"AI may transform the economy. That does not guarantee investors will earn back the sums being poured into it."

 Opinion  AI  (artificial intelligence)

The Guardian view on the AI backlash: Silicon Valley’s political power is cracking

Editorial

 

Tech stocks have lost trillions while voters have rejected the industry’s political champions. The billionaire-led boom is facing a democratic reckoning

This week’s midterms showed that the political bill for the AI boom is falling due. The Democratic sweep intensified fears over runaway spending, mounting debt and resistance to datacentres, sending tech shares tumbling. On Thursday Wall Street suffered its worst day since the pandemic as $3.2tn was wiped from markets. Anthropic, developer of the Claude chatbot, is hoping to float within the next fortnight for $1.5tn (£1.1tn), but it may not now get even a trillion dollars. The dominant AI chipmaker Nvidia saw its value crash by more than $400bn. The world’s richest man, Elon Musk, lost $113bn in two days.

While a few very rich people may be a little less wealthy, the sell-off may not be a bad thing. It brings a needed dose of reality to an industry whose spending plans and valuations depend on heroic expectations of future profits. That is a view held by many influential figures – from Goldman Sachs’ research boss to Nobel laureate Daron Acemoğlu. AI may transform the economy. That does not guarantee investors will earn back the sums being poured into it....READ MORE  https://www.theguardian.com/commentisfree/2026/nov/06/the-guardian-view-on-the-ai-backlash-american-voters-want-a-say-in-their-future

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"It more than a little ironic that these experts at tax avoidance are at the helm of a technological revolution that could drive inequality to new, unprecedented heights." Eduardo Porter in The Guardian

Analysis

by  Eduardo Porter

Condemned to plutocracy? The relentless rise of US inequality

Elon Musk is a beneficiary of America’s lopsided prosperity – does the country have any appetite for redistribution?

People protest against the SpaceX IPO in New York. Photograph: Sarah Yenesel/EPA

As Barack Obama’s presidency was coming to a close, Jason Furman, then chairman of the president’s council of economic advisers, laid out the strides his administration had made to curb the nation’s exorbitant income inequality in “the largest investments in reducing inequality since the Great Society”.

Indeed, by the end of 2016, taxes and transfers cut the share of income accruing to the richest 1% of households by just over a fifth, according to estimates from the congressional budget office (CBO), more than under any government since at least Jimmy Carter’s. They raised the slice of income going to the poorest fifth from 3.9% to 7.9%, the highest share since at least 1979.

Those were the days.

As Elon Musk is anointed the world’s first trillionaire, following the public offering of shares of his internet to AI conglomerate SpaceX, that moment, just 10 years ago, when the government bragged about its efforts to curb America’s lopsided distribution of prosperity, might give us some hope that we are not condemned to plutocracy; social and political forces can stop inequality’s relentless rise.

Benjamin Franklin liked to talk of America’s “happy mediocrity” – a country with “few … so miserable as the poor of Europe … few that in Europe would be called rich”. And yet, America’s history of combating inequality is rather grim. Obama’s track record as the United States’s most committed equalizer in over half a century underscores the ultimate lack of interest of the nation’s political coalitions in bringing about a more equitable distribution of the fruits of prosperity.

Supposedly a populist champion of the working stiff, Donald Trump’s priorities quickly turned elsewhere. His Tax Cuts and Jobs Act of 2017 offered massive tax cuts to Americans in the upper percentiles of income... READ MORE  https://www.theguardian.com/us-news/2026/jun/21/us-inequality-plutocracy

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"Speaking to the Guardian, readers in the US echoed the pope’s concerns, describing AI as an “unregulated” industry increasingly being used to the “detriment of too many people”, while also raising fears about surveillance, labor displacement, war and environmental harm."

Pope Leo XIV speaks during a meeting with bishops, members of the clergy and families whose members have been victims of environmental pollution at the Cathedral of Santa Maria Assunta, in Acerra, Italy, on 23 May 2026. Photograph: Ciro De Luca/Reuters

 

Americans echo Pope Leo’s concerns about AI: ‘It threatens workers, privacy and human life’

Guardian readers in the US spoke of fears about unregulated AI in response to the pope’s encyclical warning about the risks of the technology

Maya Yang

Sat 30 May 2026 07.00 EDT

In his first major papal text since assuming leadership of the Catholic church last year, Pope Leo issued a stark warning about the rise of artificial intelligence this week, denouncing the “culture of power” driving the AI age.

