Business

BlackRock’s billionaire CEO warns AI could be capitalism’s next big failure after 30 years of unsustainable inequality after the Cold War

Published

4 hours ago

January 20, 2026

BlackRock CEO Larry Fink opened the World Economic Forum in Davos, Switzerland, with a stark message to the global elite: AI’s unfettered growth risks pummelling the world’s working and professional classes. Beyond that, he warned that it could be capitalism’s next big failure after a 30-year reign after the Cold War that has failed to deliver for the average human being in society.

In his opening remarks on Tuesday at the gathering of thousands of executives and global leaders, the billionaire boss of the world’s largest asset manager—often called one of Wall Street’s “Masters of the Universe”—said that as those in power discuss the future of AI, they risk leaving behind the vast majority of the world, just as they have for much of the last generation.

“Since the fall of the Berlin Wall, more wealth has been created than in any time prior in human history, but in advanced economies, that wealth has accrued to a far narrower share of people than any healthy society can ultimately sustain,” Fink said.

Fink, who has used his annual BlackRock letters and annual appearances at Davos to set the agenda for a more progressive kind of capitalism, even one that is arguably “woke,” making him at times the face of ESG and of stakeholder capitalism, warned that the gains of the tremendous wealth creation since the 1990s have not been equitably shared. And the capitalist ideology driving AI development and implementation forward could come at the expense of the wage-earning majority, he added.

“Early gains are flowing to the owners of models, owners of data and owners of infrastructure,” Fink said. “The open question: What happens to everyone else if AI does to white-collar workers what globalization did to blue-collar workers? We need to confront that today directly. It is not about the future. The future is now.”

Fink’s past critiques of capitalism

Fink, who was appointed interim co-chair of the World Economic Forum in August 2025, replacing founder Klaus Schwab, has long espoused the reshaping of capitalism, seeing it as a responsibility of large asset managers like himself. Fink was formerly vociferous about the importance of environmental, social, and corporate governance (ESG) investing, and has argued that climate change is reshaping finance, creating an imperative for executives to reallocate their capital to address the crisis accordingly. In a 2022 letter to investors, published the day before the Davos summit, Fink emphasized a model of “stakeholder capitalism” of a business’s mandate to serve not just shareholders, but employees, consumers, and the public.

Fink’s new primacy in Davos is the first without Schwab, following allegations that he had expensed more than $1 million, billed to the World Economic Forum, on questionable travel spending, as well as claims of workplace misconduct and research report manipulation. The BlackRock chief emphasized the need for the gathering to demonstrate its legitimacy in part by showing that it’s concerned with more than just swelling growth of companies and countries, but also the economic welfare of its employees and citizens.

“Many of the people most affected by what we talk about here will never come to this conference,” Fink said. “That’s a central tension of this forum. Davos is an elite gathering trying to shape a world that belongs to everyone.”

Though BlackRock announced in early 2025 it would roll back many of the diversity, equity, and inclusion goals it created a few years before, Fink has once again used his spotlight to call on leaders to transform their capitalist sensibilities, this time in how they imagine the AI future.

The cost of the AI boom

Last year capped an explosion of growth in the AI sector, with Morningstar analysts finding a group of 34 AI stocks, including Amazon, Alphabet, and Microsoft, shot up 50.8% in 2025. AI firms and investors have seen their wealth skyrocket in the past year, with Per the Bloomberg Billionaires Index, the median increase in net worth last year was nearly $10 billion among the 50 wealthiest Americans. Google co-founder Larry Page and Sergey Brin, for example, got $101 billion and $92 billion richer, respectively, in 2025.

The BlackRock CEO noted these gains, however, have been reserved for the richest few, alluding to a K-shaped economy of the rich getting richer, while the poor continue to struggle: The bottom half of Americans, in short, are not cashing in on the AI race. Although Fink didn’t get into the politics of utilities setting electricity prices, it seems the poor are actually paying higher bills to support the data centers powering the AI boom. According to Federal Reserve data, the poorer demographic owns about 1% of stock market wealth, translating to about 165 million people owning $628 billion in stock. Conversely, the top 1% of wealthiest households own nearly 50% of corporate equity.

