AI and the Next Economy

"Today, many AGI narratives assume that the "prolific" can keep producing and the broad mass of customers ("the devourer") somehow continue to buy, even as more and more human labor is displaced and labor income and bargaining power collapses. That's not a future of abundance. It's a recipe for a kind of congestive heart failure for the economy: Profits and capabilities accumulate in what should be the circulatory pump, while the rest of the body is starved."

"So if we want an AI economy that makes society richer, we need to ask not just "How smart will the models get?" and "How rich will AI developers, their investors, and their immediate customers get?" but "How will the value circulate in the real economy of goods and services?" Not "What can we automate?" but "What new infrastructure and institutions are needed to turn capability into widely shared prosperity?""

An economy requires circulation: production must be matched to demand through broadly distributed purchasing power. If automation concentrates income and collapses labor bargaining power, output will outpace consumers' ability to buy, producing stagnation despite high productivity. Concentrated profits create a dysfunctional system where capabilities accumulate while broad demand shrinks. Achieving broadly shared prosperity from AI requires designing infrastructure and institutions that translate AI capabilities into widespread purchasing power and new sources of demand. Policy choices should focus on how value circulates across the real economy, not solely on what tasks machines can automate.

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