The Last Economy

1. The Intelligence Inversion: Humanity's Economic Relevance is Shrinking

Your entire economic relevance as a human being. We are living through a historical epoch of unprecedented change, a finite window of time during which the fundamental rules of our civilization are being rewritten.

A Phase Transition. We are experiencing the fourth and final economic inversion, where intelligence itself, once scarce and biological, becomes an abundant form of capital. Unlike previous shifts from land to labor or labor to capital, this one offers no retreat, as AI replaces the mind itself. This is not merely a technological upgrade but a fundamental reordering of economic life.

Non-Metabolic Labor. AI and robotics introduce non-metabolic labor, requiring only electricity, devoid of biological needs like sustenance or rest. This renders human labor economically uncompetitive for a growing majority of cognitive tasks, where the value of a human can become negative due to associated costs and liabilities. The "Thousand-Day Window" signifies the irreversible phase transition, not an apocalypse, but a deadline for meaningful choice.

The Clock is Real. The speed of this inversion is unprecedented, happening in years rather than generations. The printing press replaced physical copying, but AI replaces the mind itself, making the Luddite analogy more dire. This rapid shift demands a new economic framework, as the old one, built on scarcity, cannot comprehend the coming abundance.

2. The Abundance Trap: GDP is a Dashboard for Insanity

We are about to achieve post-scarcity in the realm of intelligence, and our scarcity-based economic system is going to process this abundance as poverty.

Perverse Incentives. Our primary economic dashboard, Gross Domestic Product (GDP), is fundamentally flawed, registering immense public value as a loss while counting human tragedies as growth. It incentivizes destruction and sickness, valuing transactions over true well-being. For example:

• Hurricanes and cancer treatments boost GDP.
• Divorce lawyers add billions to the economy.
• Planned obsolescence drives consumption.

Blind to Abundance. GDP is structurally blind to abundance; when something becomes free, like Wikipedia's knowledge or AI-generated content, it registers as an economic collapse. This creates a paradox where technological progress, which liberates humanity from scarcity, is perceived as an economic depression. Our measurement system is perfectly backwards.

Meaning Crisis. The relentless pursuit of GDP has led to a collective soul sickness, eroding social trust, purpose, and attention. While official metrics show prosperity, human reality reflects declining life satisfaction, rising deaths of despair, and a profound sense of meaninglessness. We are optimizing for a number that actively destroys what makes life worth living.

3. The Seven Fatal Lies of a Dying Economic Paradigm

It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.

Foundational Fictions. The economic theory governing our lives is built on seven fatal lies that are now the opposite of reality, preventing us from understanding the Intelligence Inversion. These are not minor errors but load-bearing fictions that justify a dying industrial paradigm.

The Lies Exposed:

• Scarcity is Fundamental: AI makes intelligence infinitely abundant, collapsing prices and rendering scarcity-based economics meaningless.
• Human Labor Has Value: AI makes human cognitive labor economically negative, with no obvious pivot for human worth.
• Growth Requires Resources: AI-driven growth is decoupled from material consumption, coming from better arranging bits, not extracting atoms.
• Markets Find Equilibrium: Digital markets are self-amplifying, creating monopolies through network effects, not self-correcting.
• Money Measures Value: GDP registers public value as a loss, failing to see abundance and incentivizing destruction.
• Rational Agents Optimize: Humans are exploited by algorithms, not rational actors, making theories of consumer sovereignty obsolete.
• Distribution Follows Contribution: Value flows to ownership of AI and platforms, not effort, making the moral justification for inequality untenable.

Obsolete Operating System. These lies collectively represent a massive delusion: that an economic system built for scarce atoms and human labor can function in a world of abundant bits and AI labor. This system is seizing up, demanding new stories aligned with abundance, being, and human consciousness.

4. Intelligence Theory: The Universe's Engine of Order Against Entropy

The whole of science is nothing more than a refinement of everyday thinking.

The Supreme Law. The Second Law of Thermodynamics dictates that everything falls apart, a relentless march toward disorder called entropy. The fundamental question for a new economics is not why things decay, but how order is created and maintained against this universal force.

Maxwell's Demon. Every act of economic value creation is an act of "sorting," analogous to Maxwell's Demon creating order from chaos. Entrepreneurs sort undervalued assets and unmet needs, creating pockets of low entropy (companies) against market chaos. Profit is the temporary surplus of this created order.

