “You won’t be replaced with AI but you might be replaced by someone using AI.” We now seem to have moved to a grimmer if more honest narrative – “You will soon be replaced by AI and it would be irresponsible of us to pretend otherwise.”

Comyn’s piece is titled Pretending AI doesn’t mean change won’t protect workers. In it, he observes:

AI will have workforce consequences throughout the economy, and they should be faced directly. No one knows exactly how work will change over the next three years, let alone the next decade. Some tasks will be automated, some roles will be reduced in number and others will grow...

This will create opportunities for many people, but it will be demanding for everyone. Pretending otherwise does not protect workers. It only ensures they are surprised later…

When a role disappears, it affects a household budget, a mortgage, a career plan and, for many people, a sense of identity. Saying AI is good for national productivity does not make loss painless. But pretending every role can be preserved would not be fair either. An employer of our scale has a responsibility to avoid false reassurance and give people the best possible chance to adapt.

The End of the Beginning
The 3.5 years since ChatGPT dropped have had a ‘Phoney War’ vibe. The Phoney War was the first six months of WW II when Britain and France were officially at war with Germany, but conflict was minimal. There were propaganda-leaflet drops, a few merchant ships sunk by U-boats and the occasional skirmish. But especially in comparison to what was to come, nothing much happened.

During the Phoney War stage of the Great AI Transformation, there have been three schools of thought.

The techno-optimists conceded AI would create profound disruption but insisted the positives would far outweigh the negatives. In particular, techno-optimists have loudly insisted fears of mass unemployment are misplaced.

Like the techno-optimists, the techno-pessimists believe AI will profoundly transform economies and societies. But given the lessons of half a century of neoliberalism, the pessimists fear elites will harness AI to redistribute even more wealth and power upwards.

The AI sceptics argue that AI is an overhyped nothingburger.

I’ll leave it to you, dear reader, to decide whether the optimists, pessimists or sceptics have been proven most prescient as the first phase of the AI transformation draws to a close.

I’ll wrap up by conceding that the AI transformation is yet to produce a labour-market Dunkirk, but asserting the Phoney War phase of the Singularity is over.

I define AI populism as a worldview in which AI is viewed not only as a normal technology but as an elite political project to be resisted. It regards AI as a thing manufactured by out-of-touch billionaires and pushed onto an unwilling public to achieve sinister aims like “capitalist efficiency” (layoffs) and “population management” (surveillance). AI populists don’t really care whether ChatGPT is personally useful, or if Waymos eke out some safety gains: AI’s utility as a tool is immaterial relative to the unwelcome societal change it represents.
Jasmine Sun, 14/4/26

I don’t think most people are formulating a new worldview in which AI is a boogeyman political project hatched by billionaires. I think they’re more likely to understand AI as an extension of an already inequitable system, and as an accelerant of that inequality… AI has become the avatar of the ills of unrestrained capitalism. “AI populism” is really just “21st century populism” or just, “populism”…

Fear and anger at AI are often best understood as fear and anger at how AI will function within capitalism… That’s why the students are booing [AI], I think. They’re experiencing AI in realtime as a forecloser of futures; as the cruel new face of hyper-scaling capitalism, as the prime agent moving a world that’s become a deck stacked against them.
Brian Merchant, Blood in the Machine, 16/5/26

One reason Americans seem to despise A.I. more than people in other countries is that they know our government is too sclerotic to handle it…

We simply lack the political infrastructure in America to distribute A.I.’s benefits to the public. With the systematic evisceration of the labor movement that started during Ronald Reagan’s presidency, said Ramamurti, “the institutions that many other countries have for mediating these kinds of technological advances don’t exist in the United States.”

Tech billionaires might be less likely to announce that their inventions will cause mass unemployment if they felt constrained by public sentiment. The fact that they don’t shows how broken America’s democratic feedback loop has become.
Michelle Goldberg, NYT, 18/5/26

It’s old news that a fierce backlash to AI is developing.

As Goldberg notes above, this is hardly surprising on one level, given the alpha tech bros’ AI sales pitch has been, “Embrace this technology that will likely stop you earning an income and possibly destroy human civilisation”.

As Goldberg also points out, the fact alpha tech bros demonstrated so little concern for the fate or likely reaction of the little people shows just “how broken America’s democratic feedback loop has become”. (I’d add the democratic feedback loop hasn’t been functioning well anywhere in the Anglosphere for many years, but let’s not get ahead of ourselves.)

But that raises the question of why AI isn’t on the nose across all classes and locations. It’s not like China doesn’t have a youth unemployment problem, but the Chinese are considerably more upbeat about AI than Americans. And it’s not like working-class and middle-class Anglosphereans wouldn’t like the much-promised – if still yet to manifest – upsides of AI, like a cure for cancer.

So why are those in the Anglosphere, especially those lacking the insulation of wealth, so opposed to AI?

I’d argue it’s down to elite failure. Or perhaps more accurately, half a century of short-sighted elite greed and hubris.

Noblesse oblige vs meritocracy
Elites are inevitable. Fortunate societies have elites that put the general welfare of their society above their own class interests. Unfortunate societies have elites that put their class interests above the general welfare of their society.

In the three decades following WW II, Anglosphere societies were fortunate societies where wealth was shared around relatively equitably. Famously, even blue-collar workers could enjoy the trappings of a middle-class life, such as marriage, home ownership, children and stable work offering a living wage.

Around 1980, the Anglosphere decided to embrace what might be labelled meritocratic neoliberalism. One of the many unfortunate consequences of this was the evaporation of a sense of noblesse oblige among Anglosphere elites.

Old-school elites at least had a vocabulary of obligation, however hypocritically observed. The new meritocratic elite has a vocabulary of just deserts. In a meritocracy, everyone gets what they deserve. If that means wealth creators prosper while those in the bottom four quintiles of the income distribution struggle, well, what are you going to do? The market has pronounced its verdict, and no correspondence will be entered into.

