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AI won’t destroy the economy. Stop stressing out.

2026-02-16 · 14:02 UTC ·Darius Foroux ·7 min read

Brief

Foroux presents a macro-labor argument that AI’s near-term effect is not to wipe out the economy but to normalize an overheated labor market after years of rising worker leverage. He ties the current mood to a post-2022 shift from tight labor conditions and high quit rates toward weaker hiring, citing roughly 6.5 million U.S. job openings in December 2025 and moderating wage measures as evidence that bargaining power is moving back toward employers. His central thesis is political-economic rather than technical: AI functions as a mechanism for lowering labor’s leverage, even if not deliberately orchestrated. He also pushes back on collapse narratives by emphasizing demand-side realities—firms cannot profit if mass unemployment destroys consumption—and by pointing to institutional stabilizers such as central banks and regulation. The most concrete section notes that AI adoption is gated by physical bottlenecks, including data-center construction, chip supply, electricity generation, grid upgrades, cooling, permitting, and skilled trades, which slows any instantaneous replacement of knowledge work.

Why it matters

Darius Foroux argues that AI is more likely to reset employer-employee bargaining power than trigger an economic collapse.

Key details

  • He links today’s AI anxiety to a labor-market reversal: after unemployment fell through the 2010s and the 2021–2022 “Great Resignation” boosted worker leverage, U.S. job openings reportedly cooled to about 6.5 million in December 2025, the lowest since 2020, while wage growth and the Employment Cost Index slowed through late 2025.
  • The article frames AI as a modern form of the “disciplining of labor,” arguing that firms may not have coordinated its release but are using it to restore control, reduce wage pressure, and make workers more compliant by reintroducing fear of replacement.
  • Foroux contends that broad economic collapse is unlikely because companies still need consumer demand; if AI-driven layoffs became too severe, governments, central banks, regulators, and corporate lobbying would act to protect the wider system.
  • A key practical constraint is physical infrastructure: large-scale AI deployment depends on data centers, semiconductor manufacturing, power generation, grid interconnections, cooling, land, permits, and skilled labor, all of which create long lead times and slow real-world labor substitution.
Cleaned source text

title: AI won’t destroy the economy. Stop stressing out.

author: Darius Foroux

content_type: newsletter

publication: substack.com

published: 2026-02-16T14:02:36+00:00

source_url: gmail://19c66c57b9e96110

word_count: 1538

It's so over. Or is it?

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AI won’t destroy the economy. Stop stressing out.

Darius Foroux

Feb 16

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You’ve probably felt it.

That weird, low-grade panic in the background. You sense it in your conversations with friends and co-workers.

Every week, there’s another post about “AI taking your job.” Another CEO interview. Another layoff headline.

Another chart that screams: WE’RE COOKED.

And if you’re a knowledge worker, it hits differently. Because you can actually imagine it.

But here’s what I think is really happening.

AI will not destroy the economy.

It’s here to reset the leverage that companies have.

Let me explain. First, some background.

The last decade flipped the power balance

After the 2008/2009 financial crisis, jobs were scarce. A lot of wealth got wiped out. That period trained people to think: be grateful you even have a job.

Then the world started to change slowly. More growth, more opportunities.

Over the 2010s, the labor market tightened every year. Unemployment fell steadily, and by 2022, it was at its lowest level in decades.

And what happens when workers feel confident?

They quit more. They negotiate harder. They demand flexibility. They stop tolerating bad managers.

The “Great Resignation” wasn’t a meme. Quit rates surged and stayed high. Even the BLS (Bureau of Labor Statistics) wrote an entire analysis on it.

Power moved from employer to employee.

That’s what made 2021–2022 feel like “screw the employer” season.

And that’s exactly what businesses always try to prevent long-term.

Then ChatGPT shows up at the perfect moment

In late 2022, ChatGPT came out. And that started a new age.

First people said, “It’s a tool.”

Then, “It’s coming for simple tasks.”

Now in 2026 the message is: “Nobody is safe.”

That’s not just an idea. Look at the data. Job openings have cooled hard. In the US, job openings in December 2025 fell to about 6.5 million, the lowest since 2020.

Wage pressure is cooling as well. The Employment Cost Index and wage growth slowed through late 2025, which is exactly what employers and central banks want when they’re trying to tame inflation.

So the “overheated labor market” story is now officially done.

And everyone knows it.

The conspiracy theory (and the more boring truth)

There’s a theory that corporations timed AI to discipline workers.

I don’t buy the “timed it in a boardroom” version. It’s hard to believe that all the CEOs came together and said, “Let’s unleash AI so we can scare our workers!”

But I do buy the incentives version.

When workers gain too much leverage, systems push back. Sometimes it’s a recession. Sometimes it’s offshoring. Sometimes it’s a new management playbook. Sometimes it’s technology.

There’s even a phrase for it in political economy called the disciplining of labor.

The idea is simple. High worker power squeezes profits, so capital looks for ways to restore control and reduce labor costs.

Whether AI was released for that purpose or just became useful for that purpose is debatable.

But the result is the same.

Fear is back in the building!

Upgrade to paid

Fear is an essential part of capitalism

Let’s be totally honest. Why do most people work hard?

Not because they love spreadsheets.

Because there’s a carrot and a stick.

The carrot is money, status, comfort.

The stick is: if you don’t perform, you lose your place.

When the stick disappears, effort drops. Negotiation goes up. Entitlement rises. And companies hate that because it means less profit.

So what’s AI doing right now?

It’s putting the stick back on the table.

I’ve heard the same thing you’ve heard. People are on edge. They show up more. They polish their output. They volunteer. They stop coasting.

CEOs love this.

But here’s the part most doomers miss.

CEOs don’t want to collapse the economy

If too many people lose jobs, demand drops.

And when demand drops, revenue drops.

Even if AI makes companies more efficient, it doesn’t help if customers can’t pay.

So there’s a balance. Businesses want labor cheaper and more compliant.

But they don’t want a consumer apocalypse or deep recession.

That’s why the “AI will tank everything” narrative doesn’t make sense.

If we were truly heading toward an economic collapse, the entire system would protect itself.

Governments, central banks, corporate lobbying, and regulation. Nobody with power is going to calmly watch the engine explode.

What we’re seeing looks more like normalization.

A reset of leverage.

Not the end of work.

The economy is like a living organism

People talk about AI as if it were the first technology to replace work.

It really isn’t.