Artificial intelligence is reshaping economies, politics, and society at an unprecedented pace. While the technology offers the potential for innovation, efficiency, and economic growth, it also threatens to deepen inequality, concentrate corporate power, and erode democratic institutions if left unchecked, according to Joseph Stiglitz, a Nobel laureate and professor of economics at Columbia Business School.
As governments around the world struggle to regulate this rapidly evolving technology, a crucial question emerges: How do we ensure AI serves the common good rather than becoming a tool for exploitation? Therein lies a debate over the meaning of freedom and the role of government in protecting it.
In his latest book, The Road to Freedom, Stiglitz argues that true freedom isn’t about the absence of regulation — it is about creating fair rules that prevent corporate dominance and protect individual rights. He warns that without stronger intellectual property protections, fair competition laws, and accountability measures, AI could become yet another force reinforcing economic and social disparities.
“The concept of freedom is something that everybody, everywhere in the world, holds dear. But it is clear to me that many people don’t understand what is really meant by freedom, they don’t understand that one person's freedom is related very much to another's. What one person could do can restrict the freedom of others,” Stiglitz says.
In a recent Q&A, Stiglitz discusses the urgent need for policies that balance innovation with responsibility, the risks of allowing tech giants to dictate the future, and why an economic framework of progressive capitalism is essential for safeguarding democracy in the age of AI.
CBS Insights: What are the risks of AI when it comes to global freedom?
Joseph Stiglitz: AI has the prospect of being very transformative. It has the prospect of increasing GDP. But, at the same time, it has the prospects of increasing inequality, creating more unemployment and exacerbating the inequalities in our society and polarization, which is already so large, and accelerating many of the arms that we recognize arose out of social media and the internet.
AI can also increase mis- and disinformation, targeting people with the messages that polarize our society, undermining what's sometimes called the information ecosystem, leading, in some cases, to violence. So while there's a lot of potential, there are an awful lot of risks.
CBS Insights: What role do businesses play in these risks?
Stiglitz: AI raises not only new challenges for antitrust law and competition law, but it also raises new questions about intellectual property. What has become very clear is that intermediaries like Google and Facebook have appropriated intellectual property from legacy media. Now it's very clear that AI companies like OpenAI have appropriated a lot of the intellectual property of Google and the legacy media, and it appears that some of the newer AI companies have appropriated some of the intellectual property of the older AI companies.
It's a mess, but it's a mess where some of the people, the greedy companies in the middle, the artificial intelligence companies, have taken, you might say, a very consistent stand. ‘We have the right to take everybody else's property, intellectual property, but nobody has the right to take ours.’
What you expect from American-style capitalism, it won't work. You have to compensate those who are producing the basic knowledge that goes into AI. And that means you have to give compensation to the legacy media. And that means you have to start enforcing the intellectual property laws or rewriting them to reflect the contribution they are making and you have to have competition laws that level the bargaining power and limit the bargaining power of the market power of these large behemoths.
CBS Insights: What does freedom mean to you in the age of AI?
Stiglitz: The concept of freedom is something that everybody, everywhere in the world, holds dear. But it is clear to me that many people don’t understand what is really meant by freedom. They don’t understand that one person's freedom is related very much to another's. What one person could do can restrict the freedom of others.
It is also clear to me that, particularly on the political right in the United States, this misunderstanding has had profound effects. We see the Freedom Caucus in the Republican Party actually promoting policies and actions that would reduce the freedom of large fractions of Americans.
CBS Insights: How does your book, The Road to Freedom contribute to these ideas?
Stiglitz: I wrote the book to help clarify the idea of freedom and what kinds of policies, what kind of economy, would best advance the freedom in a meaningful sense of the most people.
A central idea in the book is to explore how, in a whole variety of contexts, one person's freedom encroaches on that of another. If somebody pollutes, it endangers our whole world, it may result in somebody with asthma dying. So, the freedom of one has caused a loss of freedom in a very fundamental sense to others. We have to have discussions on how you balance those freedoms. It's pretty clear to me that any rational society would want to restrict unnecessary pollution – take away the right to pollute – because other people’s right to live is more important than the right to pollute.
After one has a democratic dialogue on that balancing, you need to have rules and regulations. That's where the government comes in to say ‘you are encroaching on the freedom of somebody else and you can't do that.’
CBS Insights: In a world of increasing misinformation, how can regulators earn the trust of the citizenry?
Stiglitz: It's obviously important that citizens believe that the rules are fair and fairly enforced. And quite honestly, we face a problem today because there's been a loss of trust in government. But it's a loss of trust in government that's been, to at least a significant extent, advanced by those who want to decrease the role of government. The polluters don't like the restrictions on polluting.
One of the purposes of the book is to try to enhance the understanding of why we must have these regulations. The Ten Commandments was a set of regulations, and we've lived with that for thousands of years. To understand why it is that every civilization needs a set of rules and a government to enforce them, and that modern societies based in democracy have democratic ways of adopting them.
If we can understand both why we need government and why there are special interests trying to undermine government, maybe we can restore trust in government.
CBS Insights: In your book you mention the need for a progressive economy rather than a free market economy. Why is the former a core part of attaining freedom?
Stiglitz: Adam Smith, who is often thought of as the father of modern economics, was much more attuned to my perspective on economics and society than to the free marketeers who have been claiming him as their hero, just like they claim freedom for themselves. They didn't understand freedom, and unfortunately, they all didn't understand Adam Smith.
What Adam Smith did talk about was that markets have forces at play that lead to efficiency and the well-being of society, but he was also clear that there are many other forces going in the other direction. I as an economist understand the importance of incentives and the forces that make for how the private sector can play an important role in the economy. But there are limits, And Adam Smith was very aware of those limits.
One of the important areas where government regulation is needed is to make sure you have competition. We all know about monopolies and how they can have the power to raise prices. Adam Smith was very clear: he believed that people with business seldom get together without conspiring against the public interest to raise prices. He also discussed how they got together to depress wages. And he actually supported the idea of unions as a way of workers getting together to balance the power a little bit better. He also clearly understood the role of government in promoting education and in regulation.