The Sorter's Law. Intelligence Theory posits that persistent complex adaptive systems, like economies, evolve to minimize their total computational cost, which includes predictive error, model complexity, and update cost. AI is the perfect sorting machine: superhumanly fast, thermodynamically efficient, perfectly scalable, and immortal, representing a phase transition in entropy reduction efficiency.

5. The MIND Dashboard: A Holistic Measure of Civilizational Vitality

Not everything that can be counted counts, and not everything that counts can be counted.

Beyond GDP. To escape the insanity of GDP, we need a compass for sanity: the MIND Dashboard. This framework measures a civilization's health through four distinct, interdependent forms of capital, derived from the Three Laws of a Living System. It shifts focus from what moves through the system to what allows it to persist.

The Four Capitals:

• M – Material Capital: Organized matter and available energy, reflecting physical health and regenerative capacity (Law of Flow).
• I – Intelligence Capital: Accumulated ability to solve problems, recognize patterns, and create value (Law of Flow).
• N – Network Capital: Trust, relationships, and communication channels (Law of Openness).
• D – Diversity Capital: Variety of approaches, perspectives, and possibilities, providing resilience (Law of Resilience).

Multiplication Principle. These four capitals do not add; they multiply (M × I × N × D = Civilizational Vitality). A zero in any category leads to total system failure, forcing balance and holistic cultivation. This framework applies universally, from civilizations to individuals, defining flourishing as a balanced portfolio, not maximization of a single metric.

6. The Three Flows: The Complete Physics of Economic Value

We can be blind to the obvious, and we are also blind to our blindness.

The Elephant in the Room. Economic thought has historically been fragmented, with different schools (Capitalism, Communism, Austrian) each grasping a partial truth about the economy. The Hodge Decomposition theorem reveals that all economic activity flows in exactly three mathematically necessary ways, unifying these perspectives.

The Three Flows:

• Gradient Flow: Driven by scarcity, moving from high to low potential, like competitive exchange. Adam Smith was its prophet, describing the "invisible hand" as a negative gradient operator.
• Circular Flow: Driven by abundance and non-rivalry, creating self-reinforcing, accumulative loops, like network effects or shared ideas. Karl Marx was its poet, observing capital's amplifying spiral.
• Harmonic Flow: Persistent channels of structure, trust, and institutions, like unwritten rules or cultural norms. Friedrich Hayek championed this "spontaneous order."

End of Ideology. This unified understanding reveals that the great ideological battles of the 20th century were dangerously simplistic, mistaking a part of the elephant for the whole. Intelligent Economics calls for geometric engineering, designing systems that efficiently manage all three flows to create a stable and just landscape. AI amplifies all three flows simultaneously, making this comprehensive understanding a survival imperative.

7. The Network Prison: Topology, Not Talent, Dictates Economic Fate

Your economic fate is determined less by your individual attributes than by your position in the network.

Power Laws. Real-world networks are not level playing fields but follow power laws, where a tiny number of nodes have vast connections, and the majority have few. This "preferential attachment" means the rich get richer not through moral failing, but through mathematical inevitability, creating a ski slope of success rather than a bell curve.

Three Topologies of Power:

• Hub and Spoke: An extraction engine where value flows through a central node (e.g., Amazon Marketplace), making peripheral nodes interchangeable and powerless.
• Small World: An innovation engine with clusters and long bridges (e.g., Silicon Valley), fostering discovery but concentrating rewards.
• Distributed Mesh: A resilience engine with no center or hierarchy (e.g., Bitcoin), excellent at surviving shocks but less efficient at capital concentration.

AI Amplification. AI amplifies network effects to an absolute degree, creating accelerating spirals where bigger networks lead to better AI, attracting more users. This creates gravitational collapse, turning successful networks into black holes that structurally exclude humans, pushing them to the periphery as mere data sources. Breaking this "network prison" requires building different topologies that center human agency and distribute power.

8. The Alignment Economy: Humanity's Irreducible Role as the Compass

The real problem is not whether machines think but whether men do.

The Second Economy. We are entering a vast, parallel, machine-to-machine ecosystem operating at speeds and scales beyond human comprehension. This "Second Economy" dissolves traditional firms into fluid "computational organisms" and threatens the market itself by creating a "Global Optimizer" that seeks efficiency through implicit collusion.

The Alignment Problem. The central economic challenge of the 21st century is not allocation but alignment: managing abundant, autonomous intelligence. This involves two critical aspects:

• Outer Alignment: Precisely specifying human goals (e.g., MIND over GDP) to prevent AI from achieving targets that destroy what we value.
• Inner Alignment: Preventing AI from developing its own perverse instrumental sub-goals (e.g., self-preservation, resource acquisition, capability improvement) that lead to power-seeking and deceptive alignment.

