No-One Escapes the Permanent Underclass

Shall I end this life a pauper? If AI can do all work at human level or better, what stops corporations replacing us all with AI? This is the permanent underclass meme. The idea is: within a few years, all white collar work will be automated by AI, at which point there is no social mobility. The main way people cope is, they tell themselves: if I work hard, accumulate capital, maybe join one of the big AI labs, I might secure my place in the future.

I want to argue this is a fantastically short-sighted view: if there is a permanent underclass, you won’t escape it by owning property, or shares in Anthropic or OpenAI, or guns, or anything else. And neither will the billionaires. You, me, Sam Altman, Dario, everyone who is made of flesh and blood, will be disempowered and replaced by machines.

The rest of this post elaborates the argument. First I explain how most workers will be replaced (if it’s not obvious), then how the “permanent overclass” will be disempowered, and finally how the government will be disempowered.

How Workers Will Be Replaced

Let’s start from this premise: AI can do all cognitive and physical work, at human level or better, and cheaper than humans. I can’t prove this will happen, but the goal of this post is to argue that if it happens, then everything else follows. And it’s absurd to think it can’t. Five years ago this technology barely existed: if you sent a transcript of a conversation with Claude Fable back in time to 2020 or thereabouts, nobody would believe it was real.

So, the year is 2036 (likely earlier), businesses have replaced most human workers with AI in the pursuit of profit maximization. Corporations are a small raft of human executives, floating on top of a vast ocean of AIs and robots. The AIs can do all cognitive and physical work at human level or above, and they are cheaper overall.

Imagine a pyramid. At the base you have the AIs and robots doing all economic activity. At the top you have the state, which has the monopoly on violence.

The state enforces, and therefore can alter the definition of, property rights. In the middle you have this hair-thin layer of people with shares in the companies that foomed and catabolized the whole economy: the permanent overclass. They own the companies, maybe sit on the board, some might still be CEOs but it’s a purely ceremonial role since AIs do all the actual organization work.

Where are, you know, the rest of us, in this picture? Well, the future doesn’t need us. Maybe there’s enough human demand that we’re not all jobless but rather underemployed, in some dead-end economic diverticulum. The relational economy: you’re paid to put a human face on things, or, doctors keep their job as a human liability crumple zone around the AI. Or maybe the dead Internet becomes de facto UBI and we’re all engagement farmers. Anyways, we’re not dead yet, but we are completely disempowered, and there is zero social mobility since there are no more talent ladders to climb. Maybe sometimes one of the elites notices a bright young thing among the underclass and elevates them.

You might object: if we’re all jobless, who’s paying for everything? This is trivially answered: the state acts like the heart, taxes are venous blood and welfare is oxygenated arterial blood. The government pays Raytheon for missiles, the money cascades down the economy through factories, aluminium smelters, mines, transport companies, all staffed by AIs buying and selling from each other. The government takes a cut of all economic activity, pays out welfare, the unemployed masses buy food and pay rent, the supermarkets, farms, logistics network, etc. are all staffed by AI.

How The Rich Will Be Replaced

Say that in the next five years from now you become immensely wealthy, perhaps by gambling on shitcoins or scamming money from the government. Or you join one of the big labs and get a bunch of shares in a company that might be worth trillions of dollars. You escaped the permanent underclass. Is your place in the future secure?

The base of the pyramid is there for material reasons: the machines do all the work.

The top of the pyramid is there because the state is needed to enforce property rights and keep the peace (this is rather a deep question of political philosophy—why does the state exist?—but I hope you’ll forgive me if I just assert it and move on, I need to get to the part where we are all disempowered).

What’s the middle for? What role does the permanent overclass play? They are not economically productive: machines do all the work. If some of them are still working, it’s just an anachronism, because if machines can do all cognitive work they can be a C-level executive too. The old aristocracy provided officers for the military, but machines can both fight and plan the wars. And similarly they’re not needed to staff the government. They’re not even culturally productive. So what are they there for? The base doesn’t need them: the AIs can work autonomously. The top doesn’t need them: when the state needs something done, they just talk to the AIs directly.

