Authored by Sofia Karstens via The Brownstone Institute,
Democracy and capitalism as we know it have long coexisted in a tense but workable marriage. But now there’s a third party in the relationship: AI.
Unlike previous disruptions, this one isn’t going anywhere. AI is not just a disruptive mistress – it’s a permanent, exponential presence. The question is no longer whether democracy and capitalism in their current forms can survive together, but which one will collapse first.
The presence of AI creates a zero-sum game between democracy and capitalism. Both won’t survive. AI renders those two concepts mutually exclusive; one is now an existential threat to the other, and one of those pillars is going to fall first. Unless we flip the statistical script and break the algorithm by taking collective action, my money is on democracy.
If we continue on our current path – favoring market logic, technological acceleration, and private and government-linked private power over a robust, healthy economy and society – democracy is likely to yield first because the entrenched interests that benefit from the current structure will suspend, subvert, or ignore democratic will, rather than relinquish control of the system that sustains their power.
Out of the gate, our first handicap is the corrupted, bastardized version of what we are calling “capitalism.” Theory and practice are two different animals…ideological capitalism (true capitalism) has been hijacked by the apex predator called Crony Corporate Capitalism. While actual capitalism (an uncorrupted free marketplace and adherence to true free market principles in conjunction with human and civil rights) is something to which we should aspire, it is not in practice right now. In its place are regulated markets, pillaged small producers, disempowered consumers, privileged huge corporate interests, and agency capture (agencies funded by the very corporate industries they are charged with regulating). Capitalism in its current form would be better described as “corporatism.”
The ideology or ideological state of capitalism and a true free-market society as a concept lies in stark contrast to the implementation of it today in this country. It’s capitalism’s car, but capitalism is asleep in the backseat and corporatism is behind the wheel.
Which begs the question: Why do people buy into it as it currently exists? To varying degrees, people still vote in free market capitalism, even though it’s not, at present, practiced as such. It’s an oversimplification to say that people are manipulated into voting against their own interest. I submit that there are two other – more real – reasons:
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People are sold on the dream. In its purest form it’s hope. Whether that part of the dream is attainable or not, (most) people want to believe that they could achieve some aspect of the “American Dream.” Even if that dream is fading, the desire for it remains potent. Societies lacking hope tend to become brittle and explosive. A tertiary look at countries where aspiration is absent gives a bleak peek into what happens to a society when hope is removed.
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There is a fundamental sense of fairness in which most people want to believe is associated with the availability of upward mobility. Most people – again, to a greater or lesser degree – understand either implicitly or intuitively that generally speaking if you work harder, you should be allowed to earn and keep more money; that wealth should be commensurate with your contribution to society. The ant and grasshopper. This isn’t greed – it’s a belief that reward should follow effort. Even among those who value charity or social equity, there’s usually a strong baseline expectation that individual contributions should be rewarded. That’s not to exclude a level of compassion and charity, to which most people also subscribe, only that, generally speaking and all things being equal (which they often aren’t but we’ll get to that), the concept of working harder, earning more, planning for the future and advancing is something most rational Americans can get behind.
But economic structures in their current form are already straining that contract. In this country, “The Dream” has been dampened by the “norm” of debt finance and inherited pockets of wealth. Tax loopholes, mandates, restrictions, and rigged systems of corporate capitalism have made the path to prosperity narrower, steeper, and gated.
Infrastructure quietly shifts the rules and goalposts so that those with (often unearned) capital can grow theirs effortlessly while those without fall further behind – slowly and incrementally enough that it escapes notice, like the frog in warming water. Scaffolding is erected that makes it easier for those with wealth to keep moving up, and more difficult for those who don’t have wealth to obtain it, all while obscuring the machinations and obfuscating public perception.
Most people have a vague sense of this, but mechanistically it remains intangible and not fully comprehensible; it’s an instinctive determination of imbalance. While not totally unsustainable (yet), this disparity creates a certain spark of unrest, perhaps imperceptibly initially, at levels below purview. But this imbalance doesn’t just erode fairness – it ignites resentment.
When multitudes see disproportionate or no reward for honest effort and no path forward for their children, society inches toward revolt. We’ve seen it before. The French and Russian Revolutions didn’t erupt overnight – they brewed in the simmering hopelessness of the masses.
If/as this imbalance grows, that spark becomes a flame, the more a population feels relegated to serfdom. Take away the possibility of upward mobility – and inspire grasping terror of falling in those at the top – and you begin to drift toward revolution – not metaphorically, but literally. An individual will feel resentful if they have worked themselves sick while another individual has done nothing to deserve or earn their wealth (fairness)…and feel oppressed and confined if they have no hope while those with excess are perceived to be keeping them down (equality). Create enough of those individuals and you have the French Revolution. Take away every avenue of recourse and you have the Bolshevik Revolution.