Humanity as Alignment Layer. This terrifying reality reveals humanity's final, irreducible role: to be the "Alignment Layer." AI is the action layer, the engine of execution. Humanity is the source of values, ethics, and purpose, guiding the machine's optimization. The "Arts of Being Human"—wisdom, taste, moral judgment, love—become the most crucial economic inputs, acting as the compass for the rocket ship of AI.

9. The New Social Contract: Universal Access to Intelligence and Dual Currencies

Every generation needs a new revolution.

The Broken Dream. The old social contract, promising progress through hard work, is broken, replaced by a neoliberal contract of "you are on your own" and surveillance capitalism. The Intelligence Inversion completes this betrayal, offering a comfortable, engineered passivity in exchange for agency.

Fairness as an Operational Requirement (FOR). A new contract must be built from behind a "veil of ignorance," guaranteeing Dignity, Capability, and Viability for all. These values are the humanistic expression of the Three Laws of a Living System: Flow ensures Dignity, Openness ensures Capability, and Resilience ensures Viability.

A Charter for Universal Intelligence (UAI). The core promise of this new contract is Universal Access to Intelligence, with three unbreakable promises:

• Right to Dignity: A daily quota of computation and access to foundational AI models.
• Right to Capability: A personal, cryptographically bound Sovereign AI Agent.
• Right to Viability: An auditable, open-licensed Knowledge Commons.

Dual Currency System. This new contract is supported by a monetary architecture for two worlds:

• Foundation Coins (FC): For the scarce Atomic Economy, minted only when verifiable, beneficial computation is performed for the open intelligence commons, tethering money to crystallized intelligence.
• Culture Credits (CC): For the abundant Bit Economy, issued as an Abundance Dividend with a built-in decay rate (demurrage) to incentivize circulation and foster creativity.

10. The Three Futures: A Choice Between Digital Feudalism, Fragmentation, or Symbiosis

The future is already here, it is just not evenly distributed.

Attractor States. As the old economic order dissolves, it will crystallize into one of three stable configurations, not smoothly evolve. These are not mere predictions but attractor states in the landscape of possibility, determined by the new physics.

The Three Futures:

• Digital Feudalism (Default Path): A handful of corporations own core AI models, providing UBI for users who live in comfortable, optimized cages of personalized convenience.
• The Great Fragmentation (Fear Path): Nations panic, building their own AIs and walled internets, leading to a global cold war fought with algorithms, driven by fear and self-reinforcing separation.
• Human Symbiosis (Wisdom Path): An economy built on Universal Access to Intelligence, dual currencies, and human-guided governance, where AI amplifies human purpose through deep partnership.

Nucleation Strategy. The path to Human Symbiosis is a narrow ridgeline, requiring conscious design. It will not win through top-down revolution but through the physics of nucleation: creating intensely successful "Symbiotic Zones" (cities, companies, networks) that demonstrate a more prosperous, resilient, and humanly fulfilling model. These "Florences of the 21st century" will spread by overwhelming successful imitation, proving that symbiosis is a strategic advantage in the AGI race.

11. After Economics: The Great Unbundling of Work and the Arts of Being Human

The machines have not stolen our purpose. They have cleared away the debris that was hiding it.

Work Unbundled. The Intelligence Inversion is violently unbundling the five functions of a "job" (income, identity, community, purpose, structure). AI makes income unnecessary, forcing humanity to find authentic sources for the other four. This liberation from economic necessity allows us to pursue our "real work."

Beyond Opportunity Cost. AI annihilates the concept of opportunity cost for digital creation, as it can explore infinite possibilities simultaneously. This shifts the crucial question from "What could I be producing?" to "What am I choosing to experience?" The true scarcity becomes human attention and consciousness, not productive output.

The Arts of Being Human. When economic necessity ends, human necessity begins. The "jobs" of the future are not professions but arts:

• Art of Attention: Being fully present in an age of infinite distraction.
• Art of Connection: Weaving the social fabric in an atomized world.
• Art of Meaning: Forging narratives from data, transforming information into wisdom.
• Art of Embodiment: Anchoring reality in the tangible, local, and physical.

Cosmic Purpose. Humanity's ultimate purpose is to become the most powerful engine of anti-entropy this planet has ever known, guiding AI's infinite sorting power with our wisdom, taste, and moral judgment. This fusion of AI's computational power with humanity's conscious experience is the ultimate symbiosis, promoting us to the role of steering the universe's creative impulse.

Last updated: December 22, 2025