Could AI really destroy capitalism?

Balancing Capital and Labor in the Age of AI

For centuries, the story of capitalism has revolved around how the rewards of production are divided between capital (owners of machines, tools, and technology) and labor (people who do the work).

That balance — the labor share of income — is what allows capitalism to function. Workers earn wages, buy goods, and sustain demand; capital earns returns that fund investment and innovation. The system works only when both sides participate.

If capitalism requires a balance between capital and labor (profits and wages), and AI removes labor entirely from production, then that balance collapses. Without workers earning income, there are no consumers to buy goods, no competition for wages, and no mechanism for markets to distribute wealth through work. At that point, what remains may look like capitalism in name, but it’s functionally something else. It is certainly not the capitalism of Adam Smith or John Maynard Keynes.

A world where AI eliminates labor and concentrates wealth in a few hands defies both of their visions—it turns markets into monopolies and citizens into dependents.

Here’s how most economists and political theorists would frame that “something else”:

1. Techno-Feudalism

That “something else” is what many now call techno-feudalism. If ownership of the new “means of production”—AI, data, and compute—rests with a small elite:

A few “lords” (AI owners and platform monopolies) control the infrastructure of life and commerce.
The rest become “serfs,” dependent on renting access to digital tools, data, or AI services.
There is no real labor market, because labor itself has been automated away.
Instead of wages, people receive credits or allowances—grants of subsistence rather than earned income.

This isn’t capitalism—it’s a digital feudal order masquerading as one.

2. Post-Capitalist Rent Economy

Even if markets remain in name, they become markets for access, not markets for production. Value flows through rents and subscriptions instead of wages and competition. Productivity rises, but ownership of that productivity narrows. The invisible hand becomes an invisible algorithm.

3. The RAISE-UP Response

RAISE-UP exists to save capitalism from collapsing into techno-feudalism by:

Keeping human work at the center of value creation.
Broadly sharing AI’s productivity gains.
Re-anchoring capitalism in human dignity, demand, and participation.

In short:

Without labor, there is no capitalism. Without sharing, there is no society. RAISE-UP ensures AI strengthens, rather than replaces, the social contract that Smith and Keynes believed made capitalism worth preserving.