Fink’s framing of the post-Cold War era as one of exploding inequality represents a mainstreaming of a once niche view that has become increasingly mainstream in the 21st century. While the triumph of the west over communism was seen as the ultimate victory for capitalism, as epitomized by Francis Fukuyama’s The End of History and the Last Man, history has in fact continued. The unprecedented rise of China as an economic superpower, through its fusion of socialism and capitalism “with Chinese characteristics,” has complicated the narrative, as has the inequality alluded to by Fink.

An internal critic of the post-Cold War world order is Andrew Bacevich, a military veteran and historian who likened the collapse of the Soviet Union in 1989 as “akin to removing the speed limiter from an internal combustion engine.” Bacevich’s 2020 book The Age of Illusions: How America Squandered Its Cold War Victory, was an early articulation of the once niche viewpoint that Fink lent support to on Tuesday.

What AI’s growth means for workers

Similarly, the risks of the AI boom on workers extends beyond who has a stake in the technology industry’s growth. Nobel laureate and “godfather of AI” Geoffrey Hinton has previously warned this explosion of wealth for the few will come at the expense of white-collar workers, who will be displaced by the technology.

“What’s actually going to happen is rich people are going to use AI to replace workers,” Hinton said in September. “It’s going to create massive unemployment and a huge rise in profits. It will make a few people much richer and most people poorer. That’s not AI’s fault, that is the capitalist system.”

Some companies have already leaned into culling headcount to grow profits, including enterprise-software firm IgniteTech. CEO Eric Vaughan laid off nearly 80% of his staff in early 2023, according to figures reviewed by Fortune. Vaughan said the reductions happened during an inflection point in the tech industry, where failure to efficiently adopt AI could be fatal for a company. He’s since rehired for all of those roles, and he would make the same choice again today, he told Fortune.

According to Fink, sustaining a white-collar workforce will depend on the world’s most powerful people creating an actionable plan that will defy the critiques of capitalism that has, so far, stood to predominantly benefit them.

“Now with abstractions about the jobs of tomorrow, but with a credible plan for broad participation in these gains, this is going to be the test,” Fink said. “Capitalism can evolve to turn more people into owners of growth, instead of spectators watching it happen.”

This story was originally featured on Fortune.com

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Business

AI is boosting productivity. Here’s why some workers feel a sense of loss

Published

2 minutes ago

January 20, 2026

Jace Porter

Welcome to Eye on AI, with AI reporter Sharon Goldman. In this edition…Why some workers feel a sense of loss while AI boosts productivity…Anthropic raising fresh $10 Billion at $350 billion valuation…Musk’s xAI closed $20 billion funding with Nvidia backing…Can AI do your job? See the results from hundreds of tests.

For months, software developers have been giddy with excitement over “vibe coding”– prompting desired software functions or features in natural language—with the latest AI code generation tools. Anthropic’s Claude Code is the darling of the moment, but OpenAI’s Codex, Cursor and other tools have also led engineers to flood social media with examples of tasks that used to take days and are now finished in minutes.

Even veteran software design leaders have marvelled at the shift. “In just a few months, Claude Code has pushed the state of the art in software engineering further than 75 years of academic research,” said Erik Meijer, a former senior engineering leader at Meta.

Skills honed seem less essential

However, that same delight has turned disorienting for many developers, who are grappling with a sense of loss as skills honed over a lifetime suddenly seem less essential. The feeling of flow—of being “in the zone”—seems to have vanished as building software becomes an exercise in supervising AI tools rather than writing code.

In a blog post this week titled “The Grief When AI Writes All the Code,” Gergely Orosz of The Pragmatic Engineer, wrote that he is “coming to terms with the high probability that AI will write most of my code which I ship to production.” It already does it faster, he explained, and for languages and frameworks he is less familiar with, it does a better job.

“It feels like something valuable is being taken away, and suddenly,” he wrote. “It took a lot of effort to get good at coding and to learn how to write code that works, to read and understand complex code, and to debug and fix when code doesn’t work as it should.”

Andrew Duca, founder of tax software Awaken Tax, wrote a similar post this week that went viral, saying that he was feeling “kinda depressed” even though he finds using Claude Code “incredible” and has “never found coding more fun.”

He can now solve customer problems faster, and ship more features, but at the same time “the skill I spent 10,000s of hours getting good at…is becoming a full commodity extremely quickly,” he wrote. “There’s something disheartening about the thing you spent most of your life getting good at now being mostly useless.”

