Engels' Pause and AI: why efficiency gains don't equal value creation
oran_ge · x · 2026-10-17
Drawing on the NYT report "Silicon Valley Is Preparing for a Permanent Underclass" (50+ researchers/economists interviewed), the author argues efficiency ≠ value: value comes from matched transactions, so 10x programmer productivity means job losses and fewer transactions, not more social value. Universal 10x cost cuts fail too—if every factory cuts prices, demand stays flat. Historical parallel: Britain's Engels' Pause (1780-1840) saw output up 50% while real wages rose only 10%; unions weren't legal until 1871. AI's displacement of white-collar software jobs may follow the same pattern. Includes a companion podcast episode.
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