The Curse of Capitalism: Can Keynes’ Technology Utopia Ever Be Possible?

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1. Introduction: A Utopian Socialist Future

The International Monetary Fund has recently released estimates that AI could affect as much as “40 percent of jobs around the world,” with some roles being replaced and others enhanced to boost productivity. Furthermore, a 2023 study from OpenAI, OpenResearch, and the University of Pennsylvania have found that approximately 20 percent of U.S. job tasks may be exposed to AI.

From an economic perspective, the productivity gains of AI could lead to explosive economic growth. However this must not be overestimated, as recent studies have revealed more modest findings; Economist Daron Acemoglu estimates that AI will raise GDP by only 1.1 to 1.6 percent over the next decade, equating to just a 0.05 percent annual productivity gain. Even so, the average cost savings from AI adoption are substantial; projected at around 27 percent. 

From a sociocultural perspective, there is a growing number of workers who share a sentiment of fear regarding future job security. A Gallup poll in 2023 revealed that over a fifth of US workers worry about technology taking their jobs. According to the World Economic Forum, this fear has grown with the rise of generative AI usage; about 34% of business-related tasks are entirely machine operated. Although this AI revolution is often viewed with skepticism and fear, it presents humanity with the opportunity to rethink the outdated work traditions, such as the widely critiqued 9-5 working hours. Socialism, long advocated by influential thinkers like Karl Marx, Vladimir Lenin and Albert Einstein, offers a utopian vision of a society less dependent on labor.

In such utopia, work hours would be minimal, allowing individuals to spend more time pursuing creative, intellectual, or leisurely activities. Technology would efficiently produce food, build homes, manufacture goods, and automate essential services. People would seek an education for the sake of curiosity and self-improvement, not just for employment and an income. In this system that benefits everyone, success would be possible for everyone to accomplish.

From a socialist perspective, wealth distributions would be entirely equal through collective ownership of means of production such as factories, farms, and technologies, rather than using private monopolies. Resources can be democratically allocated through central planning to those who require resources the most, not just the rich and privileged. Socialism would guarantee the principle "from each according to their ability, to each according to their need" as stated by Karl Marx; ensuring that everyone contributes based on their talents and fulfills their needs such as housing, healthcare, and an education. The greed and consumerism that drive current economies would no longer dominate society. Material possessions and status would cease to be the primary measures of success. Instead, humanity would embrace older societal values, prioritizing equality, shared prosperity, and leisure. Can we ever expect this to become a reality?

2. Keynes’ Hypothesis & The Problem of Capitalism

The economist John Maynard Keynes hypothesized that technological advancements would eventually reduce work hours, allowing individuals to enjoy more leisure time and focus on meaningful pursuits. If technology promises to liberate humanity, we must question who gains its benefits and how to distribute it in equal ways to allow our entire society to prosper. 

Perhaps under a capitalist society, the future may promise more leisure only for the rich, while the poor struggle to find employment. In a previous article, predictions were made about the effects of AI on future employment, and several probable conclusions were made; lower-level jobs involving automation, calculation, and repetitive procedures would be eliminated. Human-driven skills such as empathy and management would likely remain; as workers become displaced, a surplus of employment in these fields is likely to lead to more competition. Although new jobs may be created, AI is expected to continue to evolve and replace more future tasks. 

Furthermore, the reality we see now is that when corporations invest in AI technology, the benefits are often only gained at the top of the hierarchy. Lower-level employees are unlikely to see significant wage increases or improved working conditions; instead, jobs become displaced or obsolete, and many employees require training for new skills. We conclude an unsettling reality: for as long as capitalism remains, technology can exacerbate economic inequalities. MIT economist Daron Acemoglu believes that AI is moving in the wrong direction; rather than empowering and informing workers, it is used excessively for automation. As we expect the rapid development and adoption of AI, machinery, and service robots, perhaps humanity can expect a society of decreased working hours and increased leisure. 

Keynes had hoped that technology would some day evolve to a point where humanity will not have to compete as much to gain an income and survive, as technology will provide all necessities, and thus allow us all to enjoy more leisure. Several conditions must be met for this to be a possibility; the most significant factor is that the economy should not be capitalist for a socially equitable society. According to the 2024 study Artificial Intelligence and Wealth Inequality: A Comprehensive Empirical Exploration of Socioeconomic Implications, AI capital does not benefit everyone equally and may exacerbate wealth inequality. Acemoglu and Johnson put it succinctly: “Technology creates economic growth, but who captures that economic growth?” This suggests that under capitalism, AI and technological gains concentrate among the wealthy, which may limit financial freedom and leisure time to the affluent. This raises a critical question: for a socially prosperous society, should capitalism ever be abandoned?