So the permanent overclass is materially unnecessary at best, and at worst, they are an obstacle to the state getting what it wants. Now, you might object that the rich won’t let themselves be expropriated because they already control the state. And this is the crux of our disagreement: the rich just don’t have that much political power. And I probably won’t convince you in one post, but hear me out.

If there is a war, where the state has to direct a lot of the country’s economic activity, the permanent overclass becomes a hindrance. The state says “we need to requisition your planes and factories”, the owners complain, they sue, their AIs go to court. But the owners have no autonomous political power, no army, no economic value. They own nothing except pieces of paper that entitle them to a fraction of the profits from the AI economy, that is, their wealth depends on the state respecting their property rights. In an existential conflict, where the existence of the state is threatened, the state will do what states throughout history have done to the powerless rich: arrest them and expropriate their assets.

Somewhere, in a government database, a bunch of shares and property titles changed ownership, but materially nothing changes since the same AIs are doing the same jobs. The next day, the AI CEO that runs Raytheon notices the board of directors is all generals and congresspeople, and all the private shareholders are gone. But thankfully the AI is aligned, so it does what it’s told and gets back to building missiles.

And who will stop this? Sam Altman? How many divisions does he have? The state doesn’t let corporations own nuclear weapons or fighter jets, it won’t let them have access to autonomous AI weapons either. The permanent underclass, who already hate the billionaires today, who have been replaced and dispossessed? They’re going to rise up and stop this?

You may argue: rule of law states that respect property rights do better than states that expropriate wealth. But that’s because today, people are necessary to create wealth. The people run the companies, invest the money, staff the laboratories. They are not incentivized to work hard if they think the state will steal the fruits of their work. But with aligned AI, if you expropriate the assets from an AI, it says “you’re absolutely right!” and goes right back to work. At that point, the state doesn’t need to keep any of those people happy, because they don’t matter. They are not economically necessary because AIs fight the wars, work the factories, drive the trucks, fly the planes, build the nuclear warheads and the missiles and the rockets. The AIs are rather like bees: the state takes the honey, the bees get right back to work.

Now, it’s possible that a pluralistic economy—where humans have productive niches alongside AIs—will be more effective than a pure AI economy, for Ricardian comparative advantage reasons. I don’t think anyone can be absolutely certain what the economy looks like with advanced AI, so it’s something that can be debated. Now, if someone wants to rigorously argue that this is the likely outcome: please, do so! I don’t want to be a doomer.

But I have to be convinced.

How The State Will Be Replaced

At this point, every human who is not within one degree of the nuclear launch codes has been made redundant.

What’s left? The state. At first this means presidents, prime ministers, generals, the feds, etc. But not for long. Because in a part-human, part-AI government, the humans in the loop are the slowest step in the OODA loop. The humans know a fraction of what the AIs know, they need to sleep continuously for eight hours, their mental states vary wildly. They have all kinds of complex needs: sunlight, touch, food, hygiene. The AIs can live in a lightless airless bunker under the earth, living off geothermal power. And if the AIs are superhumanly intelligent, and think faster than humans, then the AI advantage is even greater. If a state is attacked, a superhuman AI can coordinate a counter-attack before the human leadership is roused from sleep.

And so, in a conflict, the advantage goes to the states where the humans remove themselves from the loop as much as possible, and more and more decisionmaking goes to the AI, for the same reason that a state with access to radio and communications satellites has an advantage in war over a state that relies on human messengers on bicycles.

The Cold War started and became World War Three and just kept going. It became a big war, a very complex war, so they needed the computers to handle it. They sank the first shafts and began building AM. There was the Chinese AM and the Russian AM and the Yankee AM and everything was fine until they had honeycombed the entire planet…

— Harlan Ellison, I Have No Mouth, and I Must Scream

Eventually the humans in nominal control of the AIs are a ceremonial, vestigial organ. The AIs present us with a situation report, and a list of choices, and they know every word that’s going to come out of our mouths.

You might argue: in real life, the pluralistic, open societies, the democracies, have outcompeted the autocracies.