How AI will reshape society

What will change, and what won't

This piece was first published in City Journal.

But the biggest thing that has happened in the world in my life, in our lives, is this: By the grace of God, America won the Cold War.

A world once divided into two armed camps now recognizes one sole and pre-eminent power, the United States of America.

And they regard this with no dread. For the world trusts us with power, and the world is right. They trust us to be fair, and restrained. They trust us to be on the side of decency. They trust us to do what’s right.

— George H W Bush, 1992 State of the Union Address

Ten years after George H. W. Bush’s end-of–Cold War speech, his son, George W. Bush, led the United States into wars in Afghanistan and then Iraq. When those conflicts wound down after twenty years, a decrepit President Joe Biden oversaw a chaotic withdrawal from Afghanistan, handing the Taliban a total victory and leaving the United States exhausted and its confidence shaken.

Over the same period, a decade-long cultural revolution in America spilled across the world. A global pandemic exposed systemic fragilities and upended social norms. A second Donald Trump presidency emerged—snatched from the wings of fate, nearly ended by an assassin’s bullet, and secured against the collective will of institutional America. Meantime, China quietly built the world’s largest cities and moved from a backward, low-value economy to the technological frontier, positioning itself as a genuine rival to American hegemony.

The first quarter of the twenty-first century has already been tumultuous. And now a new technology has emerged—one that has put a genie into every pocket. A few years ago, that genie could answer questions, win at Go, and sketch a passable picture. Today, it is the smartest person you know on almost any subject: offering near-instant feedback on your work, personal advice, app-building, sales and customer management, Excel modeling. Tomorrow, it will do far more.

Artificial intelligence has triggered what may be the largest capital-expenditure boom in history, with hyper-scalers spending hundreds of billions in 2025 and committing trillions more, even building proprietary energy sources as governments struggle to keep pace. It has propelled technology giants to multitrillion-dollar valuations. It is a new dawn. To borrow from George H. W., it may be “the biggest thing that has happened in the world in my life, in our lives.” How will AI reshape society?

Why should AI reshape society at all? Because major technological leaps have always transformed how people organize, live, and work. The stirrup enabled brutal imperial expansion and conquest. The cannon, shipbuilding, and deep-sea navigation opened the world to global empires. The printing press helped trigger the Reformation and the Thirty Years’ War. Modern communications and transport loosened local bonds, scaling familial loyalty up to the nation-state. Railways brought unprecedented mobility—and a wartime rigidity that helped doom a generation in the First World War. The atomic bomb arguably sustained great-power peace for nearly 80 years.

What, then, will AI bring? Prophecy may be for charlatans, but we can hazard a guess.

1. Unprecedented Scale

We already live in a world of multi-trillion-dollar companies. We are approaching the era of the trillion-dollar man. Elon Musk may be the highest-leverage individual in history, presiding over a multi-industry hydra that is reshaping space, mobility, communications, media, biotech, and AI. Yet Musk himself belongs to a pre-AI era. What individuals can now create with the genie from their pocket will push great men to heights previously unimaginable. Call this elite hyper-agency: the collapse of distance between will and action at a global scale.

In the eighteenth and nineteenth centuries, European empires reached their zenith. Armies, privateers, and corporations like the East India Company ruled millions with thousands. In the twentieth century, vast trading houses, oil majors, and industrial conglomerates spanned the globe. But the central story of the twentieth century was national power: its eruption into world wars, the rise of nuclear-armed superstates in the Cold War, and, ultimately, an American colossus astride the world.

The twenty-first century has seen the rise of technology giants. Soon, those giants—and others—will dwarf their present scale, commanded by a select few.

Ronald Coase argued that firms exist because markets are costly: when the friction of contracting, coordination, and supervision exceeds the cost of hierarchy, activity moves inside the firm. For two centuries, that logic governed scale. AI collapses transaction costs, blurring, and in some cases erasing, the boundary between market and organization.

The result is a bifurcation of power. Some entities will scale far beyond historical limits, coordinated by systems rather than managers. Others will fragment into individuals and small groups wielding institutional-grade capabilities without institutional morass. The middle will wither.

