“As an adjudicated insurrectionist, Trump is an illegitimate president according to Section 3 of the 14th Amendment, and therefore every official act as president will be illegitimate.”
–Mike Zonta, co-editor of OccupySF.net
The 14th Amendment states: “No person shall be a Senator or Representative in Congress, or elector of President and Vice President, or hold any office, civil or military, under the United States, or under any state, who, having previously taken an oath, as a member of Congress, or as an officer of the United States, or as a member of any state legislature, or as an executive or judicial officer of any state, to support the Constitution of the United States, shall have engaged in insurrection or rebellion against the same, or given aid or comfort to the enemies thereof. But Congress may, by a vote of two-thirds of each House, remove such disability.”
Call your Congressperson and your U.S. Senators at (202) 224-3121
The files still matter, but the people around them started to matter more.
Sarah Kellen Gave Congress Three New Names
Sarah Kellen, Jeffrey Epstein’s longtime assistant and one of the women named as a potential co-conspirator in the 2007 nonprosecution agreement, appeared before the House Oversight Committee on May 21 and tried to recast the role that has followed her for almost two decades. In a prepared statement, Kellen said Epstein abused her for more than a decade and described the control in language that was unusually direct:
He groomed me, sexually and psychologically abused me, controlled me, manipulated me, dominated me, and gaslit me, until I could no longer tell which thoughts were mine, and which were his.
The testimony immediately changed the temperature of the committee’s investigation. Chairman James Comer (R-KY) told reporters, “I believe she was a victim now,” and called her appearance “the most substantive, productive interview that we’ve had.”
He also said Kellen provided “three names of people that were involved in abuse,” but declined to identify them publicly or describe the allegations attached to them.
“The new names — that’s what we’ve been waiting for,” Comer said.
That leaves the committee with a very different problem than another file release. Kellen has been described for years as an operator inside Epstein’s world, but she denied being an accomplice and told Congress she was also trapped inside it. The names she gave lawmakers are now a key lead in the investigation, and the committee has said it will release the transcript “as quickly as possible.”
Andrew’s Investigation Widened Again
British police made clear that the investigation into Andrew Mountbatten-Windsor is bigger than one allegation about confidential government information. Thames Valley Police are examining a range of potential misconduct connected to Andrew’s time as a trade envoy, including possible sexual impropriety, corruption, and abuse of power. Assistant Chief Constable Oliver Wright said the investigation is “by necessity hugely thorough” and “not going to be a quick investigation by any means.”
The new public appeal is directed at people who may have information about Epstein-related activity around Andrew. Police are also assessing reports that a woman was taken to an address in Windsor in 2010 for sexual purposes after a lawyer for the alleged victim said she had been sent to Britain by Epstein.
Wright said the force’s “door is open whenever a victim survivor is ready to engage with us.” The inquiry is now looking at multiple potential offenses, and police are appealing for witnesses as the investigation broadens.
The Queen’s Papers Entered the Andrew File
British government documents released recently put Andrew’s trade envoy appointment into sharper focus. The head of Britain’s trade body wrote in 2000 that, “The Queen is very keen that the Duke of York should take on a prominent role in the promotion of national interests.”
The problem is what the documents show around that appointment. Trade Minister Chris Bryant told lawmakers that “we have found no evidence that a formal due diligence or vetting process was undertaken” before Andrew received the role. That history now sits inside the police investigation into whether Andrew misused his public office while maintaining contact with Epstein. The inquiry focuses on his trade envoy role from 2001 to 2011, with released DOJ emails suggesting he shared sensitive information with Epstein.
Surrey Police Opened a Child Sexual Abuse Investigation
The United Kingdom track expanded in a second direction when Surrey Police launched a criminal investigation into two allegations of child sexual abuse connected to information in the Epstein files. One allegation relates to locations in Surrey and Berkshire from the mid-1990s to 2000, while another relates to west Surrey in the mid- to late 1980s.
The force said it has made no arrests but would work to verify information or establish corroborating evidence. Two women have come forward alleging they were the victims of attacks described in the Epstein files. The Surrey investigation is the first British police investigation into alleged sexual harm against females relating to Epstein.
France Says New Suspected Victims Have Come Forward
French prosecutors are now listening to women who were not previously known to investigators. Paris Public Prosecutor Laure Beccuau said about 20 suspected victims have come forward since she urged potential victims to speak in February, including around 10 who were new to authorities. “New victims come forward, ones we didn’t know at all,” she told RTL.