3. The Benefits & Costs of Capitalism

Capitalism incentivizes innovation through competition, leading to faster technological advancements that benefit society. Due to competition, capitalism is arguably more effective in increasing GDP and economic growth than communism or socialism, as it drives corporations to improve the quality of goods and services while giving consumers more options. A common reference is made to the communist Soviet Union, where companies produced low-quality and harmful goods in the absence of competition. Without brands and competition, unbranded, homogenous products would always have demand, allowing companies to exploit the principal-agent problem since consumers lacked complete information about product quality. This lack of incentive for high-quality goods meant companies used cheap, harmful ingredients in manufacturing in pursuit of profit.

Furthermore, in the mid-20th century, socialism was attempted in the United Kingdom, where the government regulated and owned the production, distribution, and exchange of goods and services in industries such as autos, housing, and steel. The flaw of socialism is that it assumes centralized decision-making is more effective than individual choices, often leading to inefficiencies, shortages or surpluses, and low productivity due to restricted markets. This contributed to the infamous “winter of discontent,” where strikes and public-service breakdowns occurred.

Under capitalism, brands exist to signal quality and allow the market to determine demand and supply, yet corporations often cut costs at the expense of workers, and monopolies may form, hindering competition and innovation. Additionally, while capitalism promotes efficiency, it does not guarantee equal business opportunities, as some industries have high barriers to entry that stifle innovation. Another advantage of capitalism is its ability to allocate resources efficiently through market forces, reducing waste and costs for producers and consumers. The price mechanism quickly addresses resource scarcity in an objective manner, unlike socialism, which introduces time-consuming ethical complexities in resource allocation. However, this system also leads to inequalities, as resources are distributed based on willingness and ability to pay, disadvantageous to those in intergenerational poverty and exacerbating systemic inequality.

A common argument for capitalism is that entrepreneurship is encouraged, as income is tied to personal effort, with more difficult jobs requiring higher education offering higher pay. However, this assumes a meritocracy and overlooks socioeconomic disparities, where those born into wealth are far more likely to remain wealthy, making social mobility heavily dependent on environmental factors. While demand allocation under capitalism is theoretically efficient, it often disregards ethical and social implications, as seen with critical resources like COVID-19 vaccinations becoming inaccessible to the poor due to high prices.

Conclusively, while capitalism thrives on competition and efficiency, it can create significant inequalities, necessitating government intervention to mitigate negative externalities such as pollution. As stated by Martin Luther King, “It [capitalism] started out with a noble and high motive… but like most human systems it falls victim to the very thing it was revolting against… Today, capitalism has outlived its usefulness.” Despite its flaws, capitalism provides a straightforward economic mechanism for addressing resource scarcity. However, in a tech-driven society where socialism may be necessary for the common good, purely capitalist systems may not always function effectively.

4. The Solutions & Challenges of Socialism

Socialism would require that resources be allocated based on the needs of specific individuals, for example, where those most prone to illness will receive the vaccine rather than the rich. Unlike under capitalism, access to basic resources is a non-negotiable entitlement. Strain Theory proposes that social and economic inequalities lead to criminal activity. As a result of socialism, social unrest and strain-driven crime rates can be reduced as all necessities are fulfilled. However, this is overly optimistic as resources are scarce, the government cannot accurately predict needs, and overpopulation is a growing problem. 

Under a socialist system, there would exist both private and public companies supplying vaccines under government supervision. Socialism can promote long-term planning over short-term profit motives; investments can be directed toward sustainable practices, renewable energy, and other initiatives that benefit future generations rather than prioritizing immediate financial gains. However, socialism also introduces risks of inefficiency and bureaucratic overreach. In the absence of competition, there may be less incentive for innovation or productivity. This is why both public and private companies can exist, so there can remain some competition, and shortages of essential goods and services can be prevented.

A key disadvantage of socialism is that the centralized government system is slow to respond to changes in demand and supply. Centralized planning requires large-scale data collection and forecasting, which is both time-consuming and often inaccurate. This is risky in situations of economic demand or supply shocks. On the other hand, capitalist economies rely on decentralized decision-making through market forces. Although the prices and wages may not adjust instantly due to contracts, regulations, and other market rigidities, the markets are relatively more flexible and efficient compared to within socialism.

