Acemoglu urges Democrats to rebuild working-class appeal

Daron Acemoglu urges Democrats to combine economic reform with cultural restraint, arguing that liberalism must address its estrangement from workers.

The MIT economist and Nobel laureate argues that defending liberal democracy requires changing the center-left’s economic priorities, not simply resisting its political opponents. In an interview, he linked its electoral difficulties to diminished opportunities for workers and a cultural agenda he considers too prescriptive.

Workers anchor Acemoglu’s political diagnosis

His book, What Happened to Liberal Democracy: Remaking a Politics of Shared Prosperity, examines the political tradition associated with Franklin Roosevelt and European social democrats. Rather than organizing his argument around President Trump, Acemoglu scrutinizes the failures of liberalism’s own governing coalition.

Acemoglu attributes the fracture to an economic transition that rewarded businesses and educated professionals while leaving other workers behind. In his account, globalization and digital tools enabled companies to increase earnings with fewer employees, while voters with degrees increasingly supported center-left parties and working-class voters shifted rightward.

As evidence, he said real wages among US men lacking college degrees declined between 1980 and approximately 2013, despite growth in the overall economy. He also argued that these communities experienced pressure to abandon established values, adding cultural alienation to financial disappointment.

Acemoglu supports the objectives of diversity and inclusion initiatives but objects to their implementation by powerful institutions and social groups. His criticism concerns who sets cultural expectations and how, rather than a rejection of inclusion itself.

Tax changes meet coalition constraints

His economic proposal would align the taxation of income earned from capital with the treatment of earnings from work. Acemoglu argues that this would expand government revenue and reduce tax incentives that encourage businesses to substitute machines for employees.

He acknowledged that capital might relocate in response, while maintaining that most businesses have durable national ties. That tension matters to his prescription: if companies remain, the revenue mechanism he describes has more scope to operate; if investment moves abroad, his case faces the constraint he identifies.

Acemoglu praised New York Mayor Zohran Mamdani’s political appeal and attention to household affordability, but questioned whether his approach could attract working-class voters beyond the city. He identified Representative Ro Khanna and Senator Jon Ossoff as preferable examples of combining economic ambition with a message of unity.

AI priorities enter the economic argument

Acemoglu extends his argument about economic priorities to artificial intelligence. He acknowledged that agentic AI developed sooner than he anticipated, but said deployment across production remained less advanced than public discussion implied, identifying coding as the exception.

He criticized the pursuit of artificial general intelligence, arguing that it diverts attention from tools designed to improve workers’ capabilities and strengthen citizens’ agency. He also said China was integrating AI into economic activity faster despite trailing in frontier models; that comparison remains his assessment.

Under the alternative Acemoglu advocates, AI investment would prioritize helping people perform their jobs rather than replacing them. If that approach gains support, worker productivity becomes the test for technology policy; if the industry retains its current priorities, his concern about neglected alternatives remains unresolved.

His institutional proposals include oversight of social-media recommendation systems rather than speech restrictions, alongside a prohibition on corporate campaign donations that preserves personal contributions. For Acemoglu, the democratic issue is whether citizens help determine how transformative technologies develop, rather than merely adapt to decisions made by their producers.