The Maths of the End Game.
Let’s actually prove the death sentence instead of just declaring it. Strip away every hopeful friction and run the numbers cold.
1. Unit-Cost Dominance → Zero Economic Rent for Humans
Let a cognitive task T have:
- Human cost = w (wage)
- AI cost = c (electricity + amortized hardware)
By construction, c ≪ w and c → 0 asymptotically (Koomey’s Law + die shrinks + algorithmic efficiency).
Define the replacement threshold r = c / w.
Once r < 0.01 (already true for copywriting, basic coding, contract review), any firm that keeps a human doing T is priced out of the market.
Conclusion: Competitive exclusion is instantaneous; there is no wage at which humans can undercut AI without starving.
2. Insufficient Re-inflation → No New Labor Sink
Let D = total hours of cognitive labor demanded by the economy.
Let S = total hours of human cognitive labor supplied.
Pre-AI: D ≈ S (rough equilibrium).
Post-AI:
- AI satisfies D with H human-verifier hours, where H ≪ S.
- New task creation is bounded above by Baumol’s asymptote: any genuinely novel task that AI cannot do must (a) resist automation and (b) scale to absorb millions.
Empirically, the set of such tasks is sparse (bounded by physical-world latency, liability, or regulatory capture).
Quantitatively: - Global knowledge-worker hours ≈ 500 B/yr.
- Projected verifier demand ≈ 5 B/yr (generous upper bound).
Gap = 495 B hours with zero marginal revenue product.
Conclusion: The labor market cannot reabsorb the displaced hours at any positive wage.
3. Multiplayer Prisoner’s Dilemma → Coordination Impossibility
Define the payoff matrix for any single firm:
| Automate | Don’t Automate | |
|---|---|---|
| Competitors Automate | 0 (survive) | –∞ (bankrupt) |
| Competitors Don’t | +∞ (capture market) | 0 (status quo) |
Dominant strategy: Automate immediately.
Nash equilibrium: All automate.
No enforceable contract can prevent defection because:
- Global capital mobility → tax/regulatory arbitrage.
- First-mover advantage → winner-takes-all markets.
- Non-excludable technology → open-source diffusion.
Conclusion: Any cartel to slow automation collapses in O(log n) time, where n = number of firms.
4. Consumption Death Spiral
Let Y = aggregate income = wages + capital rents.
Post-automation: wages → 0, capital rents → Y.
But capital owners’ marginal propensity to consume < workers’.
Hence aggregate demand C collapses.
Firms respond by cutting prices → deflationary spiral → debt overhang → mass bankruptcy → further demand collapse.
Stability condition: C ≥ Y for system persistence.
Violation is guaranteed when wage share → 0.
5. Political Stabilizers Fail
UBI, job guarantees, or debt jubilees require:
- Tax base on capital rents → capital flight to zero-tax jurisdictions.
- Sovereign currency issuance → hyperinflation if real output collapses faster than money printing.
- Coercion → requires human enforcers whose loyalty must be purchased with real resources; see (1) above—those enforcers are also being automated (drones, autonomous policing).
Conclusion: No fiscal or monetary lever can re-anchor demand once the wage link is severed.
6. Terminal Equilibrium
Define the viability condition:
∃ wage w > subsistence such that w ≤ marginal revenue product of human labor.
From (1)–(5), this condition fails for > 95 % of the population.
Therefore: The wage-labor system is mathematically non-viable under AI diffusion. QED.