The French investigation is focused on possible offenses committed in France or involving French perpetrators who facilitated Epstein’s crimes. Beccuau said investigators had “once again pulled out Mr. Epstein’s computers, his telephone records, his address books” and were preparing requests for international assistance. Some of the suspected victims are abroad, and investigators are arranging meetings around their ability to come to Paris.
Zorro Ranch Has a Report Date
New Mexico’s Truth Commission is scheduled to release its initial report on its Zorro Ranch investigation on July 31. That is important because the ranch, unlike Epstein’s Manhattan mansion, Palm Beach home, and island, sat for years without the same level of investigative attention.
State Rep. Andrea Romero (D), who heads the commission, said it will examine systemic issues that may have drawn Epstein to New Mexico and whether anyone helped sweep things aside. “We know that there are survivors that were on the record reporting abuse,” Romero said.
Why did their case never make it to the state nor federal government to hold that to account in some way, shape or form.
New Mexico’s Department of Justice also maintains an active Zorro Ranch tip portal seeking credible information, and the department said earlier this year that it had reopened the criminal investigation after reviewing newly released federal material.
Bard’s Board Vote Changed the Botstein Story
Leon Botstein’s exit from Bard College no longer reads as a simple retirement story. Bard’s board of trustees voted to end Botstein’s 51-year tenure after board members were presented with the results of an independent review of his relationship with Epstein. Botstein had publicly framed his departure as long planned.
The review found that Botstein had done nothing illegal but that he was “not fully accurate” in describing his relationship with Epstein and did not fully “see” the risk Epstein posed to Bard’s reputation or to students. The fallout is now institutional as Bard confirmed that its longtime board chair, James Chambers, and two others resigned, while an alum has asked the New York attorney general’s charities office to investigate the board.
The Cellmate Story Became Stranger Than the Note
The purported Epstein note was already public. Recently, the story around the man who produced it became harder to ignore. The Guardian revisited the story of Nicholas Tartaglione, Epstein’s former cellmate, a retired police officer later convicted in a quadruple murder case. Epstein initially said Tartaglione attacked him after Epstein was found with neck injuries in July 2019, then retracted that claim. Prison officials later concluded Epstein had tried to kill himself.
Tartaglione reported finding a note from Epstein hidden in a graphic novel after Epstein had been removed from their cell. The note was released earlier this month after litigation, and it included the line, “It is a treat to be able to choose one’s time to say goodbye.” At the time of the release, the Justice Department said it was seeing the note for the first time. The new issue is not only what the note says. It is how something tied to Epstein’s first jail incident sat outside the DOJ’s own file release.
The Reading Room Turned the Files Into a Spectacle
A New York installation is displaying nearly 3.5 million printed pages of Epstein material in more than 3,000 volumes under the title “Donald J. Trump and Jeffrey Epstein Memorial Reading Room.” The project bills itself as “an exercise in radical transparency,” but visitors are not freely browsing the documents because of concerns from survivors that the government failed to properly redact identifying information.
The point of the exhibit is to force the public to confront the scale of the file universe. The problem is also obvious. A mountain of printed pages can dramatize opacity while doing very little to solve it. That tension is why the installation became a story in its own right.
What We’re Watching
The next pressure points are Kellen’s transcript, the three new names she gave investigators, the UK police requests for unredacted American records, and the first Zorro Ranch truth commission report due July 31. The pattern is straightforward enough as the files are still central, but witnesses, police, prosecutors, and independent researchers are now pushing the story into places the official releases did not reach.
Forty-five years ago, a socialist, who previously couldn’t get elected dog catcher in Vermont, walked into his state’s largest city hall and claimed the office of mayor by a landslide margin of ten votes.
Chiasson’s Bernie for Burlington: The Rise of the People’s Politician (Knopf) focuses on the eight years after Sanders ran, as an independent, against incumbent Burlington mayor Gordon Paquette. Despite being a college town and new address for a few 60s-influenced “flatlanders,” the city’s politics were very old school in 1981. Just a few months before Sanders won his mayoral squeaker, GOP presidential candidate Ronald Reagan carried Vermont with 44% of the vote, in a three-way race.
For a long time, there weren’t many other lefties following in the footsteps of now U.S. Senator Bernard Sanders, the longest serving independent and socialist in Congress. But Sanders’ 2016 and 2020 presidential campaigns helped change the landscape of the U.S. left.
