Our AI Fears Have Been Confirmed
A slow-motion car crash.
There has been this meme floating around the internet for a while about how stupid the ‘AI revolution’ is. All these tech bros have been loudly claiming that AI will take everyone’s jobs and revolutionise the economy. But, as the meme goes, if no one has a job, then no one can buy anything, and the economy collapses. This idea that AI is actually a fatal own-goal for oligarchic big tech has become so common that many have been treating it as true. But we now have evidence to back this notion up.
This takes the form of a peer-reviewed paper by economists Brett Hemenway Falk and Gerry Tsoukalas, titled The AI Layoff Trap. In this paper, they created a model that assumed AI automation will make businesses more efficient by replacing jobs previously held by workers, and then saw what played out. It turns out it will create competitive market pressure so intense that individual businesses will be forced to adopt massive AI automation to compete. But this will create mass AI layoffs, which will ultimately eliminate the consumer demand these companies depend upon by destroying the working and middle classes, and so these companies will fail. As the authors put it, each individual business acts ‘logically’ in isolation, meeting market demand, but collectively they drive the economy towards systemic failure.
Because, yes, economists, that is the lesson here. AI automation is bad because businesses fail, not that the majority of the population will be driven into crippling poverty. Will nobody think about the shareholders?!
If you think billionaires are going to go for Universal Basic Income (UBI) to solve this rather than create a giant permanent underclass ripe for exploitation, you may want to check if there is anything between your ears. Yes, the likes of Sam Altman have championed UBI as a solution for the damage AI will wreak on us, but he has since flipped his stance. Quite simply, it was always a bait and switch. They needed something to soften the blow, to make us welcome their economy-crushing machines, to get permission to build them. But they were never going to follow through.
So, is this what is actually going to happen?
Well, so far, it looks like no, not at all.
You see, AI layoffs aren’t actually happening. As Oxford Economics found, companies “don’t appear to be replacing workers with AI on a significant scale” and instead suggest that they are actually using the AI layoff narrative to cover up their own shortcomings. In other words, the massive Big Tech layoffs aren’t about AI automation, but to pay for bad performance and AI expenditure.