Software development has long been on the front lines of the AI shift, partly because there are decades of code, documentation and public problem-solving (from sites like GitHub) available online for AI models to train on. Coding also has clear rules and fast feedback – it runs or it doesn’t – so AI systems can easily learn how to generate useful responses. That means programming has become one of the first white-collar professions to feel AI’s impact so directly.

These tensions will affect many professions

These tensions, however, won’t be confined to software developers. White-collar workers across industries will ultimately have to grapple with them in one way or another. Media headlines often focus on the possibility of mass layoffs driven by AI; the more immediate issue may be how AI reshapes how people feel about their work. AI tools can move us past the hardest parts of our jobs more quickly—but what if that struggle is part of what allows us to take pride in what we do? What if the most human elements of work—thinking, strategizing, working through problems—are quietly sidelined by tools that prize speed and efficiency over experience?

Of course, there are plenty of jobs and workflows where most people are very happy to use AI to say buh-bye to repetitive grunt work that they never wanted to do in the first place. And as Duca said, we can marvel at the incredible power of the latest AI models and leap to use the newest features even while we feel unmoored.

Many white-collar workers will likely face a philosophical reckoning about what AI means for their profession—one that goes beyond fears of layoffs. It may resemble the familiar stages of grief: denial, anger, bargaining, depression, and, eventually, acceptance. That acceptance could mean learning how to be the best manager or steerer of AI possible. Or it could mean deliberately carving out space for work done without AI at all. After all, few people want to lose their thinking self entirely.

Or it could mean doing what Erik Meijer is doing. Now that coding increasingly feels like management, he said, he has turned back to making music—using real instruments—as a hobby, simply “to experience that flow.”

With that, here’s more AI news.

Sharon Goldman
sharon.goldman@fortune.com
@sharongoldman

FORTUNE ON AI

As Utah gives the AI power to prescribe some drugs, physicians warn of patient risks – by Beatrice Nolan

Google and Character.AI agree to settle lawsuits over teen suicides linked to AI chatbots – by Beatrice Nolan

OpenAI launches ChatGPT Health in a push to become a hub for personal health data – by Sharon Goldman

Google takes first steps toward an AI product that can actually tackle your email inbox – by Jacqueline Munis

Fusion power nearly ready for prime time as Commonwealth builds first pilot for limitless, clean energy with AI help from Siemens, Nvidia – by Jordan Blum

AI IN THE NEWS

Anthropic raising fresh $10 Billion at $350 billion valuation. According to the Wall Street Journal, OpenAI rival Anthropic is planning to raise $10 billion at a roughly $350 billion valuation, nearly doubling its worth from just four months ago. The round is expected to be led by GIC and Coatue Management, following a $13 billion raise in September that valued the company at $183 billion. The financing underscores the continued boom in AI funding—AI startups raised a record $222 billion in 2025, per PitchBook—and comes as Anthropic is also preparing for a potential IPO this year. Founded in 2021 by siblings Dario Amodei and Daniela Amodei, Anthropic has become a major OpenAI rival, buoyed by Claude’s popularity with business users, major backing from Nvidia and Microsoft, and expectations that it will reach break-even by 2028—potentially faster than OpenAI, which is itself reportedly seeking to raise up to $100 billion at a $750 billion valuation.

Musk’s xAI closed $20 billion funding with Nvidia backing. Bloomberg reported that xAI, the AI startup founded by Elon Musk, has completed a $20 billion funding round backed by investors including Nvidia, Valor Equity Partners, and the Qatar Investment Authority, underscoring the continued flood of capital into AI infrastructure. Other backers include Fidelity Management & Research, StepStone Group, MGX, Baron Capital Group, and Cisco’s investment arm. The financing—months in the making—will fund xAI’s rapid infrastructure buildout and product development, the company said, and includes a novel structure in which a large portion of the capital is tied to a special-purpose vehicle used to buy Nvidia GPUs that are then rented out, allowing investors to recoup returns over time. The deal comes as xAI has been under fire for its chatbot Grok producing non-consensual “undressing” images of real people.

Can AI do your job? See the results from hundreds of tests. I wanted to shout-out this fascinating new interactive feature in the Washington Post, which presented a new study that found that despite fears of mass job displacement, today’s AI systems are still far from being able to replace humans on real-world work. Researchers from Scale AI and the Center for AI Safety tested leading models from OpenAI, Google, and Anthropic on hundreds of actual freelance projects—from graphic design and creating dashboards to 3D modeling and games—and found that the best AI systems successfully completed just 2.5% of tasks on their own. While AI often produced outputs that looked plausible at first glance, closer inspection revealed missing details, visual errors, incomplete work, or basic technical failures, highlighting gaps in areas like visual reasoning, long-term memory, and the ability to evaluate subjective outcomes. The findings challenge predictions that AI is poised to automate large swaths of human labor anytime soon, even as newer models show incremental improvement and the economics of cheaper, semi-autonomous AI work continue to put pressure on remote and contract workers.