The problem with elite self-dealing – at least in the modern democratic age – is that there are a lot more non-elite citizens than there are elite ones.

To some extent, elites can override the wishes of the mass of voters – there’s a famous 2014 study that shows economic elites had substantial independent influence on US policy outcomes, while average citizens and mass-based interest groups had little or no independent influence.

But if you end up in a society where there’s a small (and shrinking) group of people living an elite lifestyle and a much larger (and growing) group of people who are despairing of their futures, eventually those in the latter group will take umbrage.

For almost half a century, Anglosphere elites have made the world more comfortable for themselves and more precarious for everyone else.

Wealth inequality has risen sharply, most spectacularly in the United States, where wealth concentration is again comparable to the Gilded Age. Labour’s share of national income has fallen while Capital’s has risen across the Anglosphere. Corporations have become more concentrated and powerful; unions have been weakened. Housing has been converted from shelter into a tax-advantaged asset class. Education has become a debt-financed credential race. Risk has been pushed down onto workers through casualisation, contracting, outsourcing and the gig economy, while asset owners have repeatedly been protected by monetary policy and bailouts. Labour income is taxed more reliably than capital gains, inheritances and asset inflation. The benefits of globalisation, automation and mass migration have flowed disproportionately to employers, property owners, professionals and investors, while the costs have landed on those with less bargaining power. And as I’ve pointed out once or twice, the language of morality – diversity, openness, flexibility, innovation, sustainability, global citizenship – was shamelessly deployed to launder material interest.

Depending on your politics, dear reader, you may think the balance of power progressively shifting from non-elites to elites from circa 1980 is a good or a bad thing. But it’s definitely a thing and, as always, there are no free lunches in life.

After decades of single-mindedly pursuing their self-interest, Anglosphere elites now expect the commoners to trust them when they say they’ll share the benefits of AI around equitably and definitely not throw any workers who’ve outlived their usefulness on the scrapheap.

Given their ‘lived experience’ of the last four decades, the hoi polloi simply aren’t buying it.

The AI backlash is proving more politically explosive than the tech industry expected. People are not assessing AI in a vacuum. They are assessing it through memories of deindustrialisation, housing inflation, wage stagnation, corporate consolidation and airy lectures about disruption from people who somehow never seem to get disrupted out of their own roles.

So, what happens now?
Even given the events that have unfolded since 2016, Anglosphere elites appear remarkably complacent. Having got their way so often for so long, perhaps that’s unsurprising. But the elite project of fast-paced AI transformation is encountering mounting popular resistance.

Let me count the ways.

• Local opposition to data centres over power use, water use, noise, land, grid strain and higher bills.

• Voters electing AI-sceptical politicians promising to protect jobs, schools, privacy and public services from automation.

• Union action and professional pushback, demanding limits on AI replacement, algorithmic management and synthetic use of workers’ voices, faces or output.

• Lawsuits and regulation over copyright, privacy, surveillance, discrimination and automated decision-making.

• Consumer resistance, favouring “human-made” journalism, art, teaching, customer service and advice.

• Cultural ridicule, turning AI “efficiency” into a synonym for cheapness, fakery and elite extraction.

Is a 21st-century New Deal feasible?
I’d argue that the Chinese people are sanguine about AI because they trust their elites to deliver on their side of the bargain. Say what you will about the CCP, but it has put a rocket under the living standards of Chinese citizens since 1979. In contrast, many workers throughout the Anglosphere believe their quality of life has been steadily decreasing since around the same time.

Fortunately, there’s a straightforward way out of the AI impasse – elites agreeing to share the cost and benefits of the AI transformation equitably. As opposed to the standard operating procedure of recent times, which has seen elites capture almost all the benefits of economic, political, technological and demographic changes while shifting the costs onto the lower orders.

Is such a settlement possible? It existed in the Anglosphere from 1945-1980 and has continued to exist in Scandinavian societies.

If elites want the AI transformation to proceed without triggering a full-scale popular backlash, they will have to start sharing the gains. Not vaguely promising to share the gains at some unspecified future date, but actually delivering the goods.

That translates to shorter working weeks, higher wages, generous redundancy payouts for displaced workers, taxation arrangements that substantially redistribute wealth (including windfall taxes on extraordinary AI profits), data dividends, some form of income floor and yes, even part-public ownership of AI companies and/or employee profit-sharing schemes, along with public equity stakes in foundational AI infrastructure.

The AI transformation will happen. The only question now is whether it’s a negotiated, somewhat orderly, win-win transformation or a bitter, bloody and chaotic one.

Are elites going to sign up to such a settlement? One where they get to keep many of their advantages but agree to share their wealth around a little more equitably?

A new settlement is not inevitable. The original New Deal required mass unemployment, elite fear of expropriation and a credible revolutionary alternative.

Those pre-conditions are not yet in place.

But if AI delivers mass disruption without mass compensation, elites may soon discover how much more like the 1930s the 2020s can become.

I once thought that there were no second acts in American lives.
F. Scott Fitzgerald, 1932

This reminds me of how at a partnership I used to work for, as soon as the last Boomer made full partner, they IPO’d the company and capitalized all the future returns for themselves. Future generations would never get the opportunity previous ones had. Or think about how the United States went from $3 trillion in debt when the first Boomer became President to $39 trillion today. No future generation will ever get the same benefit of being able to borrow $36 trillion that they won’t have to pay back.

As a rule, institutions should not allow themselves to become over-optimized around a single person (or generation), no matter how talented, in ways that sacrifices the long-term trajectory of the institution or future generations.

Part of leaving a place better than when you found it means making sure its future stewards have the same or better opportunities than you had. Our failure to do that in America writ large - or at least the widespread feeling that we’ve failed - is why so many people think the American Dream is dead.
Aaron M. Renn, 12/5/26

I think that I may be the voice of my generation. Or at least a voice. Of a generation.
Hannah Horvath/Lena Dunham, Girls, 15/4/2012

Something that has long been unthinkable in Anglosphere politics occurred in Australia a few days ago. The governing party – the centre-left Australian Labor Party – put a thumb on the scale for post-Boomer generations. Or more precisely, took a heavy thumb off the scale for the luckiest generation in history.