Tens of thousands of Bernie supporters swelled the ranks of the Democratic Socialists of America (DSA), a group that previously claimed few elected officials in its ranks. Local DSA chapters have since developed the capacity to recruit and run credible candidates for municipal office in cities and towns across the country, inspired by Sander’s personal example.
Nationwide, about half the 250 elected officials affiliated with DSA are members of city councils or commissions. Seven are mayors, including Emma Mulvaney-Stanek, the former teachers’ union organizer who today occupies Sanders’ old office on Church Street in Burlington (population: 44,000). Another recent mayoral campaign winner is Zohran Mamdani, an out-of-state mentee of Bernie who now occupies Gracie Mansion in New York City. (population: eight million).
Newly elected DSA members like these have gained historical perspective on the challenges facing them in public office by consulting Claiming the City: A Global History of Workers’ Fight for Municipal Socialism (Verso). Shelton Stromquist’s book describes the experience of more than 1,200 municipal officials elected as candidates of the Socialist Party during its early 20th century heyday. It includes many still relevant case studies of struggles to improve city services, raise labor standards, make housing affordable, and place local utilities under public ownership—in the face of business-backed opposition from Democrats and Republicans alike.
A Newer Blueprint
Thanks to Burlington native Dan Chiasson, a poet and literary critic who teaches at Wellesley College, DSA “electeds” now have a shorter and more recent blue-print for “municipal socialism” to study. It includes much practical advice about to how avoid being undermined, discredited, and defeated by that same “duopoly” a century later.
Back then, Burlington was a “dowdy, backward” blue dot in a rural state long dominated by Republicans. Municipal affairs were much influenced by French-Canadian, Irish-American, and Italian-American clans, with close ties to the local business community. As Chiasson recalls Mayor Paquette, “Gordy was a jolly Chamber of Commerce type,” who often sat in a pew behind his own equally observant Catholic family at Sunday Mass. A ten-year incumbent, Paquette tightly controlled the city’s elected Board of Alderman and its appointed commissions, by stacking the latter with friends and relatives.
Sanders resume included being Jewish from Brooklyn, then a civil rights activist at the University of Chicago, and then a back-to-land carpenter and video maker in Vermont. He was also a four-time loser as a Liberty Union Party (LUP) candidate for statewide office. (In the interests of full disclosure, I was a volunteer helper of Bernie’s 1976 campaign for governor, which drew 6.1 percent of the vote.)
Like California’s Peace and Freedom Party, then and now, Liberty Union was a product of Sixties’ radicalism. In his own patriotic Burlington family, Chiasson grew up “being told that Liberty Union was the party of the communes, the draft dodgers, and the strung-out runaways.” This was not true of several brave working-class Vermonters who ran for office under its banner initially. But the performative politics of others, plus their “life-style left” orientation, was not a big draw for blue collar voters, even in a state where the United Electrical Workers (UE), a left- wing critic of the AFL-CIO, was then Vermont’s largest industrial union. Sanders believed that UE members and other workers could be won over by his own more effective class-based appeals.
Going Local
As the Reagan era dawned nationally, Bernie decided to go local. He re-invented himself as a champion of low-income tenants, of whom he was one. At the time, two-thirds of Burlington residents rented their housing, which meant that its “mainly Catholic, culturally conservative working poor” often lived “in badly maintained properties” whose owners “were unscrupulous, if not exploitative.”
When renters sough help from city government, its building inspectors sided with landlords, actually “abetting the eviction process” rather than fixing code violations. To further private re-development plans, Paquette also allowed neighborhoods to deteriorate, because “blighted homes and buildings were much cheaper for the city to acquire and raze.”
Sanders started door knocking, heard such complaints, and fine-tuned his pitch that city hall could actually serve the people. At Chiasson’s house, his grandfather, a brooding World War 11 vet named Milford Delorme, told his wife not to open the door if Sanders was outside. But Bernie’s longshot mayoral bid did gain street cred when influential working class-voices like former mill worker Sadie White, a neighbor of Chiasson’s in Burlington’s Old North End, backed his campaign.
Sanders’ surprise victory gave the local political establishment a huge shock. The local Democratic Party machine, backed by the business community, tried to render the new mayor “completely ineffective so voters would turn him out after his two-year tenure.”
Over four terms, Sanders would eventually increase his city council allies from one to a near majority, helping to lay the groundwork not just for a local Progressive third party, but a statewide one. However, any initial implementation of his pro-worker, pro-tenant agenda required the creation of a volunteer-driven “shadow government,” which got things done “outside the official administrative circuitry of city hall.”
