In the rapidly evolving world of artificial intelligence, economists are sounding alarms about a future where machines could render human labor obsolete, potentially reshaping global economies in profound ways. Anton Korinek, a professor at the University of Virginia’s Darden School of Business, recently shared stark warnings in an interview with the Institute for Business in Global Society at Harvard Business School. He predicts that artificial general intelligence (AGI)—systems capable of performing any intellectual task a human can—might arrive within two to five years, leading to widespread job displacement and a fundamental breakdown in how societies distribute wealth.

Korinek argues that as AI advances, it will substitute for human workers across most sectors, driving wages toward zero. “AGI will soon do essentially anything that a human worker can do,” he explained, making humans “easily substitutable by AI.” This substitution crisis isn’t hypothetical; recent reports from the San Francisco Fed highlight Korinek’s presentations on how transformative AI could slash the cost of intelligence and labor to near-zero levels, echoing sentiments in a YouTube discussion where he described a “$100 trillion question” of economic revolution.

The Looming Substitution Crisis

The implications extend beyond individual jobs to the core of economic systems built on human labor as the primary mechanism for resource distribution. If AI handles tasks more efficiently and cheaply, Korinek warns, labor market values will plummet, leaving billions without livelihoods. This view aligns with findings from the National Bureau of Economic Research, which explores policy challenges in an AI-dominated era, noting potential disruptions that could exacerbate inequality.

Moreover, Korinek emphasizes the need for radical interventions like universal basic income (UBI) or shared capital ownership to redistribute AI-generated wealth. Without such measures, the concentration of gains among AI owners and companies could spark massive unrest. Posts on X (formerly Twitter) reflect growing public anxiety, with users like economists and tech influencers discussing how AI might wipe out white-collar jobs by 2027, leading to unemployment rates as high as 20% and calls for UBI to mitigate poverty.

Systemic Breakdown and Redistribution Imperatives

Failing to address this could trigger political instability, as mass unemployment erodes social stability. Korinek points to historical precedents where technological shifts caused upheaval, but AI’s scale is unprecedented. A recent article in The Economic Times echoes this, quoting experts who predict 15 years of job loss and inequality unless governments implement regulations and support systems like UBI.

Korinek’s role advising major AI firms, as reported by the University of Virginia Darden School, underscores his influence in shaping these discussions. He advocates for education focused on leveraging AI as a “force multiplier,” urging workers to master tools that amplify human capabilities rather than compete directly with machines.

Navigating Stability Threats and Skill Shifts

The path forward involves proactive policy: taxing AI-driven profits to fund UBI, as suggested in analyses from independent economic blogs and echoed in X conversations about an “AI tax” on transactions. Korinek’s insights, drawn from his work with institutions like the Brookings Institution, stress that while AI promises immense productivity gains—potentially adding trillions to global GDP—the benefits must be broadly shared to avoid collapse.

Industry insiders are already adapting; companies are investing in AI upskilling programs, recognizing that human-AI collaboration could define the next era. Yet, as Korinek notes in his Harvard interview, preparation is urgent: “Artificial superintelligence is inevitable. How we build it and what we do with it will be all that matters.” Without equitable redistribution, the economic boon could devolve into chaos, with geopolitical tensions rising as nations race to dominate AI, per reports from The Outpost AI.

Toward a Resilient AI-Driven Economy

Ultimately, the challenge is to transition from labor-centric models to ones where abundance is accessible. Korinek’s predictions, supported by recent NBER papers and Fed events, paint a picture of opportunity amid peril. For business leaders, the imperative is clear: invest in AI literacy now, advocate for policy reforms, and ensure that technological progress serves humanity broadly. As global discussions intensify, the decisions made in the next few years could determine whether AI ushers in prosperity or profound division.