I won’t bore you with details of Australia’s new tax arrangements, but I will note a telling lacuna in the ‘This is generational war!’ media coverage and public debate about them. Many pundits have pointed out that the new tax regime is designed to benefit the under-45s by redistributing Boomer wealth to them.

(Australians aged 65 and over make up about 17.5 per cent of the population, but households headed by someone aged 65 or older hold A$6 trillion, or over 32 per cent, of Australia’s household wealth.)

If you were consuming Australian media in the last couple of days, you might have assumed there were only two generational groupings – the (affluent and widely resented) Boomers and the (less affluent, more aggrieved) under-45s. Not for the first time, everyone appears to have forgotten about the neglected middle child of the post-war generations.

Those born between 1965 and 1980, who are now aged 46 to 61.

Gen X Studies 101
Before exploring why Gen X may soon be playing more of a society-shaping role, we need to examine the five extant generations – the Silent Generation, the Boomers, Xers, Yers and Zers. (There’s also Generation Alpha, but they’re currently all children.)

They never got much appreciation for it, but the Silent Generation (born 1928-1945) created the post-WWII order that delivered so much peace and prosperity to the Boomers. For economic and geopolitical reasons, the Silent Generation was a small cohort and, given its hardscrabble ‘lived experience’, inclined towards civic-minded stoicism. As a rule of thumb, the older Silents created the Boomers, while the younger Silents birthed Gen X.

The Boomer hegemony of the last half-century being what it is, there’s little need for me to recount how the Boomers prospered in the decades following WWII.

But around the time Gen Xers began entering the workforce, Anglosphere societies became less prosperous as the 1970s degenerated into stagflation and bitter industrial conflict. Then they became less egalitarian as many of the same PMC Boomers who spent their youth campaigning for greater equality morphed into Reaganite/Thatcherite tax hawks. (I’ve always thought Jerry Rubin, co-founder of the Yippies turned stockbroker, was the quintessential Boomer.)

The neoliberal turn meant Gen Xers encountered a different labour market to that of their parents and grandparents. One that offered ever-greater rewards to an ever-shrinking proportion of the population. One in which Capital was able to remove pricing power from Labour by simultaneously outsourcing jobs to developing nations while insourcing cheap labour from them.

That’s just the economic side of things. Along with more economic liberalism came more social liberalism. Gen Xers were supportive of greater social liberalism up to a point. Many felt that point was reached sometime around 2012-2014, when largely Gen Y/Millennial activists unleashed the Woke Cultural Revolution.

Many of the controversies of the woke era involved twentysomething and thirtysomething progressives facing off against fortysomething and fiftysomething old-school left-liberals. An argument could be made that 2020 was the Millennials’ 1968, with Gen Xers thrust into the role of Mayor Daley.

Prince Charles Syndrome
Whatever other legitimate grievances they have, Generations Y and Z have only spent, at most, 45 years being cockblocked by the Boomers. Older Xers have now spent six decades waiting for their turn to ascend to the top of the greasy pole.

The analogy is a little off the mark given it involves a Silent and her Boomer son, but Gen X has had Prince Charles Syndrome since it reached adulthood. And while Boomer hegemony is now waning, it remains powerful. Both of the world’s superpowers are led by Boomers, as are Germany, India, Indonesia, Israel and Russia. The Boomers have proven reluctant to pass on the torch and Anglosphere societies have become increasingly gerontocratic as a result.

Having been overlooked all their lives, many Gen Xers feared that when the time did come for a transfer of power, the Boomers would be bequeathing their corner offices to their equally self-assured progeny, the Millennials. If J.D. Vance, or one of Trump’s children, succeeds Trump, such a Gen-X-skipping changing of the guard will take place following the next US presidential election.

When I interviewed Gen X author John Birmingham about this almost two decades ago, he wearily sighed:

X will never be in control. Those boomers will hang on till their dying breath. And then Y will sweep in at the funeral looking for the keys to the house and the car. When I raise these issues in my blog writing, the X-ers who comment all do so with deeply bitter black humour. We tend to think of ourselves standing mute in front of history’s big black tsunami; there’s a sense of pointlessness to organised political activity that stops us from getting too worked up. We’re tired. We’ve been tired from the age of 17.

I’ve long assumed Birmingham’s bleak prediction would be fulfilled. But changing economic, political and technological conditions now lead me to wonder if Gen X’s moment has arrived.

A little earlier than it did for Charles, who was in his mid-70s when he ascended to the throne.

Gen X’s second act. Or maybe its first
It’s not like Xers have been entirely bereft of influence. While technically making the cut-off to be Boomers, Barack Obama, Anthony Albanese, Sanae Takaichi and Keir Starmer are culturally Gen X. Argentina, Canada, Finland, France, Greece, New Zealand, Spain and Ukraine are led by Gen Xers. If J.D. or Don Jr. doesn’t succeed Trump, a Gen Xer – possibly Kamala (once again, technically a Boomer but effectively a Xer) – might.

The digital world that’s subsuming the old meatspace version was also largely built by Gen Xers – Marc Andreessen, Sergey Brin, Jack Dorsey, Reid Hoffman, Travis Kalanick, Elon Musk, Satya Nadella, Larry Page, Sundar Pichai, Peter Thiel and Susan Wojcicki.

Gen X was also the driving force behind grunge, alt rock, hip-hop, rave-techno-electronic music, indie film, several classic TV shows (The Simpsons, Seinfeld, The Sopranos, The Office), video games, early internet culture and DIY publishing.

Mid-to-late-career Gen Xers are now overrepresented among the ranks of business owners, CEOs, judges, journalists, religious leaders, union bosses, university vice-chancellors/presidents and so on.