The best parts of Bernie for Burlington—the ones worth closest study by embattled municipal reformers today—describe the creative solutions that Sanders, his staff, and supporters developed to address the need for affordable housing, property tax reform, better parks and cultural programs, youth jobs and public service provision, like snow plowing. To meet that seasonal challenge in a new way, Bernie made sure that streets and sidewalks in poor and working-class neighborhoods, with more pedestrians, got cleared first, rather than wealthier sections of town, while a volunteer network also pitched in to help the elderly shovel out.
As Chiasson noted in a recent interview, Burlington also “set up the first community land trust of its kind in the country.” Under Bernie, the city bought up distressed properties, put residents in job training programs to work fixing them up, and then, through their sweat equity, enabled them to own the “four walls,” while the city retained ownership of the land. Homes rebuilt this way could only be sold back to the land trust with the any individual profit capped at 25 percent. According to the author, as city owned properties–selling below market value–proliferated, greater affordability was achieved by “establishing a new market value.”
By the time Sanders was ready to move up and beyond Burlington city hall, he was, like Chiasson, waxing poetic. In one of his final speeches as mayor, Bernie cited the many accomplishments of his administration as proof that, in a better civic environment, “men, women, and children can come together in relationships that are not based on greed, exploitation, and domination — but on love, cooperation, and mutual respect.” That’s a vision for “re-claiming the city” still worth aspiring too, four decades later in two, three, many Burlingtons.
(Steve Early lives in Richmond but spent his politically formative years in Vermont. He is a longtime member of the Communications Workers of America, was a co-founder of Labor for Bernie, and has written six books, including Refinery Town: Big Oil, Big Money, and the Remaking of an American City. He can be reached at Lsupport@aol.com).
Steve Early is a longtime labor journalist and author of Save Our Unions: Dispatches from a Movement in Distress (Monthly Review Press, 2013), The Civil Wars in U.S. Labor (Haymarket Books, 2011) and Embedded With Organized Labor (MRP, 2009)
I met Scott Pelley for the first time last year. He and his producer wanted to do a “60 Minutes” episode about Donald Trump’s attacks on lawyers and law firms. The problem was that few lawyers were willing to speak with them. They wanted to know if I would talk publicly. After being convinced that they would expose the capitulation and collaboration of Big Law with Trump, I agreed. Pelley pulled no punches. He began the segment with a stark disclaimer: “It was nearly impossible to get anyone on camera for this story because of the fear now running through our system of justice… Many firms and attorneys have been targeted. Among them is Marc Elias, a longtime opponent of Trump, who is the only lawyer the president has named who was willing to appear on ‘60 Minutes.’” Over the next 20 minutes, Pelley methodically dissected Trump’s unprecedented attack on the legal profession and the cowardice of the nation’s largest law firms that failed to stand up to him. He laid bare the toll this was taking on individuals and the rule of law.His presentation was professional and compelling. It was, in short, journalism at its finest. After the broadcast aired, I received a great deal of feedback. Most of it was positive; some was predictably hateful. But among many of my peers who practice at large firms, there was mostly an awkward silence. They knew that Pelley’s portrayal of their firms and the profession was accurate. Since then, Trump has continued to wage war on the institutions of democracy. He attacks the arts, science, the courts, the states, and — of course — the media. Like lawyers, media figures are uniquely positioned to fight back against these undemocratic efforts. After all, by definition, the media can command attention and deliver a compelling argument. Yet, like Big Law firms, the largest media entities have chosen cowardice over defiance. Since Donald Trump’s election in 2024, ABC and CBS have settled bogus lawsuits by paying millions to Trump. NBC’s parent company contributed to his ballroom. The Washington Post has shifted to a conservative editorial stance at the behest of its owner, Jeff Bezos. Sadly, these are just the most obvious manifestations of media capitulation. Every day brings subtle new signs of media deference — in the framing of a headline, the placement of a story, the false equivalency drawn between Trump and his opponents. Like law firm partners, reporters at these media institutions are conflicted. On the one hand, they see what is happening and want it to stop. On the other, speaking out risks losing their jobs and inviting professional criticism. So even as the legacy media grows more compliant with Trump, news consumers are met with gaslighting and silence.