Calling for the “most rigorous” ethical constraints on AI – which he described as one of the greatest threats facing humanity today – the first US-born pope also warned of “new forms of slavery” emerging through the digital economy.

Speaking to the Guardian, readers in the US echoed the pope’s concerns, describing AI as an “unregulated” industry increasingly being used to the “detriment of too many people”, while also raising fears about surveillance, labor displacement, war and environmental harm.

For Linda Given, a 74-year-old resident of Boston, Massachusetts, who ran a small gift store in Cambridge for nearly 40 years, the pope’s warning resonated deeply.

“I think he’s right to emphasize the dignity of humans, and to warn that things in the AI field are moving both too fast, and without any significant oversight,” Given said, adding: “To use it as any kind of substitute for human interaction or human agency [is] awful … [and] the entirely likely possibility it could be manipulated to do destructive things.”

Stephen Sincoskie, a 55-year-old print shop supervisor from Howell, New Jersey, expressed similar concerns.

“Unregulated AI is a possible threat to workers, privacy and even human life. Unfortunately, the most corrupt family in politics … is making money to look the other way,” he said. 

“I’m concerned the use of AI will replace workers and assist in the ushering in of a fascistic surveillance state. I do not believe for one second the 1% are interested in paying out guaranteed monthly salaries for everyone to relax and enjoy a career and ‘debt free’ life.”

Others focused on the effect AI is already having on education and critical thinking.

Debra, a 58-year-old college professor in Massachusetts, said she worries students are losing critical thinking skills.

“From my perspective, AI is robbing many students of the need to think critically, learn the ways of research and express themselves by writing,”... READ MORE  https://www.theguardian.com/world/2026/may/30/pope-leo-ai-reaction

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"The chaotic, unique, beautiful Lebanon I knew has been reduced to rubble. When will it end? Suspected war crimes happen almost daily as Israel continues its bombardment, which Unicef estimates is killing nearly 14 children a day. We cannot write this off as just another war in a war-torn region"

‘Lebanese people may have more experience of war, but they do not get used to having their houses bombed.’

Photograph: Mohammed Zaatari/AP

 Arwa Mahdawi

Wed 27 May 2026

There are various reasons why, at 43, I still don’t know how to drive a car. Clumsiness is one. I can’t even walk straight half the time, so I don’t think it’s a good idea that I take control of a 2-tonne vehicle.

Another reason is that my first driving lesson was in Beirut and the experience scarred me for life. The car was falling apart, Lebanese drivers ignore traffic rules and the lesson was in Arabic, which I barely speak. After I had veered on to a busy road the wrong way, my teacher made me get out of the car and yelled at me. I didn’t understand exactly what he was yelling, but it wasn’t good.

Despite that unfortunate incident, Lebanon – chaotic, beautiful, unique Lebanon – has a special place in my heart. When I was 18, my parents moved to Beirut for several years and I visited regularly. We’d go to the ancient ruins in Baalbek; drop by wineries in the Bekaa valley; eat man’oushe in the mountains. We’d do organised hikes, on which there would always be a glamorous woman in heels, full makeup and a designer nose (the Lebanese take grooming and cosmetic surgery very seriously).

Things were never completely calm. Coming home from a swim one summer, my mum narrowly escaped a car bomb intended for a politician. In 2006, my parents were stranded overseas for months because Lebanon and Israel were at war. In 2008, there were a couple of days of clashes that meant my mum and sister couldn’t leave the house.

Still, this was a relatively good time; there was investment, tourism, hope. In January 2009, the New York Times named Beirut its No 1 place to visit that year. With luxury hotels and restaurants opening, the Times said “the capital of Lebanon is poised to reclaim its title as the Paris of the Middle East”.