Will ten-trillion-dollar firms and trillion-dollar men dissolve nation-states? Probably not. States, too, will grow more powerful, armed with new tools of surveillance, automation, and robotics. We have already seen how quickly Silicon Valley and Seattle adapt to shifting political winds, bending to new masters. As governments harness these sectors, their power will also grow.

2. The Tower of Babel: cultural homogenization + deep personalization

The twenty-first century has brought cultures together into a Great Global Homogenization. Not only place but time has flattened as well. Each decade of the twentieth century had a distinct vibe; today, far less so. Everything blends into a single cultural mush.

Why? The smartphone is now nearly universal. Through its screen, we see one another constantly, drawn into a shared global online realm. That realm has been largely American in character, shaped by U.S. technology giants. Outside of states such as China, Russia, and South Korea, which maintain their own digital ecosystems, this represents the greatest cultural flood in history. We all inhabit the same platforms: Instagram, TikTok, Facebook, Google.

This process will only accelerate. Creators will work in any language and reach audiences larger than ever, as AI seamlessly translates content into each reader’s or viewer’s preferred tongue. In this sense, we have rebuilt the Tower of Babel: a single global community spiraling skyward in hubris.

Yet this apparent restoration masks a deeper fracture. We may share a language, but we no longer share a reality. AI can bridge tongues, even as it personalizes truth, placing each individual in a private cubicle of the Tower, ensconced in their own algorithmic filters. In this fragmented landscape, the ‘shared’ information stream dissolves into thousands of bespoke hallucinations. Institutional authority erodes, replaced by a narrow circle of personal trust: we no longer believe what is reported, only what is vouched for by the few human voices we still recognize as real.

3. The rise and rise of positional goods

Alongside elite hyper-agency, we will see mass passivity. We will be wealthier. We will have more leisure. But where will it go? We are unlikely to feel much better off.

In parts of the West, the work week has already effectively been reduced to four days. Thursday nights are for eating out; Fridays are nominally for “working from home.” Gambling on stocks and sports will continue to increase, AI porn and video games will consume more time. Man will grow even more neutered: fertility rates will stagnate, crime will fall, and life for many will slip further into passive consumption.

Beyond this surplus of ‘leisure,’ where will the fruits of increased wealth go? As with much of the last century’s productivity gains, they will flow into positional goods. A house in Sydney’s Eastern Suburbs or Manhattan is priced less by its cost of construction than by the scarcity of the asset. There are only so many harbor homes and only so many views of Central Park. These markets are governed by zero-sum status competition. (Think also elite private school fees.)

Expect, then, the continued inflation of status-signaling goods: luxury items above all, and none more so than prime property. Today’s extreme prices will look like a bargain tomorrow. In less desirable regions, by contrast, prices will fall as population decline takes its toll.

4. Broad, low-level conflict

With the end of Pax Americana, local conflicts will become more common. Many wiser heads on China than me, but I doubt there will be a U.S. war with China. It is not obvious that even the Taiwanese want to fight over Taiwan, given their modest defense spending—2.4 percent in 2025, albeit with plans to increase—and increasingly fractious internal politics. China depends on U.S. consumer markets to keep its factories running and employment high; the United States, in turn, depends on China for critical component inputs across key industries.

And whilst global economic integration was hailed as rendering war impossible prior to 1914, today is not 1914. Nor is it 1939. Then, societies had an abundance of young men they could send to war, animated by ideas of glory and new ideologies. One reason the Soviet army ultimately defeated Germany was its capacity to replenish losses with sheer numbers. These days, young people are scarce, and rulers are old. Regimes across the world want the young to care for expanding elderly populations, not to die in foreign wars. Putin’s miserly conscription during the invasion of Ukraine may reflect this constraint. China cannot afford to lose a generation of only-children. The United States is deeply reluctant to send more boys on overseas misadventures—the Venezuelan operation was a regional affair and required no boots on the ground.

Conflict is likely to remain regional, with governments increasingly focused inward. Virtual realities will grow more dominant, making narrative control ever more critical. The cost of cyber operations and low-level drone attacks will fall dramatically, and we should expect many more of them. But the cost of defense will fall, too.