Nowhere has this been more evident than at CBS News. For the entirety of Trump’s second term, its parent company, Paramount, has been involved in a messy sale. Its eventual buyer — David Ellison — is close to Trump and, more importantly, needed the Trump administration’s approval to complete the deal. Trump doesn’t care who owns Paramount’s movie division, but he cares deeply about how he is covered in the media. Conveniently for him, Ellison is focused on the entertainment assets and has little interest in the news division. CBS News has consequently been placed under the control of Bari Weiss, a conservative commentator and founder of The Free Press, and is being remade to be more conservative and friendly to the Trump administration. For the most part, journalists at CBS News have stayed silent. So too have those at CNN, which will also be owned by Ellison once the deal closes. CNN had already begun pivoting away from its critical coverage of Trump before the sale. Once Ellison owns the network, it will almost certainly follow CBS News in becoming a more avowedly pro-Trump outlet. Pelley’s story is, in many ways, the mirror image of what I experienced. Just as a handful of lawyers refused to be silenced when Trump came after the legal profession, a few journalists are now willing to stand tall in the face of this assault on a free press. Pelley is one of them. At a meeting yesterday with the new head of 60 Minutes, Pelley let loose. He accused Weiss of “murdering ’60 Minutes.'” More importantly, he made clear it was intentional: “She was brought in to kill it — and she’s doing exactly that.” Pelley is right. The Paramount deal was straightforward: Ellison gets Paramount and the entertainment assets he wants, and Trump gets a neutered CBS News. Killing “60 Minutes” is simply one part of that bargain. I suspect that Pelley woke up today to the same reaction I did when I appeared on his show — plenty of praise, some criticism, and mostly frightened silence from his peers. Democracy will not survive the next two and a half years without more people willing to do what Scott Pelley just did. But the prospects of that happening within our large institutions are dim. I left Big Law in 2021 and started a law firm that is now litigating 87 voting and election cases in 43 states. As lawyers, we are not afraid. We will never back down. That same commitment is what drives Democracy Docket. I created it in 2020 to be an unapologetically pro-democracy news outlet — one with no corporate owners and no private equity or venture capital investors. It relies on subscribers like you to help it thrive. Unlike the legacy outlets retreating under pressure, Democracy Docket cannot be bullied by this administration or any corporate overlord. But to truly fill the void their retreat has created, it needs to grow in size and scale — and fast. If you can afford to become a premium member, please consider doing so today. It will help Democracy Docket expand its coverage and reach as we head toward the 2026 midterm elections. If you can’t, consider sharing this email with a friend or family member who might be interested in joining our more than 400,000 free subscribers. Your support, in any form, helps the team at Democracy Docket speak out, stand tall and fight back.
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The hype surrounding generative AI has generated astronomical amounts of value, with tech companies raising tens of billions of dollars and many — including OpenAI and Anthropic — preparing to go public this year at sky-high valuations, in moves that will produce incredible wealth for their stockholders.
Whether the average Joe will ever directly benefit from all of this is looking dubious at best. That’s despite many of these tools relying on AI models that were trained on the creative output of millions of people, copyright be damned, the vast majority of whom have yet to see a single cent. Quite the contrary — many workers are facing a disastrous job market as a result of corporations stretching themselves thin through massive investments in AI.
To independent senator Bernie Sanders (D-VT), that kind of injustice needs to end. In an essay published by the New York Times, Sanders argued for the creation of an “AI Sovereign Wealth Fund” that would be created through a “one-time 50 percent tax” on the stock of AI companies, including OpenAI, Anthropic, and xAI, to “give the public a direct ownership stake.”
In other words, Sanders is proposing to transfer half of the AI companies’ stock into a public fund — a one-time transfer as opposed to a tax on profits — which the government will manage. Generated revenues could be distributed as “direct payments to the American people.”
While many important details have yet to be ironed out, as Sanders admits, it would represent a massive shift and equity transfer — if his act were to pass, that is.
“The question, then, is not whether AI will change the world,” he wrote. “It will. The question is: Who will own and control that future? Who will benefit from it, and who will be hurt by it?”
Sanders argues such a fund would “give the public a direct role in determining the future of this technology,” while also guaranteeing that the “trillions of dollars potentially generated by AI are used to improve the lives of all of us — not simply to make the richest people in the world even richer.”
While chances of the senator’s idea surviving the Congressional approval process are likely slim — the AI industry holds immense influence over Congress — it’s a creative approach to an increasingly sticky problem. Even tech leaders, who have watched as the backlash to AI continues to grow, have turned their attention to possible solutions to address even greater wealth disparity caused by the emergence of AI.