You may have heard that stupid phrase before: whenever a writer wants to convey to a western audience that Beirut is not some backwater, but a real place full of real people, they reach for it. It’s cringe and orientalist, but it’s also an effective shorthand. And maybe I should have adopted it myself, because what I’m trying to say here, with my walks down memory lane, is that Beirut is not fundamentally different from Paris. People who live in Lebanon, or the Middle East more broadly, are not born with thicker skin. They do not grieve their children less than Europeans do. They may have more experience of war, but they do not get used to having their houses bombed.

Many people seem to think otherwise... READ MORE  https://www.theguardian.com/world/commentisfree/2026/may/27/chaotic-unique-beautiful-lebanon-reduced-rubble-israel-bombardment

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"The olive tree is not just the modern symbol of the Palestinians and their deep roots in the soil of their land, it was always central to their history and economy..." William Dalrymple

William Dalrymple

@DalrympleWill

 

The olive tree is not just the modern symbol of the Palestinians and their deep roots in the soil of their land, it was always central to their history and economy. 

 

Along with cotton, which the Palestinians exported to Marseilles, olive oil and olive soap were major export industries in the early Ottoman period, a reflection of the astonishing number amount of olive trees growing between Jerusalem and Nablus. 

 

The trees were divided into rumani- the big, old spreading ones that dated back to Byzantine times and so were most fruiful- and the more youthful islami ones, those planted under Muslim rule, so younger and therefore less productive and taxed at a lower rate. 

 

Camels carried the oil into town, each one carrying a load of four vessels, while soap was carried out.  The Ottomans taxed camels moving in both directions. 

 

There were at least twelve olive oil soap factories operating in Jerusalem under the Mamluks. 

 

Under early Ottoman rule, the Jerusalem economy greatly enlarged, well-organised guilds were set up and yet more soap factories were built. 

 

The Janisseries in the Citadel and the 'ulama of the al-Aqsa were both heavily invested in the trade. 

 

By the 18thC, the making of olive oil soap had partly migrated to Nablus, which along with Acre became the richest city in the region, largely on the proceeds.

 https://x.com/DalrympleWill/status/2049442291086147772/photo/1

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"Just when the outcome of a war and the stability of global markets hung in the balance, the president chose spectacle over engagement." The Guardian view on US-Iran talks: Trump’s diplomacy falters as risk of war grows

An American blockade in the strait of Hormuz raises energy-market dangers after failed negotiations – pushing a fragile ceasefire closer to collapse

JD Vance in a televised address before he left Islamabad, Pakistan, on 12 April 2026, without a deal. Photograph: Sohail Shahzad/EPA

As the US vice-president, JD Vance, took to a podium in Pakistan after 21 hours of diplomacy and said no deal had been reached to end the war with Iran, his boss Donald Trump was in Miami watching a mixed martial arts fight. The contrast was stark. Just when the outcome of a war and the stability of global markets hung in the balance, the president chose spectacle over engagement. Mr Trump may intend to project strength. But the impression he creates – in Tehran and among America’s allies – is of a president less interested in the substance of diplomacy than in the politics surrounding it.

The talks in Islamabad didn’t fail accidentally; the US and Iran were talking past each other. Washington’s position is that Iran must abandon its capacity to develop a nuclear weapon, while Tehran insists it is not seeking one and has the right to a civilian nuclear programme. The US vice-president’s “final and best offer” would have required Iran to give up that capacity altogether – terms that looked less like the basis of a negotiation than an attempt to impose the conditions of victory.

Washington also wanted free passage through the strait of Hormuz, a vital global energy artery. Tehran, instead, sought control of the strait through transit fees as well as having sanctions lifted, assets unfrozen and reparations paid, alongside a wider regional ceasefire. Given the gap, the positions were never likely to be reconciled in a single round of negotiations. The result was talks without trust – and a war without resolution.

Winston Churchill rightly argued that jaw-jaw is better than war-war. Talks are preferable because fighting is destructive, unpredictable and costly. The irony is that Mr Trump is negotiating over a nuclear programme that was once contained by a deal he ripped up, while trying to reopen a strait closed by an illegal war he chose to start. A deal between Iran and America – however imperfect – would leave the world better off than continued conflict. This is especially true when markets in oil, gas and finance are so intimately linked.

