Marxism and the Specter of AI: The Labor Theory of Value, Immiseration, and Post-Labor Political Economy

This paper argues that the development of artificial intelligence represents a simultaneous refutation and vindication of Marx’s two central predictions about capitalism’s internal dynamics. Marx held that capitalism would collapse under its own contradictions for two primary reasons: first, the tendency of the rate of profit to fall, grounded in the labor theory of value and the claim that only living labor produces surplus value; second, the immiseration thesis, which predicted that the structural dynamics of capital accumulation would concentrate wealth to such a degree that the material conditions of the majority would become intolerable. I argue that AI decisively refutes the first thesis while vindicating the second through a novel and more severe mechanism than Marx envisioned. The refutation of the labor theory of value stems from a philosophical error in Marx’s Aristotelian inheritance—the assumption that purposive productive activity requires teleological agency of a kind only living beings possess. A functionalist account of intelligence demonstrates that this assumption is untenable, and that AI systems can and do produce economic value without living labor. The vindication of the immiseration thesis follows from the structural consequence of labor’s displacement: capital no longer requires labor to generate returns, eliminating the structural leverage that historically grounded labor politics and producing immiseration not through exploitation but through irrelevance. The paper further develops the empirical case for this vindication by examining the current trajectory of AI development through a tripartite taxonomy of barriers to disruption—ontological, technical, and material—and argues that none of these barriers is sufficient to forestall the displacement of cognitive labor at scale, although material constraints may modulate its pace. The paper concludes by developing a commons-based normative framework for redistribution in a post-labor economy, grounded in the claim that humanity’s collective cognitive output constitutes an appropriated commons from which AI capability was extracted.