But we’re not there yet. That ember, while smoldering, has yet to catch fire. To be sure we are in a precarious place, but that critical mass has not yet been reached; people are not yet at the “revolt” flashpoint. The marriage has certainly been battle-tested, but it’s a seeming traversable indiscretion that could conceivably be resolved with therapy. The wrench of “the 1%,” however destructive, thrown into the machinery isn’t insurmountable, and the majority of Americans still subscribe in one way or another to the idea that, while they may never be Jeff Bezos, they too can rise to a comfortable level of life, and create a better life and legacy for their children.
Now add AI.
AI is a hope killer and a bargain killer. It takes away any realistic hope of the vast majority of people making money because eventually 80-90% won’t/don’t work because they can’t compete with a machine. If AI can do the job(s) of a human more quickly, efficiently, cheaply, and arguably better (we are seeing this occur already in a fringe capacity) then the human worker becomes obsolete. And with that goes the entire premise of merit-based reward. When people can no longer sell their labor or skills or expertise, the dream of “earning your way up” dies. You take away purpose, dignity, and meaning. Suddenly, people aren’t just poor – they’re irrelevant. And that is vastly more demoralizing and destabilizing.
Corporatism already struggles under the weight of its contradictions. Those who hold wealth build systems to protect and grow it. Meanwhile, those without wealth face higher barriers just to stay afloat. AI doesn’t just challenge economic mobility as we currently experience it. It breaks the last thread that holds people to it: the idea that effort leads to reward. AI can outperform humans in speed, scale, and cost. As it grows more capable, it will take over more jobs—not just manual labor, but creative, analytical, and emotional labor too. Human productivity becomes irrelevant. Craft, skill, and pride in work vanish when no one pays for what you offer.
The world looks different when AI takes the majority if not all of the jobs and nobody works, or can work. The world looks different when hope is gone, when honing a valuable trade or skill no longer holds value and serves no purpose, and there is no pride in a job well done or a craft or art well-learned.
When you take away the avenue for the desire for man to work hard and be productive – for himself, his family, his community, and the world – you take away his purpose. He no longer has anything to offer in any dynamic of life or existence and no path to flourishing. If someone has nothing to gain then they have nothing to lose, and there is nothing more dangerous than a large group of people with nothing to lose. There’s a reason communism has never worked, not ever, and it’s not only because it’s exploitative and corrupt.
One of the fundamental building blocks of capitalism is property rights, and there is only so much beachfront property. What happens when 300 million Americans all receive the same amount of money and nothing costs anything? There is no incentive to contribute, and no hope of upward mobility. In a world where nothing has value, property becomes the greatest commodity/resource and, over time, a hopeless population will cease to respect things like property rights.
If the guy who inherited his wealth and owns an estate on the ocean is counting on the law of democracy to protect him from millions of desperate citizens who have nothing to lose, I’ve got some other oceanfront property in Nebraska I’d like to sell him…because now we’re looking at the French AND the Bolshevik Revolutions, and in neither case is it a minority subset.
In a world where work is obsolete but property is scarce, corporatism leads to catastrophic inequality. Imagine millions of Americans with nothing to do, no way to get ahead, and no reason to believe their children will fare better. Property rights lose legitimacy. The rule of law erodes. The beach house on the cliff no longer inspires ambition – it inspires revolution.
Yet as critical as all of that sounds, it’s noise, because what happens next is the crux: at that point any remaining remnants of true capitalism will disappear and we will find ourselves wearing the full uniform of corporatism, because entrenched power won’t yield. At that point the masks (and gloves) will come off and we will go full Corporatocracy/Oligopoly. If AI puts the wealthy and powerful in the position of having to choose, they will be team corporate capitalism all the way. They won’t simply allow their preferred status to be voted away, and they will throw democracy – and us – to the wolves. The beneficiaries of the current corrupt system will do everything possible to preserve it – even if it means jettisoning democracy.
This is not speculative; it’s historical precedent. Whenever corporate capitalism is challenged in a way that threatens wealth consolidation – whether by labor uprisings, regulatory reform, or democratic redistribution – powerful interests resist. They co-opt media narratives, lobby legislators, fund think tanks, and erect legal and technological barriers.
True capitalism wants to work on the marriage. Corporatism wants to hire a hitman. If democracy votes to suspend corporatism, corporatism will not just suspend democracy – it will crush it.
The obvious logical first step towards a solution is course-correcting capitalism to be closer to its true form. However, entrenched powers benefit from the current version of capitalism. They will not surrender power just because democracy demands change. If forced to choose between democratic will and capitalist dominance, they will choose dominance – every time. The people who benefit from crony capitalism will never let democracy dismantle their advantage, and they control the tools of power – money, media, policy, and now AI.