5. The end of privacy

The flip side of AI agents taking your calls, completing tasks for you, and personalizing purchase decisions with greater precision than ever before is that AIs will know every externally knowable thing about you. By extension, governments and security services will seek this information, as will bad actors. This won’t necessarily be dystopian. This future will manifest itself differently based on each society’s cultural norms and the way they evolve. Some societies will be far more intrusive, with government intervention by default—in China: “People are doing, the sky is watching”—while others will find new data and privacy protection equilibria.

In practice, many knowledge workers will find that their managers can see exactly how many emails they send, calls they take, or hours they spend faffing about on Substack. Not because of sinister intent, but as an incidental by-product of AI-agent ecosystems. And most of us will probably shrug and carry on.

6. The collapse and reconstitution of moral agency

AI intensifies questions of moral agency. In the 1990s, it was chic to bash big business for controlling our minds through advertising—think Naomi Klein’s No Logo or body-image advertising concerns. In the 2010s, a moral panic broke out around social-media algorithms—people were willing to conflate controlling our feeds with controlling our minds. AI will intensify this social concern as it nudges us with ever more granular personalization and acts in the real world on our behalf.

For most of history, agency and accountability were tightly coupled: you chose, you acted, and you bore the consequences. Modern bureaucracies strained that link; Adolf Eichmann’s “banality” was in the distance between his participation in bureaucratic machinery and the final slaughter of millions. AI threatens to sever it altogether. We are entering an age of delegated agency, in which outcomes are overseen by humans who did not meaningfully choose them and often cannot explain them.

The result will be widespread moral de-skilling. Judgment, restraint, and responsibility will atrophy when systems are always on hand to decide and justify on our behalf. When things go wrong, we will blame the models.

A new and deeper class divide will emerge—not rich versus poor, but deciders versus delegators. The elite will reserve human judgment for themselves; the mass public will live inside automated choice architectures optimized for fairness, compliance, and risk minimization. Human discretion will become a luxury good.

As institutional responsibility dissolves, authority will reappear in personal form. People will place their trust in founders, leaders, prophets, and strong executives willing to own their decisions. Our spiritual malaise will deepen. Comfort will rise, friction will fall, and meaning will thin. In a world where choice is outsourced and failure is padded away, people will search—politically, aesthetically, and religiously—for ways to feel responsible again.

7. Rise of prophets

Notwithstanding George W. Bush’s evangelical America and the threat of radical Islam, religious feeling in the West has declined over the past few decades, though it has arguably reappeared in the cultural excesses of the last ten years.

As fertility falls, communities with strong pro-fertility cultures (such as the Amish and Haredi) will make up a growing share of the population. These technology-skeptical groups will form the counterweight in a barbell world opposite our AI-first society. Unplugged communities will proliferate, taking advantage of lower house prices in depopulated regions. And in an age of selective trust and digitally immersed, passive masses, new religions and cults will emerge.

They have been relatively quiet in recent decades. But frontiers tend to produce new faiths. The American frontier gave rise to Mormonism; in New Zealand, a Māori ‘people of Israel’ emerged. The new virtual frontier will likewise launch prophets and charlatans alike, each offering cures for a spreading spiritual malaise. For some, AI itself will become the prophet.

And who knows—perhaps we are living through the age of the Moshiach.

8. Some things won’t change

Some things are eternal.

You will want to cultivate a rich inner life. An AI can read and write anything, but it can only do it for you in the most superficial sense—it cannot know or feel for you. It cannot delight in a new vein of knowledge for you. It cannot be curious about the miracle of creation on your behalf.

You will want to feel intimacy with another person—in the flesh. To flirt and fumble. To love. Virtual realities will not be an adequate substitute for the vicissitudes of life.

You will want to look after your body. Feel the spray of ocean water against your face. The sweat of a hard workout. The aliveness in an active self.

You will want to have children. Especially in a world that will be increasingly hostile to them. An AI will not be able to feel the satisfaction of teaching your children for you. Of dancing with your daughter. Of watching your boy score a goal. This is the great long trade of the twenty-first century. Your children will inherit the earth relatively more than any prior generation.