Time is running out to get back to the negotiating table. The fate of the current ceasefire depends not only on Washington and Tehran, but on Israel, whose forces’ expanded campaign in southern Lebanon... READ MORE https://www.theguardian.com/commentisfree/2026/apr/12/the-guardian-view-on-us-iran-talks-trumps-diplomacy-falters-as-risk-of-war-grows

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"Meanwhile, the occupied West Bank is also experiencing its most severe economic downturn on record, with movement and access restrictions and the collapse of jobs"... Israel’s war and restrictions drive Palestinian economy to record collapse. UNCTAD warns two years of attacks and longstanding restrictions have driven occupied Palestinian territory’s economy into its most severe contraction.

Israel’s war and restrictions drive Palestinian economy to record collapse

The economy of the occupied Palestinian territory is facing its most severe collapse on record, driven by the scale of Israel’s genocidal war on Gaza and continued restrictions on movement and trade, according to a new United Nations report.

Published on Monday, the report by the UN Conference on Trade and Development (UNCTAD) said two years of Israeli military operations and longstanding curbs have pushed the occupied territory into an economic downturn now ranked among the 10 worst collapses recorded globally since 1960.

“Extensive damage to infrastructure, productive assets and public services has reversed decades of socioeconomic progress in the Occupied Palestinian Territory,” it said, referring to the Gaza Strip and the West Bank, including East Jerusalem.

The situation in Gaza constitutes “the most severe economic crisis on record”, it warned.

The publication of the findings comes as Israeli attacks on Gaza continue, despite a six-week ceasefire between Israel and the Palestinian group Hamas.

Israel’s assault began on October 7, 2023, after an attack on southern Israel by fighters from Hamas and other Palestinian groups, during which an estimated 1,139 people were killed and about 240 were taken into Gaza as captives.

In response, Israel unleashed a bombing campaign and tightened its longstanding blockade on Gaza, turning what had already been a 16-year siege into a total stranglehold. Its attacks have killed at least 69,733 people and wounded 170,863, with more than 300 killed since the start of the ceasefire last month.

Falling GDP

According to the UNCTAD report, the Palestinian gross domestic product (GDP) had regressed to its 2010 level by the end of last year, while GDP per capita returned to the level seen in 2003, erasing 22 years of development in less than two years.

In Gaza, GDP plunged 83 percent in 2024 compared with the previous year, totalling an 87 percent drop over two years to $362m. GDP per capita plummeted to $161, placing it among the lowest in the world.

The report documented that nearly two decades of Israeli‐imposed blocks on trade, movement and access have generated near-total dependence on external aid, while Israeli attacks have damaged about 174,500 structures in Gaza, propelling the enclave into “utter ruin”.

Meanwhile, the occupied West Bank is also experiencing its most severe economic downturn on record, with movement and access restrictions and the collapse of jobs. 

“Across the Occupied Palestinian Territory, the steepest economic contraction on record has wiped out decades of progress,” the report added.

The report says Israel’s withholding of fiscal revenues owed to the Palestinian Authority (PA) has significantly worsened the crisis, severely limiting the government’s ability to pay salaries, maintain services and finance reconstruction efforts.

The PA said on Monday that Israel was withholding $4bn of tax revenues.

The road to recovery

UNCTAD estimated that the cost of reconstruction and recovery in Gaza alone will exceed $70bn and called for a comprehensive recovery plan that is backed by coordinated international assistance, the restoration of fiscal transfers and urgent measures to ease constraints on trade, movement and investment.

“Even with substantial aid, recovery to pre-October 2023 GDP levels could take decades,” it said.

The agency also warned that without immediate, large-scale intervention, the destruction caused by Israel’s war and systemic restrictions will trap the Palestinian economy in a long-term slump.

For any meaningful recovery, UNCTAD said, the ceasefire achieved in October must be durable.

“UNCTAD’s report calls for immediate and substantial intervention by the international community to halt the economic freefall, address the humanitarian crisis, and lay the groundwork for lasting peace and development,” it added.

https://www.aljazeera.com/news/2025/11/25/israels-war-on-gaza-curbs-drive-palestinian-economy-to-record-collapse 

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