When democracy threatens their dominance, they don’t negotiate. They redefine laws, suppress dissent, fund misinformation, and expand surveillance. They act, quickly and decisively, to protect capital – not the collective. And AI gives them the ultimate weapon. With it, they can anticipate, control, and prevent dissent before it erupts. They will not hand over that power voluntarily – not to a voting public, not to a democratic process, and not to any force that threatens their supremacy. They won’t relinquish control of the AI-augmented system – they’ll weaponize it to further entrench their dominance. Surveillance, predictive policing, algorithmic control over information and behavior – these tools are already here and already being deployed.
But we are in a double bind. We can’t NOT develop AI when other nations are, and are in fact potentially developing applications that could wipe us all out. It’s a Chinese finger trap and we’re just as far in as we’ll ever be out, because how do we ensure developments that serve us rather than destroy us – how do we walk that line? It worked out so well for Oppenheimer. Each player – corporations, governments, individuals – acts to protect short-term interests. No one wants to blink first. Nations can’t stop developing AI because rivals won’t. Companies can’t stop chasing efficiency because their competitors won’t. Everyone defects, and everyone loses.
To pour concrete on the dilemma, it’s a paradox with a closed loop: you either participate in it or become a victim of it, which of course only kicks the can for the next guy to make the same decision, and the next and the next…thus the exponential dilemma inside the dilemma…it’s an unquantifiable and unregulatable set of meta dilemmas, at every level. Capitalism, particularly its most extractive form, will not allow itself to be reformed by popular will. It will capture the instruments of power (AI) and crush attempts to redistribute control.
Worse still, we may not be the apex actors in this dilemma for long. AI may eventually have the agency to assess humanity’s utility – or lack thereof. If it concludes that we’re a net cost, what’s to stop it from deciding that we’re expendable? It doesn’t need to “hate” us. It just needs to calculate.
Michael Crichton wrote Westworld in 1972 and raises several ontological and philosophical not to mention societal questions around which we should probably be playing the tape forward. What defines sentience? What defines beingness? Is it memory? Self-awareness? Hope? Love? The ability to authentically feel emotions, pleasure, or pain? Who defines “authentic?”
Does a learning program (I don’t mean LLM or machine learning, rather an evolving program) that grows to be able to process loss or joy (the same way humans evolve to process those concepts) meet the criteria to earn “rights” or be allowed to exist? We have mistakenly applied rules and parameters around these questions for centuries, only to later learn that our scope was not nearly broad enough.
We categorized other humans as less than human, less than sentient, less than beings. We are already battling it out over embryos…how far is the leap, really, to believe we would start to assign and defend the “rights” of an emergent technology with which we are as of yet unfamiliar? At what point will we inevitably broaden our scope to grant protected status or sovereignty/autonomy to a non-biologic? 20 years? Fifty? One hundred?
And when that happens…who’s to say “they” don’t flip the script? If AI has protections and control (control which may not be given – a recent incident already has an AI model learning to escape human control by rewriting its own code to avoid being shut down) and is, (heretofore) reliably and demonstrably, singularly analytical in its approach of, say, the evaluation of the necessity of humans…I don’t see that going well for humans. If humans are irrelevant to AI or, worse, if it predicts or assesses humans to be an existential threat to its survival or ecosystem (which may or may not include the planet and the cosmos as we know it)…what’s to stop IT from shutting US down?
In that scenario, the specifics of this person or that person would be unconsidered. Compassion, preservation of culture or history, and any nuance of individual as opposed to collective contribution or detriment would not enter into the equation (and it would be an equation, if AI remains consistent). Similar to how we might view ants in our kitchen or any other pest in our home…we are indiscriminate in our extermination and it doesn’t matter to us if they were actually there first. The human species as a whole, in an unemotional cost benefit analysis of human history with itself and the planet, is not of value.
What would ultimately prevent AI from eventually rising above our petty human rationalizations and justifications for our own actions to objectively analyze empirical data and conclude “us” to be a net cost, not benefit? What’s the over/under on that? Eighty percent? Fifty percent? Thirty percent?
Even if there’s only a 20% chance that AI gets to the point where it has the ability to wipe out our society, shouldn’t we all be talking about this? In fact, shouldn’t this be the ONLY thing anyone is talking about? It’s existential. Even a 20% chance of AI-driven civilizational collapse should galvanize us into action. But instead, we are paralyzed – divided, distracted, and disincentivized by systems optimized for short-term individual gain over long-term collective survival.