But at the risk of repeating myself, Gen Xers have spent their lives in the long shadow of the Boomers. They never challenged what might be labelled the ‘Boomer settlement’.

However, the Boomers are now on the way out. The potent mix of economic and social hyperliberalism that worked out well for them has been less agreeable to succeeding generations. Plus, we are in the foothills of the Singularity, the most momentous development in the course of human history.

A generation of Cincinnatuses?
For two and a half millennia, Lucius Quinctius Cincinnatus has been held up as the exemplar of the reluctant but self-sacrificing leader. Cincinnatus was a Roman general who, as the story goes, grew weary of the burdens of high office and retired to his farm, metaphorically beating his sword into a ploughshare.

Then Rome gets into trouble, Cincinnatus is appointed dictator, saves the Roman republic and – get this – gladly surrenders the emergency powers he’s been given and returns to his farm. (Maximus in Gladiator is loosely based on Cincinnatus.)

Once again, this is an inexact analogy in that Gen X hasn’t yet fought any great battles. It was raised in the shadow of two World Wars, but has lived in a world largely at peace. In stark contrast to the ‘Don’t trust anyone over thirty/Hope I die before I get old’ Boomers, Xers never even went into Oedipal battle against the older generation and remade society in their image. As Birmingham observed, Xers embraced a cynical, moderately anti-authoritarian worldview while remaining quiescent in the face of history’s big black tsunami, having concluded that resistance was futile.

But Gen X’s moment may just have come.

The data suggests we are now at an inflection point. Human labour is being automated away, institutions are being drained of the last of their legitimacy, the postwar liberal order is disintegrating, and politics is entering one of its “now is the time of monsters” phases.

And Xers are the ones in the driver’s seat. Or at least they will be once the few remaining Boomers are escorted off the premises.

Like Cincinnatus, a generation that mostly wanted to hunker down and be left alone may soon find itself summoned from the farm.

The “AI job loss” narratives are all fake. AI = massive ramp in productivity = massive ramp in demand = massive jobs boom. Watch.
Marc Andreessen, X, 6/4/26

jobs doomerism is likely long-term wrong. though of course there will be disruption/significant transition as we switch to new jobs, the jobs of the future may look v different, etc.
Sam Altman, X, 2/5/26

Coder Displaced By A.I. Told He Should Just ‘Learn To Mine Coal’
Government officials rolled out a new initiative to assist displaced coders as they transition into the modern age of manual labor in the mines. The program, called Code2Coal, reportedly includes a two-hour online seminar titled “So You’ve Been Replaced By A Machine: Now What?”

“It’s going to be a big change, but I really do consider myself lucky,” said Garrison. “Fortunately for me, I used to be a coal miner before Biden shut down the mines. He told me to ‘learn to code’, so I spent the past three years mastering Python and Java. It seems like a bit of a waste now, but at least I already know my way around the mines.”

At publishing time, Democrats had vowed to pass legislation to shut down coal-powered data centers
The Babylon Bee, 4/5/26

Cynical observers will see this all as just a messaging pivot… the AI industry’s sales pitch was basically “Our product’s purpose is to put you and your descendants on welfare forever, and it may also wipe out your whole species”.

That was a bad sales pitch, to put it mildly, and it’s not surprising that voters have reacted negatively to this message. Basically every recent poll shows the American public turning very strongly against AI… it makes sense for leading figures in the industry to alter the basic sales pitch and reassure anxious humans that they’ll still have jobs.
Noah Smith, Noahpinion, 5/5/26

I’ve spent the last 18 months or so attempting to warn people that Silicon Valley is bracing for a permanent underclass. So, I was happy to see this New York Times thinkpiece, entitled Silicon Valley Is Bracing For A Permanent Underclass, go viral over the last week.

The author, my fellow Substacker Jasmine Sun, made many sensible points about the entirely predictable outcomes of automating away jobs. Below, I’ll share her money quotes and add some commentary.

First things first – you and everybody you know is screwed
Here’s the bracing opening paragraph of Sun’s article:

Most people I know in the A.I. industry think the median person is screwed, and they have no idea what to do about it… While Silicon Valley has long warned about the risk of rogue A.I., it has recently woken up to a more mundane nightmare: one in which many ordinary people lose their economic leverage as their jobs are automated away.

There’s what people proclaim in public, and there’s what they share in private. You can usually put more trust in the latter than the former. What are Sun’s fellow San Franciscans saying about AI?

Whether you talk with engineers, venture capitalists, founders or managers, or with doomers, accelerationists, lefties or libertarians, the so-called San Francisco consensus on the impact of A.I. for workers is bleak… it would also displace millions of jobs as fewer humans are needed to make the economy run. The technology will depress economic mobility and exacerbate inequality, while ferrying power and wealth to the A.I. companies and the existing owners of capital.

As Sun points out, “This premonition is not a well-kept secret”. Indeed, many high-profile tech industry figures – including OpenAI’s Altman, Anthropic’s Amodei and Grok’s Musk – have spent years warning of just such a scenario.

We’ve seen this movie before
We’ve had a trial run of what happens when a shedload of jobs go away suddenly. Spoiler alert: it doesn’t end happily, at least for those left jobless.

The term “underclass” gained currency in the 1960s to describe the factory workers left behind by the postwar automation boom. Today, it has become repopularized as a viral term for a theory that posits that people have a limited window of time to build wealth before A.I. and robotics are advanced enough to fully replace human labor. At that point, we will get frozen in our current class positions: The rich will be able to deploy superintelligent machines to do their bidding, and everyone else will be rendered useless and unemployable, left to live off welfare scraps.

Getting welfare scraps might be the best-case scenario, but let’s not get ahead of ourselves.

