HAMISH MCRAE: Pope must remember AI can also be a force for good
The tension between God and mammon has ratcheted up a little in the past few days. On Monday Pope Leo XIV's first encyclical – Magnifica humanitas: On safeguarding the human person in the time of artificial intelligence – set out what he saw as the challenge to humankind of AI.And on Thursday, Anthropic, which created the AI assistant Claude, passed its rival start-up OpenAI in its valuation with a fund-raising valuing it at $965 billion (£715 billion). OpenAI's last funding ranked it at $852 billion.Both enterprises look like being worth more than a trillion dollars if as expected they float on the public markets this autumn.What does this mean for us and our families in our daily lives as workers, savers and investors?It's tricky, and the Pope's encyclical ran to 42,000 words. But his argument, put at its simplest, was that technology was not of itself 'antagonistic to humanity' or 'inherently evil', but nor was it neutral in its impact. He wrote: 'Technology is never neutral because it takes on the characteristics of those who devise, finance, regulate, and use it'.Those characteristics, inevitably, are those of corporate America and particularly of those backing Anthropic and OpenAI. Helping hand: There are downsides to all technologies, but we should recognise these as forces that can improve humankind's welfare as well as increasing its wealthThis is not the place to go into the detail of his case but it's worth noting he specifically calls for AI to be disarmed: it should not be used to dominate our societies or undermine human dignity.Most of us would relate to that. But surely all radical new technologies raise these issues. We've been here before. Is AI really more significant than the printing press, steam engine, motor car – or atom bomb? All new technologies need to be regulated and it takes time to develop the mixture of laws and social customs to ensure that the pluses are amplified and minuses minimised.Motor cars needed road signs, traffic lights, driving tests and seat belts to make motoring safer.We are seeing the damage done to young people by excessive exposure to social media and trying to work out how to contain it.As for finance, some worries are starting to emerge. For example there is a growing trend of people using AI chatbots to make investment decisions for them.But there is no regulation or personalisation. They may simply reinforce the preferences of those who use them, rather than supplying counter-arguments.I'm worried that as more portfolios are driven by AI, markets will become more volatile. After all, we are in an AI-driven boom. At what stage would AI tell a user to de-risk their portfolio and sell their technology stocks so they switch into something more boring? And what happens when AI tells everyone to run for the door at the same moment?But there are potentially huge benefits. For most people the key to building wealth is to start early, focus on equities not bonds and diversify holdings. If AI can use the investment knowledge of a century or so to help them manage their savings simply and cheaply, it could indeed add to their lifetime well-being. And if AI can enable wealth managers to cut charges, that would add to the return on the assets they handle.Think of it this way. Some technologies transform the way we live, but many simply enable ordinary people to enjoy goods or services that previously were only available to the very rich.In the 1950s a Mediterranean holiday was a huge luxury. Now it's seen as normal for a retired couple on a modest income.At the moment only the very wealthy have private offices that manage their family affairs. A generation from now those services could be available for everyone who's comfortably off.Think of that: you don't have to worry about your pension or getting the best deal on a mortgage because there is an AI adviser who does it all for you.There are downsides to all technologies. But we should recognise these as forces that can improve humankind's welfare as well as increasing its wealth.The Pope's encyclical emphasised the negative effects of AI, real and potential, and that's helpful. However, the enthusiasts, the people who are pouring money into Anthropic and OpenAi, should be respected too.DIY INVESTING PLATFORMSAJ BellAJ BellEasy investing and ready-made portfoliosHargreaves LansdownHargreaves LansdownFree fund dealing and investment ideasinteractive investorinteractive investorFlat-fee investing from £4.99 per monthFreetradeFreetradeInvesting Isa now free on basic planTrading 212Trading 212Free share dealing and no account feeAffiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.Compare the best investing account for you
