Cory Doctorow used his June 17 Pluralistic newsletter to argue that the bigger economic danger around AI is not machines taking every job, but institutions moving money and power toward assets whose value depends on belief, hype and resale expectations.
The piece builds on economist John Quiggin’s recent essay, “One Big Grift”, which Doctorow cites for the claim that financial markets are failing at pricing assets and that the institutions meant to keep those markets honest have stopped trying. That is a pretty bleak diagnosis, and Doctorow does not sand off the edges.
Doctorow starts with Elon Musk. He writes that Musk’s nominal net worth rose from $20 billion in 2020 to $1 trillion today, while arguing that Musk’s post-2020 ventures have performed far worse than the earlier businesses associated with Tesla, batteries and Starlink. Quiggin, as summarized by Doctorow, contrasts that earlier period with Starship, robotaxis, Cybertrucks and Twitter, which he presents as a run of weak commercial bets and damaged assets.
The mechanism Doctorow is describing is familiar to anyone who has watched crypto, meme stocks or AI infrastructure fever: an asset can trade up because buyers believe later buyers will pay even more, regardless of whether the thing produces much useful output. Doctorow points to Quiggin’s earlier argument that Bitcoin challenged the efficient-market hypothesis, then extends the same logic to SpaceX and AI.
Crypto is central to the comparison. Doctorow notes Quiggin’s observation that big banks once kept crypto at arm’s length, while now offering crypto services. He adds that the term “cryptocurrency” has faded in practical use because even promoters rarely treat it like ordinary money. In his framing, crypto has become a tradable collectible rather than a payment system.
Doctorow also cites Quiggin’s claim that Goldman Sachs is backing Musk’s SpaceX public-offering story, including Musk’s projection that his collection of assets could rise one hundredfold within 40 months. That claim is reported as Quiggin’s characterization, not an independently established valuation forecast. The sensible reader should keep a hand on the wallet.
AI as management fantasy
Doctorow then turns to Owen McGrann’s essay “The Dead Economy Theory”. McGrann, as Doctorow describes it, uses the phrase for a future in which AI displaces human labor at broad scale. Doctorow likes the label and rejects the application.
His argument is that the nearer-term labor risk is managerial credulity. In Doctorow’s version, an AI vendor sells a boss on the idea that a chatbot can replace workers, the boss fires people, and the software then fails to do the work well. The job loss still happens, but the cause is procurement by fantasy rather than working automation.
Doctorow applies the same criticism to public funding priorities. He argues that useful AI for cancer research would mean tools that help researchers process hard multivariable analysis problems. He contrasts that with his claim that research funding is being cut while money is steered toward data centers and AI firms.
The broader charge is blunt: Doctorow says the “dead economy” is an economy that drains capital from productive work into speculative stories. In his telling, AI is dangerous less as a competent replacement for labor than as a permission structure for bad executives, credulous banks and investors chasing vibes with spreadsheets attached.
This story draws on original reporting from Pluralistic.