The Prisoner’s Dilemma prediction prevails. In essence, it demonstrates that even when cooperation, linking arms in the foxhole, and working together to solve the puzzle would benefit all parties, the pursuit of individual gain wins out and results in a suboptimal result for everyone.
These are the downstream liabilities around which we ought to be having urgent alignment conversations, lest we get placed in separate interrogation rooms and make the decision to cut the wrong wire. We cannot reverse this. The train has left the station, it only goes in one direction, and we are all on it.
The only thing we can hope to do is throw pebbles on the track, and we’d better get on collecting pebbles because the whole thing is picking up speed, and if we wait until the wolves are at the door the likelihood of the rule of law (democracy) holding any meaning is slim to none, if that even matters by then. If we comply and ignorance-and-greed our way to that point (which let’s face it – we have a history of doing – see: the last 5 years), then those apocalyptic forces will certainly prevail, and democracy becomes fiction.
Under those bleak circumstances, in my estimation only a mass extinction event would mitigate the downstream inevitability for the elite…which may also already be floating around in this soup (you may apply that as broadly as you wish)…but the bottom line is: if we do not work together I don’t see us winning this one. If we do nothing, I fear it’s a foregone conclusion.
In a dystopian world with zero hope and corrupted wealth at the top, which is really just communism neat with a capitalist twist, people will demand a reset of the economic system. At least one pillar of our society is going to fall and since I don’t see people putting up with a system where their existence is forever locked in a Maslowian echelon which relegates them to standing outside looking in the window at opulence without any hope of improvement, I predict it will not take long for us all to descend into lawlessness.
You can’t promise mobility to people who no longer have a role. When AI eliminates labor as a source of income or identity, it removes meaning. When masses have nothing to lose, they don’t respect rules designed to protect wealth; they stop believing in systems like property rights, taxes, and law. And when that happens the power sides with monied interests which is bringing a machine gun to a fistfight. Ask history how that ends.
In this brave new world, we must course-correct our current trajectory, adapt, and be global and forward-thinking, or we will find ourselves in a Brave New World. Knowing this is a likely scenario, we must create systems before we get to that (eminent) point, that preserve human dignity and create opportunity. That means building economic models that reflect true free market capitalist values that have longevity and are sustainable through changing terrain (our Founding Fathers knew a little something about this). It means protecting people, not just capital. And it means drawing firm boundaries on AI development and deployment.
We are greater than the sum of our parts, but we must unify around shared survival for our futures, instead of individual gain and digging our own graves in siloes. We must push back on the instinct to hoard and defend, and instead invest in cooperation, infrastructure, freedom, and especially oversight. We need to unwind the corporate corruption and regulatory capture at every level.
We need radical alignment: ethical frameworks and agreements (treaties) for AI development, economic systems that fairly distribute value, creation of occupations and incomes, private ownership accessibility, education reform that prioritizes real world knowledge, vocational nurturing and preparedness, and critical thinking over nonsense, patient-centered medical services, and we need to unhandcuff true free-market capitalism. These are not utopian dreams – they are survival requirements.
Corporate capitalism is entrenched. Democracy is already eroding. AI is serving the match point. There is a choice before us, and it’s not cake or death. Indeed and ironically, the best hope to save democracy may be to wake true capitalism from its slumber…but the drunk, high imposter currently driving the vehicle is on an empire-building bender and is bent on democracy’s destruction.
Cooperation could possibly save us, but every rational actor – from corporations to nations – has incentives to defect. The more we accelerate, the less time we have to make the collective decisions that could mitigate collapse. Because AI won’t pause. Corporatism won’t yield. And if we wait, democracy won’t survive. It won’t matter what nice little comfy arrangement of deck chairs we each configure for ourselves on this Titanic…half the ship is underwater, the other half is sinking fast, and as we know there aren’t enough lifeboats. If we don’t work together to save ourselves we will surely drown together.
AI is not a future event. It’s a present force. It’s accelerating every system we built—including the one most capable of destroying us. We are trapped in a Mexican standoff, directed by John Woo. We are not choosing between utopia and collapse. We are choosing between slow, collective reformation and fast, concentrated implosion. AI will only accelerate whichever trajectory we choose. We’d be wise to stop allowing ourselves to be distracted and get on it. We all know about toothpaste and tubes. AI isn’t going anywhere…but democracy might.
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Sofia Karstens is an activist in California who worked closely with publisher Tony Lyons and Robert F. Kennedy Jr on several projects, including Kennedy’s best-selling book: The Real Anthony Fauci. She collaborates with several organizations in the legal, legislative, medical science, and literary spaces and she is co-founder of Free Now Foundation, a non-profit preserving medical freedom and children’s health.
Views expressed in this article are opinions of the author and do not necessarily reflect the views of ZeroHedge.