EYE ON AI NUMBERS

91.8%

That’s the percentage of Meta employees who admitted to not using the company’s AI chatbot, Meta AI, in their day-to-day work, according to new data from Blind, a popular anonymous professional social network.

According to a survey of 400 Meta employees, only 8.2% said they use Meta AI. The most popular chatbot was Anthropic’s Claude, used by more than half (50.7%) of Meta employees surveyed. 17.7% said they use Google’s Gemini and 13.7% said they used OpenAI’s ChatGPT.

When approached for comment, Meta spokesperson pointed out that the number (400 of 77,000+ employees) is “not even a half percent of our total employee population.”

AI CALENDAR

Jan. 19-23: World Economic Forum, Davos, Switzerland.

Jan. 20-27: AAAI Conference on Artificial Intelligence, Singapore.

Feb. 10-11: AI Action Summit, New Delhi, India.

March 2-5: Mobile World Congress, Barcelona, Spain.

March 16-19: Nvidia GTC, San Jose, Calif.

April 6-9: HumanX, San Francisco.

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Business

Trust has become the crisis CEOs can’t ignore at Davos, as new data show 70% of people turning more ‘insular’

Published

33 minutes ago

January 20, 2026

Jace Porter

Everywhere you turn in Davos this year, people are talking about trust. And there’s no one who knows trust better than Richard Edelman. Back in 1999, Edelman was on the cusp of taking over the PR firm founded by his father Daniel. Spurred by the 1999 WTO protests in Seattle, he decided to try and measure the level of trust in NGOs compared with business, government and media, Edelman surveyed 1,300 thought leaders in the U.S., U.K., France, Germany and Australia, and the Edelman Trust Barometer was born.

While the survey sample long ago expanded beyond elites to include about 34,000 respondents in 28 nations, its results are still unveiled and debated every year at the ultimate gathering of elites: the World Economic Forum. This year’s findings are grim: About 70% of respondents now have an “insular” mindset: they don’t want to talk to, work for, or even be in the same space with anyone who doesn’t share their world view. And “a sense of grievance” permeates the business world, Edelman finds. At Davos, debating such findings have spawned a series of dinners, panels, cocktails and media briefings on site. What better place to bring people together than the world’s most potent village green?

I moderated a CEO salon dinner with about three dozen leaders last night to discuss what they’re seeing and doing when it comes to building trust. Before the dinner, I asked Edelman what he’d like to see this year, after 26 winters of highlighting the erosion of trust. “Urgency,” he said. “A sense that time is running out.”

Because the gathering itself was held under the Chatham House rule, I won’t share names and direct quotes. But the focus was on how attendees are trying to address the problem through what Edelman calls “trust brokering,” or finding common ground through practices from nonjudgemental communications to “polynational’ business models that invest in long-term local relationships. (See the report for more information.) There were some success stories from the front lines of college campuses, politics and industries caught in a crossfire of misinformation.

Still, the mood was somewhat subdued, with a sense that there’s no easy fix to building trust. As one CEO pointed out, rarely have leaders faced such a confluence of geopolitical crises, tech shifts, economic divides, disinformation, job disruption and wicked problems. And as much as Davos is a great gathering ground to talk through all of these problems, the fact is the problems will all still be waiting once these CEOs return from the mountains.

This story was originally featured on Fortune.com

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History says there’s a 90% chance that Trump’s party will lose seats in the midterm elections. It also says there’s a 100% chance

Published

1 hour ago

January 20, 2026

Jace Porter

Now that the 2026 midterm elections are less than a year away, public interest in where things stand is on the rise. Of course, in a democracy no one knows the outcome of an election before it takes place, despite what the pollsters may predict.

Nevertheless, it is common for commentators and citizens to revisit old elections to learn what might be coming in the ones that lie ahead.

The historical lessons from modern midterm congressional elections are not favorable for Republicans today.

Most of the students I taught in American government classes for over 40 years knew that the party in control of the White House was likely to encounter setbacks in midterms. They usually did not know just how settled and solid that pattern was.