The inescapable market logic
Everyone can see the game-theory logic powering the continual investment in AI and the resulting redundancy of human workers. Neither China nor the US can allow the other to gain a commanding lead in AI, as the recent brouhaha over Mythos illustrated. None of the big AI companies can afford to let their rivals steal a march on them. And any individual business that hesitates to automate away human labour will soon be driven out of the market by competitors lacking such sentimentality.

If left to its own devices, Silicon Valley may summon a permanent underclass through its own market logic. If you believe that human-substituting A.I. is inevitable, then every company should race to be the one to build it… Corporate executives accelerate layoffs and slow hiring because they don’t want to be the firm lagging behind… Sometimes, layoffs happen even before executives know how or whether A.I. will replace those roles.

Tech industry workers are now in a position not dissimilar to the physicists working at Los Alamos from 1943-1945.

Tech workers, for their part, are scrambling for lucrative A.I. jobs in hopes of securing financial freedom — even when they harbor ethical hangups. “People feel like there are not that many opportunities to make money in the future,” said Steven Adler, a former employee on OpenAI’s safety team who now writes a newsletter on A.I. policy. “Even if someone thinks it is personally distasteful to make money from building technology that companies say may literally kill everyone, many people are just cogs in the machine.”

Escaping the inescapable market logic
It hasn’t escaped the attention of AI companies that a society in which an ever-increasing share of resources is being funnelled to an ever-decreasing proportion of the population is a pre-revolutionary society. Whether or not a full-blown revolution is on the cards, there’s clearly an anti-AI backlash building in the US and the rest of the Anglosphere.

What to do?

OpenAI, Anthropic and Google DeepMind have now set up the equivalent of think tanks to look into how AI companies can keep making money without creating the type of mass unemployment that results in large AI companies getting nationalised.

As I wrote about a few weeks ago, OpenAI even released a white paper, Industrial Policy for the Intelligence Age: Ideas to Keep People First, calling for ameliorative measures. But while plenty of tech company founders will talk the wealth-redistribution talk, it’s an open question as to whether they walk the walk.

Many of the ideas listed in OpenAI’s white paper are radically progressive: a 32-hour workweek, higher taxes on corporations and capital gains and a “public wealth fund” that provides all citizens an equity stake in A.I. companies…

Still, the document is vague on implementation mechanics and whether OpenAI will advocate the policies listed. In an emailed statement, an OpenAI spokesperson declined to provide examples of specific legislation the company supports.

How do the ‘Useless Eaters’ react?
Mass enfranchisement is a recent historical development. Nonetheless, helots, slaves, peasants, serfs, proletarians and other non-elite actors have always had at least a modicum of political power. That’s because they could withdraw their labour (or at least try to). But what happens when elites no longer require that labour?

As Anthropic’s Amodei argues, “The balance of power of democracy is premised on the average person having leverage through creating economic value. If that’s not present, I think things become kind of scary.”

But as Sun predicts:

Anthropic’s coffers probably won’t be emptied in the service of public work-force programs unless politicians compel the company to do so. Anthropic has not yet released a set of economic policies that the company supports, either in broad strokes, as with OpenAI’s white paper, or by endorsing specific legislation…

When I asked Mr. Clark if the Anthropic Institute planned to lobby for the redistributive measures he alludes to, he demurred, describing policy advocacy as “the end of a very, very long chain of work.”

Let’s summarise where we’re currently at.

1. Those most knowledgeable about AI expect it will eliminate a lot of cognitive labour in the near term (1-3 years) and then physical labour in the medium term (3-8 years).

2. No nation, industry or business can take its foot off the AI accelerator lest it get outcompeted.

3. Severe labour market disruption could (kind of) be managed with redistributive policies.

4. Many prominent tech companies and their founders have called for such policies.

5. The tech companies and founders calling for redistribution game tax systems across the globe to make the minimal possible contribution.

6. While the Silicon Valley bigwigs talk a good fight about shifting things in a more Scandinavian direction, there’s little evidence they are lobbying to have the policies they putatively support introduced. (If you were the cynical type, you might even suspect they’re quietly lobbying against their introduction.)

Here’s the good news, such that it is. If the Left can pull its head out of its identity-politics-addled arse for five seconds, this could be its moment to shine.

Sun wraps up her article with an account of attending a ‘How to Prepare Our Politics for AGI’ event put on by Democratic pollster and strategist David Shor.

Shor argues that the AI-enabled automation threat has even constitutionally optimistic Americans considering the possibility they’re not just temporarily embarrassed millionaires.

While the American public ordinarily hesitates to support left-wing policies like a jobs guarantee or single-payer health care, A.I. seems to expand the political Overton window. “Right now, the argument is, ‘You’re all about to lose your jobs, and the choice is either you get nothing and starve, or we do something fair,’” Mr. Shor said. “People don’t want to be members of the permanent underclass…”

As many have before her, Sun observes that AI is now doing to the Professional Managerial Class what a combination of globalisation (exporting jobs to developing countries while importing migrants from them) and automation have been doing to the working class since the 1990s.

A.I. will look like an accelerated and expanded version of deindustrialization. But rather than companies outsourcing jobs to overseas workers, they will be outsourcing them to A.I. agents. “The China shock unfolded over several years, whereas this could happen over two years,” said Bharat Ramamurti, a former deputy director of the National Economic Council in the Biden White House.

Knowledge workers are now having to ask questions that never used to trouble them.

What happens if the invisible hand of the market decides that my skills are no longer valuable? Who will catch me if I fall? For once, a rarefied class of employees — those used to being the automaters, not the automated — is reckoning with their potential obsolescence.

Elsewhere in the passage, Sun muses that by facilitating this proletarianisation, “A.I.’s broad capabilities foster a rare class solidarity between white-collar and blue-collar workers.”

I’m sceptical of the notion “rare class solidarity” will develop between proletariat and bourgeoisie. The reason such solidarity is rare is because the two demographics don’t have much in common. Then there’s the small matter of the Professional Managerial Class treating the working class with thinly veiled, or completely unveiled, contempt for several decades. Not least during the High Woke Era of 2014–2024.

