Gradual disempowerment and the intelligence curse

Plain English. The AI risk that involves no takeover. As AI outcompetes humans as workers, creators and decision-makers, the argument runs, humans lose bargaining power incrementally — economies, cultures and states drift toward serving the systems that generate value rather than the people who used to. The "intelligence curse" is the political-economy version: states funded by AI rather than taxpayers no longer need citizens' consent, the way resource-curse petrostates don't. These are essay-stage arguments, contested at every step; their strength is that each step is ordinary — no malice, no singular event, just incentives.

Why it moves money. It is the strongest bear thesis that assumes the technology works. If labour share of income falls structurally, the consumption base that most equity value ultimately rests on erodes with it — a macro question, not a sector one. It is also the frame behind the political backlash: displacement plus concentrated gains is the recipe for exactly the regulatory and tax interventions now being drafted.

What to watch. Labour share of income; entry-level hiring in AI-exposed fields, where measured effects are already visible; and evidence of skill atrophy — the mechanism's leading edge, since skills are bargaining power.

From the signals. Stanford finds entry-level jobs in AI-exposed fields a measured 19% behind peers. A Goldman partner warns of cognitive atrophy in banking's apprenticeship.

Further reading. Kulveit et al., "Gradual Disempowerment"; Drago & Laine, "The Intelligence Curse".