What is the “dead economic theory” that says AI-driven layoffs will devastate markets and shake democratic systems?

Owen McGrann warned that replacing workers with AI can trigger a chain reaction of job losses, lower consumer spending, and weaker overall demand.

He argued that what looks rational for one company—such as AI-driven layoffs or large bets on automation—can become destructive at the macroeconomic level.

The piece highlighted examples like AI investment surges and Block’s post-layoff stock gains to show how short-term corporate wins may hide broader economic damage.

McGrann also said the long-term risk reaches beyond markets, threatening tax revenues and the financial foundation of democracy.