Could an AI backlash undermine western democracy?
When I asked ChatGPT this question I was provided with a host of concerns: the potential for AI to spread misinformation, cause election interference, or amplify bias through polarisation and manipulation. The fact is, the truth, when it comes to AI, has versions; the story you get depends largely on which engine you decide to engage. But the issues surrounding AI and its potential impact on democracy go way beyond simply defining what’s true.
To begin with, AI’s future energy needs are huge and it remains unclear who will be paying for them. The left-leaning educational model is no longer fit for purpose, politically or economically, churning out degrees for jobs that are well on their way to extinction. Data sovereignty is evaporating, and financial markets are struggling to deal with the cloud of mist around AI.
At a recent finance and investor day summit I hosted in London, tariffs, taxes, geopolitics, the forthcoming Labour budget and even the bond market all seemed less captivating for the C-suite audience than our hour-long conversation on the impact of AI.
The discussion ranged from the impact of high electricity prices at home to the implications of AI sovereignty lost. Inevitably, the talk turned to what artificial intelligence will do to the job market and how governments are preparing to absorb the forthcoming wave of the unemployed. None of us left the room feeling optimistic that the West fully grasps the enormity of these problems.
To begin with, the rise in electricity prices in the US has already put pressure on incumbent politicians. States with high electricity costs like New Jersey and Virginia have seen Democratic wins in recent elections. While most Democrats are putting the blame squarely on Big Tech and the buildout of AI infrastructure, Republicans have been slow to push back, betting that a patriotic desire to win the AI race with China will somehow alleviate Americans’ very real concerns as they watch their bills increase.
This narrative is dangerous for both parties, and sustainable, long-term policies will require a bipartisan approach. Yes, from a western perspective the race with China must be won. But those who run the engines America is empowering to win that race must also pay for the privilege to serve. I’m talking about Big Tech and the energy companies they are investing with to fuel the AI boom. As tech and energy companies see their power and profits increase, governments ought to demand that they shoulder more of the bills.
Across the pond, a major issue facing western governments is one of data sovereignty. US President Donald Trump’s tariffs, his attitude towards Russia and his demands on Nato have increased Europeans’ distrust of their traditional ally. With the UK and Europe largely dependent on the US for the tech, energy and materials needed to compete in the AI race, the continent runs the risk of being caught out, without leverage and without choice.
Remember, Russia’s gas war with Europe began well before Moscow’s invasion of Ukraine. And while US energy exports to Europe have been swift to alleviate much of that pain, the continent is nowhere near able to support the buildout of AI data centres and infrastructure in the way America or China can – not to mention produce the number of chips necessary to succeed.
As far as the future of employment, when I quoted Google’s ex-chief executive Eric Schmidt who told me that for every job lost to AI, two would be created, a scant show of hands around the room and the scepticism of my fellow panelists suggests that scenario is wildly optimistic.
McKinsey, a consulting firm, recently predicted millions of jobs will be lost in the 2030s, mostly in white collar fields. Western governments have so far done nothing to suggest that they are prepared to take on the welfare of the college-educated masses who could become jobless.
And too few western universities are churning out new curricula, nor are enough parents pushing their children to forgo elite institutions in favour of vocational training. Social safety nets may have widened in recent years, but they will not stretch to supporting the millions of people AI could displace.
Meanwhile, we are in the midst of an AI bubble that experts warn is increasingly unsustainable. Overvaluation, hype-driven investments and a lack of tangible returns should be haunting venture capitalist investors as much as those in government responsible for regulating markets. But between the politicians and the tech bros, no one seems to be factoring in the political instability AI could unleash.
