West Lafayette, IN – Marc Andreessen, billionaire venture capitalist and self-proclaimed “techno-optimist”, sees AI as an overwhelmingly positive thing for society. He confidently predicts that AI will soon take over virtually all jobs, barring one: his own. Citing the “intangibility to it,” the “taste aspect,” the “human relationship” aspect and “psychology,” he theorizes that the unique skills of the venture capitalist are “timeless” and may be one of the last fields human beings work in.

But AI is not on the verge of being introduced, it has been introduced into every sector of the economy possible, and the balance sheets are coming up wanting. Last year MIT conducted a study of over 300 firms and found that 95% of them saw no return whatsoever on their investment in AI. British firm PricewaterhouseCoopers reported in its 29th annual CEO survey that over half of respondents had seen no benefit from AI whatsoever, either in the form of reduced costs or higher revenue.

Despite these gloomy reports and increasing fears that the dramatic overvaluation of the tech companies tied into the AI boom is a financial bubble waiting to pop, the tech moguls are still demanding more investment. For the most part, they are getting that investment, whether into sprawling new data centers or the power stations to keep them online. While cultural backlash to AI “slop” is becoming more and more widespread, it is clear that the capitalist class still sees AI as the future.

In trying to understand why, it is important to disaggregate the hype of AI’s most shameless salesmen, like Sam Altman or Elon Musk, from the actual capabilities of the technology. Essentially at its core all of what we see called “AI” is just a series of mathematical equations whose parameters are set by a combination of pre-existing data and manual rules set by its designers. The process of “training” AI can be likened to feeding paper into a shredder that can then recombine the letters and words to form new sentences. The AI is “incentivized” to make “good” sentences, which tends to mean ones that look like a human could have written them. The same goes for photos, videos, or music: all the AI is doing is regurgitating something it was already fed.

Throughout the entirety of the process, then, human labor still plays the essential role. Humans need to make the works to be fed to the AI in the first place, because if AI is trained on AI generated data it begins to “rot” and produce increasingly poor results. Then humans need to design the mathematical procedures for the AI to be “trained,” and humans often have to intervene forcefully to prevent the AI from breaking the law (by relaying legally sensitive information like how to make explosives or creating images of illegal activity like CSAM). Then, to create the final generated product, the AI needs to be prompted to do so by a human, who needs to write the prompt in such a way that the machine gives them the output they want. The value that AI possesses is the value of embodied human labor within it.

This is plainly not what capitalists believe. They think that AI carries in it the same unique capacity that only human labor power possesses: the ability to create new value beyond that which it cost to produce it. Capitalists do not understand that, out of the portion of capital they advance for means of production, and out of the portion of capital they advance for labor power, it is only the latter that creates new value in excess of that initial advance. To them, it simply appears as a profit in excess of the total cost they paid. While AI’s mystification is particularly intense, the capitalist class has never understood this fact about any machine, or indeed about their entire mode of production: the origin of profit is in the unpaid labor time of workers.

It is no coincidence that AI investment and speculation took off in the last five years, in the wake of COVID’s disruptions and the growing power and militancy of the labor movement that emerged out of them. Capitalists are desperate for the next big technological innovation to save them from the contradictions of capitalism, as Mr. Andreessen himself admitted last month. “If we didn't have AI, we'd be in a panic right now about what's going to happen to the economy,” he said on a podcast, claiming that “declining population” (a racist dog whistle he uses alongside Elon Musk) and “slow productivity growth” would be the “real crisis” that AI is thankfully solving.

What he is facing up to is the idea that without populations of “surplus” human beings to form the reserve army of the unemployed, and with the rate of profit falling continuously as more and more capital becomes advanced and embodied in machines that merely transfer value and do not create it, that capitalists are dinosaurs living on borrowed time. As they look up at the meteor of class struggle and socialism plummeting towards them, they are conjuring phantasms and trying to breathe life into them with dollars and electricity. AI can be a useful tool, a means of production like any other, but it will not save capitalism from itself.

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