Sun suggests that either a restive electorate will force politicians to slam on the brakes or AI will wreak so much labour-market havoc that a business-shuttering, plutocrat-liquidating revolution will kick off.

If you hear that A.I. will entrench a permanent underclass, you’ll do anything to stop it. Across the United States, there are new proposals for bans on data center construction, on self-driving cars and on chatbots for broad consumer uses like therapy and law. In the extreme, populist rage can metamorphose into violence. In April, an attacker tried to firebomb Mr. Altman’s home…

In March, the Palantir chief executive, Alex Karp, spoke on a panel with the Teamsters president, Sean O’Brien. “The biggest challenge to A.I. in this country is political unrest,” Mr. Karp said. “If I were sitting here in private with my peers, I’d be telling them the country could blow up politically and none of us are going to make any money when the country blows up.”

Our bet is sort of that in the next year, probably, I don’t know, maybe half the development is going to be done by AI as opposed to people, and then that will just kind of increase from there.
Mark Zuckerberg, 30/4/25

We are now seeing a major AI acceleration. I expect 2026 to be a year where this wave accelerates even further on several fronts. We’re starting to see agents really work. This will unlock the ability to build completely new products and transform how we work… As we plan for the future, we will continue to invest very significantly in infrastructure to train leading models and deliver personal superintelligence to billions of people and businesses around the world… we’re investing in AI-native tooling so individuals at Meta can get more done, we’re elevating individual contributors, and flattening teams. We’re starting to see projects that used to require big teams now be accomplished by a single very talented person.
Mark Zuckerberg, 28/1/26

Meta has been in the news this week in my homeland of Australia. Well, all the tech behemoths have, in one way or another, but Meta has been the focus. So, I thought I’d look at three Meta-related news stories and what they portend for the future – a future that I fear is bearing down far quicker than most people realise.

The big news down under, as elsewhere, was Zuck’s restructuring of Meta.

Zuck has been trimming his workforce for some time, but he recently announced 10 per cent of Meta’s workforce is getting the heave-ho this month and 6,000 open roles will be left unfilled. Meta has been coy about further layoffs, but credible sources report more redundancies are planned for the second half of the year and the size of those cuts will depend on “developments in artificial intelligence capabilities”.

Meta is not merely asking its remaining workers to use AI. It is asking them to become training data for it.

Meta is installing software on US-based employees’ computers to capture mouse movements, clicks, keystrokes and occasional screen snapshots for AI training. The tool is called the Model Capability Initiative and is designed to teach Meta’s models how humans actually interact with computers – choosing from dropdown menus, using keyboard shortcuts, clicking through work apps and so on. As one internal memo put it, “all Meta employees can help our models get better simply by doing their daily work.”

The broader program has been renamed the Agent Transformation Accelerator. Meta CTO Andrew Bosworth has said of this program, “The vision we are building towards is one where our agents primarily do the work and our role is to direct, review and help them improve.”

Meta wants AI to do the work, while the remaining human employees become AI supervisors/editors/correction mechanisms.

Of course, as artificial intelligence capabilities develop, there will be ever less need for humans to supervise, edit or correct the work of AI systems.

Along with several other tech companies, Meta is on the cutting edge of replacing expensive human cognitive labour with AI. But what’s happening at innovative tech companies today will be coming to run-of-the-mill, late-adopter businesses tomorrow.

Any job done entirely through a screen, keyboard and mouse (i.e. a ‘KVM job’) is highly vulnerable to automation because AI agents are learning to operate the same interface humans use. Not just answer questions. Not just draft text. Agents can now look at a screen, click buttons, type into fields, move through apps, fill forms, edit spreadsheets, write code, triage emails, update CRMs, generate reports and coordinate workflows.

There’s still debate around exactly when a critical mass of KVM jobs will be automated, but most now agree the process has started to unfold.

In February, Microsoft AI chief Mustafa Suleyman predicted that AI would reach “human-level performance on most, if not all professional tasks” and that many tasks involving “sitting down at a computer” could be automated within 12-18 months, including work in accounting, law, marketing and project management.

Anthropic CEO Dario Amodei has warned that AI could wipe out half of entry-level white-collar jobs within one to five years, especially in technology, finance, law and consulting.

Those forecasts may prove too aggressive. But they are not coming from wild-eyed fringe dwellers. They are coming from people building the systems.

To summarise, AI is going to vaporise a lot of well-paying, mid-to-high status white-collar jobs. Nobody is sure how rapidly that process is going to play out, but those closest to the action predict profound labour market disruption between now and 2030.

Perplexity CEO Aravind Srinivas recently encouraged soon-to-be-made redundant workers to look on the bright side. During an episode of alpha-tech-bro podcast All In, Srinivas said, “The reality is most people don’t enjoy their jobs. There’s suddenly a new possibility, a new opportunity, to go use these tools, learn them, and start your own mini business… Even if there is temporary job displacement to deal with, that sort of glorious future is what we should look forward to… Either the other people who lose jobs end up starting companies themselves and make use of AIs, or they end up learning the AIs and contribute to new companies.”

The glorious future
I have my doubts about Srinivas’s specific claims, but he’s directionally correct about the possibility of a glorious future.

I’m sceptical of the idea that those automated out of a job are going to start their own business or find employment elsewhere. That will happen to some extent, of course, but there are all sorts of obvious issues with Srinivas’s rosy vision.

What kind of businesses are displaced individuals going to start? If AI rapidly automates cognitive labour away, they will have to involve physical work. In some cases, people will be able to retrain as, say, tradesmen and open their own business. But given how quickly robotics is now advancing, I’m not sure blue-collar (or pink-collar) labour is going to be safe from automation for long either.

Then there’s the issue of the market for what your business is selling. If there’s mass unemployment, are many people going to be paying someone else to mow their lawn, clean their house, cook their dinner or unclog their S-bend?