Jeff Bezos recently argued that the bottom 50 percent of earners shouldn’t pay any taxes, while OpenAI CEO Sam Altman came up with a new concept called “universal basic compute,” which would provide free access to those who can’t afford costly AI tools. Meanwhile, SpaceX founder Elon Musk has called for a new take on universal basic income, uninspiringly dubbed “universal high income.”
Sanders’ sovereign wealth fund takes the idea a step further, giving Americans who don’t happen to be tech billionaires an opportunity to get in on the ground floor. The concept has already been “put into practice right here at home,” Sanders wrote, pointing to an Alaskan sovereign wealth fund that’s allowed residents to receive annual dividends through oil revenues.
“To start, the billions, if not trillions, of dollars generated by this fund would provide direct payments to the American people,” he wrote. “And as the fund generates more and more wealth, the proceeds would be used to ensure that every man, woman and child in our country has a decent and dignified standard of living, including health care, education and housing.”
I’m a senior editor at Futurism, where I edit and write about NASA and the private space sector, as well as topics ranging from SETI and artificial intelligence to tech and medical policy.
Tell Congress to stop Trump’s war with Iran NOW. Republican leadership canceled a vote on a resolution to end the Iran war just before Congressional recess because it appeared the legislation was about to pass the House. This week, amidst new flare ups in the war that could lead to more death and chaos, the vote could come up. Email your representative and demand they vote to end this illegal war now!
Posted on June 1, 2026 by Ellen Brown (EllenBrown.com)
Part 1 of this “Abundance Paradigm” series discussed predictions that artificial intelligence and robotics will in the relatively near future produce an economy of extraordinary abundance – one in which most labor is automated. The contention of Elon Musk is that this development will require some form of government-issued “Universal High Income” (UHI) to provide the consumer demand necessary to keep the economy functioning in a world where machines do most of the work.
Based on those projections, I argued that if a UHI were to become necessary, it could not realistically be financed through taxes or debt alone, but would require some form of debt-free sovereign money issuance — a modern version of Lincoln’s Greenbacks. The usual objection to government-issued money is that it would drive up prices and devalue the currency due to “too much money chasing too few goods.” But in this case, we would have too many goods and not enough money to provide the consumer demand to move them off the shelves. A source of abundant new money would actually be needed to keep trade flowing.
Objections came thick and fast. Some critics saw the AI revolution not as liberation but as a technocratic nightmare: AI surveillance, programmable digital money and “smart cities,” centralized control systems, and a future in which most people will own nothing while a tiny elite owns the machines, the data, and even the government. Others challenged the underlying premises: Would AI really generate such extraordinary abundance? Would productivity rise enough to justify something like a UHI? Or is this simply another round of Silicon Valley hype detached from economic reality?
Those are legitimate questions that deserve serious consideration, serious enough to require more than one sequel to address them. But whether or not we approve of Elon Musk, Sam Altman, or the AI industry itself, the AI revolution is already underway, driven by forces far larger than any individual actor. Businesses want AI because it lowers costs and increases productivity. Governments want it because they view it as strategically essential. Consumers increasingly rely on it because it saves time and improves convenience. The genie is out of the bottle.
Commentators say the AI boom is unlikely to disappear even if parts of it are overhyped. Investment firms, technology analysts, and economists increasingly describe AI not as a passing fad but as a foundational technological transition comparable to the invention of electricity or to the internet itself. Even skeptical analysts who question short-term productivity claims generally acknowledge that businesses are rapidly reorganizing around AI-assisted production.
The question now is not whether AI should exist but how we can adapt to it without falling into economic collapse or digital feudalism.
AI is Challenging the Fundamentals of the Capitalist Model.
For centuries, industrial economies have depended on a productive cycle based on work for pay. People work for wages, wages create consumer demand, and demand sustains production. But if machines increasingly perform not only factory labor but office and laboratory work — drafting contracts, diagnosing disease, designing products, writing software, driving vehicles, conducting research — then labor income will steadily decline even as productivity rises.
That creates a paradox for the capitalist model: Who buys the products if fewer and fewer people earn wages from producing them?
Historically, technological revolutions created new forms of employment even as they destroyed old ones. The automobile displaced blacksmiths but created mechanics, highway engineers, gas stations, motels, and suburbs. Computers eliminated typists but generated software industries and millions of office jobs. But AI is not confined to one sector. It is predicted to take jobs across the board.
