I need help from my betters.

I have heard the following argument several time :

"There are two ways out of the gigantic pile of debt countries have amassed over the past 50 years:

a) Financial repression through inflation. Paying old debt with freshly printed, debased dollars, hurting savers, and probably leading to social unrest/possible hyperinflation.

b) Enormous productivity gains. Before "Atomic Fusion" was the leading theory, now it's the emerging "AI/AGI" narrative.

I certainly agree with a), that's my base case.

However, regarding b), I don't see how productivity gains through AI would fix the debt situation, or our societies in any way.

The current AI is leading us to the "Automation Revolution", which allows a few skilled engineers to automate complex processes, by being assisted by unlimited superhuman assistants, which costs a fraction of human labor, are pretty malleable, reliable, and can learn to do any digital task you want.

Today, processes usually involve 2 to 100+ persons, and the timeframe and costs are correlated with the amount of persons involved in said processes.

The final cost and final time spent on a project are usually exponential.

AI, on the other hand, will have a rather linear time spent and cost, however big or small the project is, and it's easy to envision a team of 5 skilled engineers replacing (at least) 50-100 other person on a given project.

In this reality, I find really hard to believe that most of these 50 replaced persons will be able to find work in the same industry (if they were replaced, they didn't make the cut...).

Since another strong suit of AI is the ability to keep repeating/improving a project at very low cost, which then you can sell as a product/API, the incentive is to have the few best engineers/prompters leveraging AI as much as possible.

So, if we remove even just 30% (low estimate) of the white collar jobs due to "productivity" gains, these people will have to find a new line of work, which will probably pay them less... or will just have to stop working due to depression.

Meanwhile, the elite engineers working on developing/prompting AI will probably get paid much more than before, leading to even more wealth concentration.

Which forces me to think that with the coming automation of so many jobs, the only way out of it in a fiat world will be to print money. This will probably be done through UBI, most likely branded something like "Solidarity Tax", levied in a small part through special "token" taxes on AI company for political theater, and in a big part from printing money... which is basically the same result as a).

Am I missing something, or is something just wrong in my line of reasoning ?

Would love to have anyone's insight about it, and maybe some esteemed minds like #[0]​ #[1]​ #[2]​ can also chime in!

If you read til here, thank you. 🙏