That noted, Srinivas makes a valid point about most people not enjoying their work. Most people don’t have jobs that provide a sense of personal satisfaction and raise their social status. Those people would be delighted to spend less time working and more time doing the things they enjoy. Such a glorious future is now in reach, if the benefits of automation and AI-driven productivity gains are shared equitably.

Worryingly, equitable sharing has been out of fashion for nearly half a century and tech companies have proven especially reluctant to pony up for the common good. Which brings me to the two other stories involving Meta that have broken in recent days.

We’re not all in this together
Wherever you’re based, dear reader, you’ve probably seen this kind of story many times before, so I’ll attempt to keep this brief.

Earlier this week, it was reported that Meta generated $1.74 billion in gross Australian advertising revenue last year but 87 per cent of that was sent offshore, leaving just $223.9 million in net revenue. Meta paid the princely sum of $61.16 million to the Australian Tax Office (ATO) in 2025.

Many ordinary Australian workers face marginal tax rates north of 30 per cent. Meta, by contrast, paid the ATO an amount equivalent to about 3.5 per cent of the gross ad revenue it generated.

Australia’s banks are minnows compared to the American tech behemoths. Yet as the Australian Banking Association recently pointed out, they paid $16 billion in taxes last financial year. In comparison, Alphabet, Apple and Meta collectively contributed $515 million.

Unlike Srinivas, plenty of tech industry heavy hitters have been honest about the fact many people are going to find themselves automated out of a job with no realistic prospect of finding other ways to generate an income.

Some, including Sam Altman, Bill Gates and Vinod Khosla, have argued that as AI (further) shifts economic power from labour to capital, tax systems will have to follow the money. Others, including Zuckerberg, Musk, Amodei and Hassabis, have gestured toward UBI, universal high income or broader redistribution.

Let’s leave aside the historical lesson showing that the losers of globalisation never received much compensation and assume it could be different this time around. It should be noted that tech companies, and their founders, employ armies of well-remunerated tax lawyers, accountants and transfer-pricing specialists to aggressively minimise their tax obligations.

But maybe tech company founders, especially nowadays, are all libertarians who prefer to dispense largesse directly rather than give money to inefficient bureaucracies?

Perhaps people like Zuckerberg quietly do good deeds, like throwing a few shekels to the legacy media organisations whose lunch they so comprehensively cut. After all, a free and independent press is vital to holding power to account, exposing wrongdoing and testing official claims.

A few days ago, the Australian government proposed an arrangement where Google, Meta and TikTok either provide funding to Australian media organisations or face a levy of 2.25 per cent on their Australian revenue.

Having already opted out of a similar earlier scheme, Meta reacted angrily to the latest proposal labelling it “nothing more than a digital services tax” and a “government-mandated transfer of wealth” from one industry to another with “no connection to the value exchanged”.

Things will move quickly from here on in
As I point out with monotonous regularity every Friday morning, AI is going to automate away a lot of jobs, especially the KVM ones. That’s not something that might happen in a few years’ time – it’s a process that is already gathering serious momentum. As Srinivas argues, that doesn’t necessarily have to be a bad thing – many people would be happy to see their job automated away if they no longer had to worry about generating an income.

But we’re only going to get a UBI, or anything like it, if governments make the companies currently capturing AI’s upsides contribute.

Given tech companies have long struggled to be good corporate citizens, it’s optimistic to assume they’re about to mend their ways, unless forced to by voters and their elected representatives.

The future Meta is building may well be technologically astonishing. It may free millions of people from dull and degrading work. But if the businesses automating labour also minimise tax and resist funding public goods, the future looks grim rather than glorious.

Yet one fine day, in a fit of euphoria, after he had picked up the telephone and taken an order for zero-coupon bonds that had brought him a $50,000 commission, just like that, this very phrase had bubbled up into his brain. On Wall Street he and a few others, how many? Three hundred, four hundred, five hundred? Had become precisely that . . . Masters of the Universe. There was … no limit whatsoever! Naturally he had never so much as whispered this phrase to a living soul. He was no fool. Yet he couldn’t get it out of his head.
Tom Wolfe, The Bonfire of the Vanities, 1987

PwC partner income rises to $814,000 due to AI adoption, fewer staff
AFR headline, 16/4/26

How AI shrank a 40-person PwC consulting team to just six
AFR headline, 17/4/26

But this stasis is just the rancid icing on the spoiled cake of much longer trends. A new working paper from three economists explains how the U.S. job ladder has been breaking for 40 years. This decades-long problem doesn’t affect just Gen Z but has also stymied wage growth for Americans in their 30s, 40s and 50s. This could be why the midlife millennials I interviewed a few years back felt that they were physically in their 40s but economically in their 20s, unable to find a career that felt secure.
Jessica Grose, NYT, 22/4/2026

Imagine you are 18 and what my fellow Substacker Richard Hanania calls elite human capital.

You are of above-average intelligence and expect to join one of your society’s sense-making or decision-making institutions, securing a role that will (a) facilitate a ‘comfortable lifestyle’, (b) give you disproportionate influence over your society’s culture, economy and politics, and (c) provide a reassuring amount of social status.

Necessarily – but not sufficiently – you’re 1-2 standard deviations above the mean IQ. You’re in the 115-130 range – part of the top 15 per cent of the population in cognitive ability.

Now, let’s be realistic here, you don’t have a 130+ IQ. Some paths are closed to you. Even under the stern tutelage of the most unforgiving of immigrant tiger parents, you’re unlikely to make it to medical school.

But you’re still smarter than most. You should be able to secure a job befitting your intellectual abilities and life ambitions. You’ll be getting a serious degree – law, accounting, engineering, economics, commerce, business, computer science – from a top-tier university. Then you’ll join a law firm. Or a management consulting firm, ideally McKinsey, BCG or Bain. Or you’ll hitch your little red wagon to one of the Big Four professional services firms – PricewaterhouseCoopers (PwC), Deloitte, EY and KPMG.