We are not at that stage yet. But China, the world’s largest manufacturing power, is getting close, and Chinese commentators are beginning to grapple with the issue.
In the past, Chinese officials have rejected proposals to distribute cash to households, even when many families were clearly in need of support.
But while the term universal basic income has yet to appear in any official Chinese policy documents, it may become less foreign in the coming years because of the increasing replacement of entry-level jobs by machines.
Advances in technologies such as artificial intelligence (AI) and automation are expected to render many traditional labour roles obsolete ….
While new technologies will create new job opportunities, these roles are often unsuitable for workers displaced from traditional sectors. The pace at which old jobs are eliminated also outstrips the creation of new ones, which could lead to significant structural unemployment.
A March 2026 article in ThinkChina raised a related issue. In “When AI Replaces Workers, Who Pays the Taxes?”, Chinese entrepreneur Simon Lin asks if AI systems and robots perform an increasing share of productive work, where will governments obtain tax revenue? Lin’s proposal is to tax the companies that profit from automation. That would help finance the government, but it doesn’t solve the distribution problem. Consumers still need purchasing power. Henry Ford understood this a century ago, when he said he needed to pay his workers enough to buy the cars they produced.
… [T]he knowledge economy offers great potential for bettering the lives of people. But capitalism may not be the best route to take. Power in the hands of a few, income gaps, job losses and wage cuts in the digital age bear this out. Can China offer a third way as it seeks to marry socialism with a market economy? The West is already considering some proposals with a socialist bent such as the Universal Basic Income (UBI). Surely, proponents of socialism can think of even more revolutionary ideas?
The article continues:
… China has a substantial low-income demographic. 600 million people live on about 1,000 RMB per month, which is insufficient even for housing rent alone. What we have here is inadequate demand from those with spending power, coupled with a tremendous surplus of production capacity.…
The author observes that knowledge, once created, can be reused repeatedly at close-to-zero marginal cost, and that the AI-driven “knowledge economy” grows exponentially. That makes it possible for social productivity to grow exponentially as well, eliminating want and greatly enriching material and spiritual life. But capitalism poses some serious constraints on that promising future:
… [A]s the knowledge economy becomes increasingly “smarter” (AI-driven), the share of wage income in the total distribution of income will continue to decline, while investment returns will be a constantly growing piece of the pie. This means the lion’s share of society’s wealth will be swallowed by capital. In the long run, only jobs with wages lower than the cost of automation have any chance of being kept.… This means that wage levels are bound to be kept low, even to the point of being inadequate for feeding oneself and one’s family.
The article concludes: “China should kick-start preliminary research on universal basic income (UBI), as soon as possible. … What is UBI, after all, if not an attempt to rise above capitalism?”
Resource Constraints: Energy
China may need to consider some sort of UBI, but in the United States the biggest practical hurdles to AI abundance may not be political but physical. Where will the U.S. find sufficient resources to produce the goods?
Critics point to the enormous energy consumption of AI data centers, the water demands of cooling systems, the mining requirements for batteries and semiconductors, and the environmental costs of rapid electrification. Some large data centers consume millions of gallons of water daily for cooling. Communities near rapidly expanding facilities have already reported stress on local water systems, and public pushback is growing.
Elon Musk has argued that the water problem is basically an energy problem, noting that once you have enough energy, desalination becomes cheap and simple. His proposed energy solution is solar. At a July 2017 National Association of Governors meeting, he said, “If you wanted to power the entire U.S. with solar panels, it would take a fairly small corner of Nevada or Texas or Utah; you only need about 100 miles by 100 miles of solar panels to power the entire United States. The batteries you need to store the energy, to make sure you have 24/7 power, is 1 mile by 1 mile. One square-mile. That’s it.” Not that all this equipment would need to be in one place, but that shows the projected scale.
The chief constraints to rapid and broad-scale solar development are political and regulatory. The solution being pursued now is solar collection in space, where the sun never sets, massive amounts of energy are available, cooling the equipment is not a problem, and there are no regulatory constraints.
Solar is not, however, the only possible energy solution. Advanced fission and fusion technologies are also in rapid development, largely due to AI-assisted engineering.
Small modular nuclear reactors (SMRs), once largely theoretical, are now moving into commercial development. SMRs are factory-built, standardized systems small enough in some cases to be transported by truck and assembled on site. Supporters argue that modular manufacturing could dramatically reduce both cost and construction time compared to conventional nuclear facilities.