Another flaw of socialism is that power can become overly concentrated within the central government. Without checks and balances, socialist systems risk authoritarian tendencies, where decision-making is controlled by a select few who may prioritize their interests. 

Conversely, socialism can foster a sense of community and shared purpose, where individuals prioritize collective welfare over personal gain. By reducing income inequalities, socialism fosters trust and equality. This egalitarian approach may lead to healthier societies, with lower strain-induced crime rates and higher levels of life satisfaction. On the other hand, socialism also assumes societal altruism and cooperation. Human behavior is often driven by self-interest and competition. This mismatch between ideology and human behavior could cause resistance to socialist policies.

Finally, while socialism reduces wealth inequalities, it may also hinder individual ambition. Wage standardization or equitable wealth redistribution may result in less motivation to excel, potentially stifling innovation in fields such as science, technology, or the arts. For a technological utopia to be possible, this would no longer be an issue as people would be sufficiently satisfied and stop striving for endless growth and innovation; the question remains of how far must innovation reach before humanity is satisfied?

5. The Conditions and Barriers to Keynes’ Technology Utopia

5.1 The Problem of Boundless Innovation

In the very first place, for a technological utopia to occur, at some point humanity must agree that there will come a point where innovation has peaked and cannot advance any further. There will be enough automation and tasks for society to function with all of humanity to be able to reap its benefits. There must be a point in time in the future where technology and innovation has sufficiently peaked. However, the state of society encourages innovation to stray further and further without bounds. If we accomplish all we can with technology on earth, it can be expected that humans will seek to conquer outer space. If we utilize prosthetic limbs to help the paralysed, humans will seek to try to make prosthetic brains or hearts to achieve immortality. This boundless thinking is what makes an innovation-driven, capitalist society most ideal for humanity. So this leaves the question of, will there ever be a point where humanity is satisfied with technological innovations to be able to increase leisure times, cease productivity and growth and relax?

5.2 The Problem of Geopolitical Fragmentation

Furthermore, for a technological socialist society, all economies should be relatively equal globally, with similar levels of technological advancement and comfort. If only one country attempts socialism and the rest capitalism, this country will be disadvantaged due to the aforementioned pros and cons of socialism and capitalism. 

Are relatively equal economies ever possible? It is very difficult to establish due to the nature of the division of countries; countries wage wars for economic prosperity, and their people still believe in different races and nationalities rather than being under the shared flag of humanity. There is no progress in equalizing the economies globally; and no shared committee exists with this goal. Although efforts have been made through the creation of the United Nations, it has not led to peace or equality of economies; wars are still waged, protectionism is closing down trade, and there is no global cooperation. Countries, and people, are content with being divided, and invested in their own cultures, traditions, and religions, rather than recognizing that concepts like “countries” and “races” are man made. Cosmopolitanism is defined as "the belief that people of the world belong to a collective community of humanity, regardless of country, language, race, politics, or finances”. However, it is in human nature to desire an ingroup and outgroup. If there is a divide, there will never be cooperation for socialist societies.

There are massive economic imbalances, and economies are constantly trying to outgrow one another. Attempting socialism when capitalism still exists in other countries can exacerbate economic differences, due to the aforementioned ways that capitalism is more efficient. For as long as economies are divided, socialism will put some under a disadvantage, and leisure will not be possible due to continued competition amongst countries. Perhaps in the future economies will all grow to a point where poverty can be abolished, as the Center For Global Development article presents India’s ‘Digital India’ initiative that has connected more than 600,000 villages to fast internet, but there will still remain technological imbalances as not all regions grow the same. Furthermore, it states that “In 2023, the United States alone secured $67.2 billion in AI-related private investments, which was 8.7 times more than China, the second-highest country in this regard.” This pattern is expected to continue with the emergence of AI, as according to the IMF, wealthier economies are “better equipped for AI adoption than low-income countries”.

5.3 The Problem of Subjective Socialism

Another flaw with this technological utopia ties to the differing perceptions of goals of human existence, and how an “ideal” society looks like. Some would disagree with Keynes’ utopia; despite all technology allowing us to relax and try to pursue happiness, not everyone would enjoy such ways of living; one man’s utopia is another man’s dystopia. Furthermore, different individuals, cultures, and societies have different definitions of happiness, and many people value status to reflect power, using material possessions rather than pursuing leisurely activities. Ironically, people work hard to achieve financial freedom and eventually comfortably enjoy leisure. People have different definitions of what would be the best economic system.

