Someone made the point: “But today, about 50% of the total wealth is owned by just 1% of the population, which means that a huge chunk of the economy is already diverted from traditional ’employment and consumer spending’ and redirected towards catering to the rich. So it seems that in the future, the rich can continue to concentrate even more wealth in their hands without any repercussions for them.”

Wealth distribution has always been ruled by a kind of Pareto principle, with the top 1% controlling 20 – 40%.

And that works when we still have a functioning economy – relatively low unemployment, with people spending money.

But that changes if we have unemployment of 10, 20, 50% of the population due to AI taking jobs. The IMF is predicting 40-60% of jobs in developed economies will be effected.

“Effected” doesn’t necessarily mean “lost”, but we don’t know what it means. In the past, technology has replaced jobs but we’ve always been able to re-skill people, find them other things to do for an income. But in a world where AI is taking knowledge-worker jobs, and robots are taking manual labour jobs, I don’t see what kind of work is left. Maybe new things we can’t even imagine will be invented. But what kinds of work can exist that are safe from AI and robots? Not many that I can think of. Chrissy’s job as a violin teacher will probably be safe… if people can still afford lessons for their kids. But the list of jobs that are safe seem pretty limited.

Most wealth is held in assets – shares and/or property, bonds and cash, some gold and crypto. But their value is always relative to the broader economic health of the market.

So let’s say we have massive unemployment. That means people don’t have income. Which means they can’t spend money (unless their income is replaced by something else, eg a UBI, or some other kind of welfare). Which means downward pressure on prices. Which means downward pressure of profits. Which means businesses fail (unless they compensate by replacing their own employees with AI, which may or may not make the problem worse). Which means more unemployment. Real estate prices fall. The share market falls. The price of bonds, gold and crypto falls. Capitalism fails. And if the unemployment persists, it can’t recover.

You can’t have rich people if nobody is spending money in the economy. Wealth has no meaning in an economic collapse.

So let’s assume AI does replace lots of jobs. We will need to make major structural readjustments to the economy – either replacing incomes with some other kind of financial assistance to people who have lost their jobs (and can’t find replacement jobs), or totally restructuring capitalism into some kind of post-scarcity economy, eg the Trekonomics (