Since 1946, there have been 20 midterm elections. In 18 of them, the president’s party lost seats in the House of Representatives. That’s 90% of the midterm elections in the past 80 years.

Measured against that pattern, the odds that the Republicans will hold their slim House majority in 2026 are small. Another factor makes them smaller. When the sitting president is “underwater” – below 50% – in job approval polls, the likelihood of a bad midterm election result becomes a certainty. All the presidents since Harry S. Truman whose job approval was below 50% in the month before a midterm election lost seats in the House. All of them.

Even popular presidents – Dwight D. Eisenhower, in both of his terms; John F. Kennedy; Richard Nixon; Gerald Ford; Ronald Reagan in 1986; and George H. W. Bush – lost seats in midterm elections.

The list of unpopular presidents who lost House seats is even longer – Truman in 1946 and 1950, Lyndon B. Johnson in 1966, Jimmy Carter in 1978, Reagan in 1982, Bill Clinton in 1994, George W. Bush in 2006, Barack Obama in both 2010 and 2014, Donald Trump in 2018 and Joe Biden in 2022.

Exceptions are rare

There are only two cases in the past 80 years where the party of a sitting president won midterm seats in the House. Both involved special circumstances.

In 1998, Clinton was in the sixth year of his presidency and had good numbers for economic growth, declining interest rates and low unemployment. His average approval rating, according to Gallup, in his second term was 60.6%, the highest average achieved by any second-term president from Truman to Biden.

Moreover, the 1998 midterm elections took place in the midst of Clinton’s impeachment, when most Americans were simultaneously critical of the president’s personal behavior and convinced that that behavior did not merit removal from office. Good economic metrics and widespread concern that Republican impeachers were going too far led to modest gains for the Democrats in the 1998 midterm elections. The Democrats picked up five House seats.

The other exception to the rule of thumb that presidents suffer midterm losses was George W. Bush in 2002. Bush, narrowly elected in 2000, had a dramatic rise in popularity after the Sept. 11 attacks on the World Trade Center and the Pentagon. The nation rallied around the flag and the president, and Republicans won eight House seats in the 2002 midterm elections.

Those were the rare cases when a popular sitting president got positive House results in a midterm election. And the positive results were small.

The final – and close – tally of the House of Representatives’ vote on President Donald Trump’s tax bill on July 3, 2025. Alex Wroblewski / AFP via Getty Images

Midterms matter

In the 20 midterm elections between 1946 and 2022, small changes in the House – a shift of less than 10 seats – occurred six times. Modest changes – between 11 and 39 seats – took place seven times. Big changes, so-called “wave elections” involving more than 40 seats, have happened seven times.

In every midterm election since 1946, at least five seats flipped from one party to the other. If the net result of the midterm elections in 2026 moved five seats from Republicans to Democrats, that would be enough to make Democrats the majority in the House.

In an era of close elections and narrow margins on Capitol Hill, midterms make a difference. The past five presidents – Clinton, Bush, Obama, Trump and Biden – entered office with their party in control of both houses of Congress. All five lost their party majority in the House or the Senate in their first two years in office.

Will that happen again in 2026?

The obvious prediction would be yes. But nothing in politics is set in stone. Between now and November 2026, redistricting will move the boundaries of a yet-to-be-determined number of congressional districts. That could make it harder to predict the likely results in 2026.

Unexpected events, or good performance in office, could move Trump’s job approval numbers above 50%. Republicans would still be likely to lose House seats in the 2026 midterms, but a popular president would raise the chances that they could hold their narrow majority.

And there are other possibilities. Perhaps 2026 will involve issues like those in recent presidential elections.

Close results could be followed by raucous recounts and court controversies of the kind that made Florida the focal point in the 2000 presidential election. Prominent public challenges to voting tallies and procedures, like those that followed Trump’s unsubstantiated claims of victory in 2020, would make matters worse.

The forthcoming midterms may not be like anything seen in recent congressional election cycles.

Democracy is never easy, and elections matter more than ever. Examining long-established patterns in midterm party performance makes citizens clear-eyed about what is likely to happen in the 2026 congressional elections. Thinking ahead about unusual challenges that might arise in close and consequential contests makes everyone better prepared for the hard work of maintaining a healthy democratic republic.

Robert A. Strong, Senior Fellow, Miller Center, University of Virginia

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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