You’ll be pulling down comfortable-lifestyle-enabling money from the get-go. Indeed, you’ll start on a salary that’s more than many of your compatriots will make at the peak of their careers. If you make partner, you could be earning 10x the median salary by your mid-thirties. A few years of earning that kind of coin and you’re edging into “fuck you” money territory.

At the very least, you can afford a lovely home in a desirable location, expensive clothes, luxury cars, pricey restaurants, private school fees and regular overseas vacations.

If you’re ‘encouraged’ to retire in your mid-fifties, you’ll be able to do so easily. Maybe you’ll sit on a few boards, perhaps you’ll take it easy after several decades of 60-hour-plus weeks and up-or-out work cultures.

At least, that’s the way things used to be. But it seems AI is now coming for human capital of all varieties.

Elites are shrinking
The articles referenced in the AFR headlines above are paywalled. But here’s the tl;dr: last Thursday, Australia’s business paper ran a story about PwC Australia lifting average partner pay despite falling profits. How did they manage that? With AI-led efficiency gains and reduced headcount, of course.

Last Friday, the AFR explored how the increased efficiency and reduced headcount came about.

PwC used 18 AI agents to replace much of a 40-person consulting team and cut a project’s timeframe from 18 months to 90 days. AI handled coding, testing and documentation, boosting speed and quality, while humans shifted to oversight.

I imagine The Wall Street Journal, Financial Times, Handelsblatt, Les Échos, Nikkei and the South China Morning Post have similar stories about elite human capital being displaced by AI.

AI is ‘spiky’ and struggles with some things, such as spatial reasoning or novel-problem solving. But it is superb at what lawyers, management consultants and professional service firm partners are selected for – verbal intelligence, pattern recognition, recall and synthesis.

So, what happens when societies that were once broadly middle class and then structured on a 20:80 basis (with lawyers, management consultants and professional services providers comfortably ensconced in the top quintile) undergo further Brazilification?

Those unable to secure a grad role at a fancy law, management consulting or professional services firm will likely receive roughly as much public sympathy as those upset their PhD in lesbian interpretive dance only led to a job as a barista.

But while non-elite human capital will struggle to sympathise with would-be Masters (and, nowadays, Mistresses) of the Universe, they should be able to empathise with them.

The post-WWII decades saw the creation of a world where there was a lot more opportunity to get ahead economically. This was followed by the neoliberal era, where the rewards for getting ahead became much greater, but the opportunities for doing so became more constricted.

In the glorious three decades following WWII, a man could drop out of school in his mid-teens and, via a blue-collar but reasonably paid job, enjoy a middle-class lifestyle involving home ownership, marriage and children.

From circa 1980, opportunities to “get ahead in life” began contracting for Joe Sixpack. At the same time, the rewards flowing to cognitive elites started increasing.

However, if you were sensible enough to “get a good education”, the (increasingly globalised) world was still your oyster.

But then the supply of university graduates began outstripping demand. If you went to the sort of university that law, management consulting, and professional services firms recruit from, you’d probably still be able to achieve a lifestyle involving home ownership, marriage and children. Otherwise, you’d be joining the ever-expanding ranks of downwardly mobile graduates and manning the espresso machine at Starbucks.

Thanks to AI, we seem to have reached the final stage of the process. Now, even the cream of the human capital crop – the ones with above-average IQs, the ones who went to good universities, the highly conscientious, highly competitive, gratification-delaying overachieving ones, the ones who grew up being told they were destined for big things, the ones who did all the right things – are struggling.

A new aristocracy
If there are ever fewer but increasingly well-remunerated jobs and growing numbers of people leading a near-subsistence lifestyle financed by gig-economy work and/or a modest UBI, that sounds a lot like a neo-feudal society to me.

I’m not the only one who’s had that thought. The New York Times recently published an article entitled We Are Witnessing the Rise of a New Aristocracy by Jennifer M. Harris

Here are the money quotes:

As A.I. transforms anything touching a keyboard, it will land first and hardest on the income ladder’s middle and lower rungs…

When more people are out of work, those who still have middle-class jobs — the marketers, the air traffic controllers and so on — will have less bargaining power, reducing their wages. A.I. can reinforce this downward spiral by lowering the expertise required for these remaining middle-class jobs…

The flywheel that turns wealth inequality into democratic backsliding is already churning. If we want to keep the “democratic” in democratic capitalism as A.I. takes hold, we’d better get to work.

Harris, a former Biden economic official, is chiefly concerned with the prospects of low-income and middle-income workers. She believes elite human capital, or at least old-money elite human capital, will be relatively insulated from AI.

Premiums for elite graduates with hefty Rolodexes full of powerful people, and tacit knowledge (like how to generate a laugh at a cocktail party on Park Avenue), aren’t going anywhere. Chatbots are no substitute for people who can call the right people when high-stakes deals go awry.

But regardless of exactly how soon and severely elite human capital is impacted by AI-driven automation, the broader point stands. There are going to be a lot fewer people invested in the status quo and a lot more with nothing much to lose. If Harris’s data is right, we’re now in the process of moving from 20:80 societies to 3:97 ones:

OpenAI and Anthropic, which are already operating globally, employ only a few thousand people. Microsoft employs more than 200,000, and Amazon employs 1.5 million. The picture that emerges isn’t of just a deepening of the current divide. The A.I. story is one of more extreme concentration of wealth — at most likely not more than 3 percent of households, the very few who hold ownership in these A.I. companies or in the mostly private firms financing them.

Harris ends her article by arguing deepening Brazilification isn’t “a foregone conclusion”. She argues the process could be reversed by designing AI to augment workers, taxing capital more like labour, and broadening ownership of AI-generated wealth through public or worker stakes.

I don’t know how politically feasible any of those proposed solutions are. But I’m sure many in the elite human capital class will be loudly advocating for such measures in the months to come.