Poverty in the midst of abundance: AI will make goods cheaper, but your labor will get cheaper faster

Very simple idea, but I thought it'd be worth making a post on this.

Some people are saying AI will make all goods cheaper, so you'll be able to afford a nicer life by working. Without any redistribution, just by market mechanisms. These people are wrong.

AI will lower the price of goods you need to survive, and also the price of your labor. The question is which will get cheaper faster. Let's use energy cost as a proxy. A day's worth of labor equivalent to yours can be done by AI for just a few cents in electricity on tokens. But feeding you with e.g. apples for a day will cost more energy than that, because growing apples can only be energy-optimized so far. So selling your labor at market price will leave you unable to afford apples.

This means a future with economic AI might look like "poverty in the midst of abundance": all goods are cheap, but somehow you can't find a job paying even that much. In economic terms, many previous inventions were complements to human labor, while AI is a general substitute for human labor, lowering its exchange rate vs other goods.

Maybe the problem can be solved by redistribution, or by everyone having investments, or something else - that's a bigger discussion. In this post I just want to make the basic point above.