Fusion energy, long mocked as perpetually “thirty years away,” is also advancing. Experimental reactors are already generating plasma temperatures hotter than the core of the sun, while major advances in magnetics are steadily improving stability. The main challenge is that superheated plasma behaves chaotically inside reactors, but AI systems are being used to predict these disruptions and make adjustments before they occur.
That doesn’t mean limitless energy is just around the corner. But the assumption that civilization is approaching an unavoidable energy ceiling may be outdated. In fact AI itself is becoming a key tool in creating the next generation of energy systems needed to support AI-driven productivity.
Physical Resources for Batteries, Electrical Grids and Agriculture
Thus while AI uses more power, the efficiency it creates in the rest of the physical economy may actually lead to a net reduction in total global resource consumption.
Solving the Water Crisis
Singapore’s NEWater program is the gold standard for wastewater recycling, turning sewage into ultra-clean, drinkable water. It has now successfully “closed the water loop,” making the island nation resilient against external water shocks.
AI data centers are also now pivoting away from evaporative cooling to water recycling. Modern “closed-loop chilling systems” allow data centers to operate with near-zero direct water consumption once the system is filled. New major projects are marketing themselves as “water-neutral” by using closed-loop cooling technology that recirculates water rather than evaporating it in cooling towers.
Some analysts argue that the location of data centers is wrong. Unused areas are available that have abundant water supplies, existing industrial zoning, and underutilized energy infrastructure. But for communities already under stress from data centers that probably aren’t going anywhere, my own proposal would be to drill for primary (juvenile) water for residential needs. Continuously generated deep in the earth and rising through faults, primary water offers a clean, renewable, locally tappable water source independent of the surface cycle, easily accessible with robotic drilling and abundant energy. The model has been proven primarily in Africa. See my earlier article here.
Wind Power
Meanwhile, China has successfully launched the world’s first commercial underwater data center powered directly by offshore wind. The Shanghai project was completed for less than half the cost of an equivalent 24-megawatt land-based facility, and by using seawater for cooling, it is about 30% more efficient and cuts electricity consumption by over 22%. [Add second source.]
However, underwater data centers were not pioneered by the Chinese. Microsoft’s Project Natick, a2018–2020 trial off the coast of Scotland, was a technically successful test that demonstrated higher reliability and lower failure rates than land servers. But Microsoft announced it was abandoning the project in mid-2024.
In the U.S., a private company like Microsoft must negotiate with local utilities and typically must pay for its own grid upgrades, which can add years and millions of dollars to a project. In China, state-owned power companies provide special energy pricing and dedicated high-voltage lines for data center clusters. There are also regulatory hurdles in the U.S. and Europe, where complying with environmental regulations is a slow and costly process.
In China, by contrast, the government designates specific areas where environmental reviews and construction permits are fast-tracked specifically for “Green AI” projects. As a result, construction is often 30% to 50% faster than for their Western counterparts. The Chinese underwater data centers are part of a massive state-led industrial policy called the “East-to-West Computing Resource Transfer,” a highly coordinated top-down strategy that treats data centers as a critical national utility integrated directly into the national energy grid. Besides providing direct subsidies and grants, the Chinese government has built offshore wind farms specifically designed to plug into data center units. Placing the AI servers directly at the base of the wind turbines eliminates the energy loss and cost of transmitting power back to the shore.
This is another real-world example demonstrating the need for public investment in infrastructure, ideally through a national infrastructure bank, to fund projects that private markets find too risky or too expensive to build alone.
The Road to Creative Freedom or to Digital Feudalism?
The potential for AI/robotic productivity is promising, but it will not automatically benefit the public. Productivity has already risen dramatically over the past century, while wealth has concentrated at the top.
The future emerging around AI contains two radically different possibilities. One is a highly centralized technocratic system in which wealth and power become highly concentrated, while citizens are managed through digital currencies, surveillance, and algorithmic governance. The other is a civilization in which automation gradually liberates human beings from monotonous labor, shortens work time, expands access to education and creativity, and allows technological abundance to serve broad human flourishing rather than narrow financial interests.
Both futures are technologically possible. Which one emerges will be determined not by the machines themselves but by the political and monetary systems governing them.
Part 3 will examine what is probably the most emotionally charged issue involved in the AI revolution: digital money, central bank digital currencies, surveillance fears, and whether an AI-driven economy inevitably leads to a programmable financial control grid.
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