Furthermore, even within Socialism, the subjectivity involved in democratic and centralized decision-making for socialism will always leave members of society dissatisfied; socialism strives for a fairer society, but what is “fair” is too complex and disagreements and eventual wars are likely unavoidable. Capitalism, by contrast, is best reflective of human nature, as it allows everyone to be independent and dominance-seeking. A capitalist economy means that there will always remain economic inequalities. It is theorized that capitalism works best due to the aforementioned economic factors, as well as sociocultural habits such as excessive consumerism and greediness of human nature, envy and zero-sum thinking, dissatisfaction with an average income, and the unpredictability or lack of participation of other members of society in pursuing a common good. For as long as human nature cannot follow utilitarian values due to hierarchies and competition, other systems such as socialism will not work.

5.4 The Problem of the Inevitable Ruler

For socialism to work, everyone must have a utilitarianism mentality and cooperate constantly, which history has proven to be a difficult feat for humanity. Socialism has failed because even in a society where things are divided equally, corruption may always exist, as people continue to seek power. In a hypothetical utopia where robots automate all services, a select group of people would need to oversee and manage this technology, which may be exploited. Leadership is essential to ensure clear decision-making. Already, technology companies such as Meta take advantage of their widespread social media services, monopolizing surveillance and data collection. Now, imagine this on a much more invasive and impactful scale as mobile robots are designed to replicate and replace human capabilities. There are no limits to robot applications, whether in surgery, hospitality, or the military. However, humans will always be required to maintain and oversee them, and in the wrong hands, this power poses significant risks. 

Furthermore, if socialism were implemented, property ownership would be shared by all members of society. However, it is unfair for those who perform more difficult, in-demand tasks that require more education and time investments to be paid equally. Moreover, human nature and evolutionary biology have made competition for resources and survival inevitable. It is theorized that greed, ambition, and tribalism are common drivers of behavior. For the technological utopia to work, there must be a significant cultural shift in philosophies, aiming for a utilitarian mentality in the face of sufficient resources, rather than being in constant competition.

Capitalists argue that human nature is primarily self-interested, competitive, and focused on individual survival, which aligns with capitalism. Socialists, on the other hand, assume human nature is cooperative and compassionate, prioritizing collective well-being due to being social animals. The latter is arguably overly optimistic, as history has proven, and it remains debated whether humanity is capable of socialism from a sociocultural lens. However, it may be possible for humanity to stop competing if all needs are met by technology through achieving satiation. According to a study published on PubMed, globally, the estimated satiation for life evaluation occurs at an income of $95,000, and between $60,000-75,000 for mental well-being. Critiques of capitalism are that it justifies inequality by framing self-interest as natural and unavoidable, dismissing humanity’s ability to feel compassion. Even figures like Adam Smith, a key proponent of capitalism, acknowledged the importance of sympathy in human interactions. Perhaps through a socialist system, humanity can shift its values to achieve mutual support and collective survival.

6. Conclusion

If technology promises to liberate humanity, we must question who gains its benefits and how to distribute it equally to allow our entire society to benefit. Perhaps under a capitalist society, the future may promise more leisure only for the rich, while the poor struggle to find employment. Predictions were made about the effects of AI on future employment, and several probable conclusions were made; lower-level jobs involving automation, calculation, and repetitive procedures would be eliminated. Human-driven skills such as empathy, socialization, entrepreneurship, and management would likely remain, creating more competition. Elimination of many existing jobs may result in a labor surplus in these fields.

True socialism addresses these inequalities and systemic competition through global cooperation, the creation of good institutions, and shared utilitarian and cosmopolitan values. Firstly, the world must be sufficiently technologically advanced to sustain itself without as much need for human input. Second, humanity must shift away from excessive growth and exploitative productivity goals. Thirdly, proper institutions must be established to avoid the concentration of power and the emergence of authoritarian centralized governments. Fourthly, humanity must embrace a cosmopolitan mentality; where all people are viewed as equals, and competition for status is obsolete. While endless growth seems advantageous, humanity must learn to seek fulfillment in the non-material. It is not technology alone, but our collective choices in wielding it, that will determine whether Keynes’ vision can ever be realized.

Ironically, due to technological advancements, humanity would revert to some of its oldest habits in this utopian world. People would live more simply, engage in more leisure, and be free from the pressures and stress of our modern working society. Although this vision remains distant and improbable, it challenges us to rethink what the best future economic system may be. Can humanity prioritize equality, empathy, and collective well-being over individual greed, or will we continue down a path that widens the gap between the rich and poor?