The Ultimate Crime: Why AI Will Make You Poorer While Your Landlord Gets Richer
The gap between rich and poor is widening despite two centuries of innovation. There’s a reason—and it’s not what you think.
Two hundred years ago, the gap in life expectancy between rich and poor areas in Britain was ten years. Today, after the Industrial Revolution, the invention of antibiotics, the digital revolution, and countless medical breakthroughs, that gap has widened.
Let that sink in. We’ve split the atom, mapped the human genome, and put computers in everyone’s pockets. Yet the person born in Glasgow today can expect to die years earlier than someone born in a wealthy London borough—and the difference is greater than it was in 1825.
This isn’t an accident. It’s not a policy failure or a temporary setback. According to Fred Harrison, one of Britain’s most persistent economic investigators, it’s the predictable result of what he calls “the ultimate crime”—the systematic theft of community-created wealth through economic rent.
From True Crime to Economic Crime
Harrison’s journey to this conclusion is as unconventional as his diagnosis is radical. In the 1960s, he was an investigative journalist who spent 18 hours in a prison cell interviewing Ian Brady, one of Britain’s most notorious serial killers. His investigation led to the discovery of additional victims in the Moors murders case, bringing closure to grieving families.
But after that success, Harrison pivoted. He left journalism to embark on what he calls “the Rent project”—investigating an economic crime he came to see as far more devastating than any individual murder. “People dying prematurely,” he says simply, “and it’s getting worse.”
The crime he’s talking about isn’t hidden in dark alleys. It happens in broad daylight, sanctioned by law, embedded in the very structure of our economy. It’s the private appropriation of economic rent—the value created not by individual effort or investment, but by the community itself.
What is Economic Rent?
Economic rent is the portion of income derived from ownership of natural resources and locations, rather than from labour or capital investment. When a property in central London is worth millions more than an identical building in a remote village, that difference isn’t because of the building itself. It’s because of everything the community has built around it: the transport networks, the schools, the hospitals, the businesses, the cultural institutions, the concentrated economic activity.
That location value—that economic rent—is created by everyone together. Yet under our current system, it’s captured almost entirely by whoever happens to hold the title deed.
This matters because economic rent represents a massive chunk of national wealth. And unlike the returns to labour (wages) or capital (interest and profits from productive investment), economic rent isn’t earned. It’s appropriate. You can work harder and earn higher wages. You can invest wisely and earn higher returns. But if you own land in the right location, you get rich simply by waiting while the community makes your asset more valuable.
The Paradox of Progress
Here’s where Harrison’s diagnosis becomes truly disturbing. Every technological innovation, every infrastructure improvement, every increase in productivity should benefit everyone. When we build better transport systems, discover new medicines, or create more efficient ways to produce goods, we’re expanding the pie.
But we’re not redistributing the pie. Instead, much of that value gets captured through land prices and location rents.
Consider a simple example: A city builds a new subway line. Property values along the route skyrocket. The landowners become dramatically wealthier overnight—not because they did anything, but because the community built infrastructure that made their locations more valuable. Meanwhile, businesses and residents face higher rents. Workers need higher wages to afford housing, making businesses less competitive. Young people struggle to buy homes. Entrepreneurs face steeper barriers to entry.
The same pattern repeats with every improvement. Better schools? Higher property values in the catchment area. New hospital? Nearby land becomes more expensive. Growing economy? Rents rise faster than incomes.
This is why, as Harrison points out, 200 years of breathtaking innovation have failed to close the inequality gap. The gains from progress are systematically siphoned off through economic rent.
Technology as Accelerant
If anything, modern technology is making this problem worse, not better. As Peter Smith notes in the discussion, businesses are facing severe financial pressure. Banks prefer lending on real estate rather than productive enterprises. Why? Because real estate is backed by location rent—a claim on community-created value that’s reliably extracted regardless of whether the borrower creates anything useful.
This creates a vicious cycle:
Credit flows to rent-seeking, not value creation. Banks would rather finance property speculation than fund the startup that might develop the next breakthrough technology.
The cost of access rises. As location values climb, businesses need more capital just to access a location where they can operate. Harrison notes that interest payments on these inflated property costs “cripple your scope of freedom in the future.”
Work and real investment become less rewarding. If you earn money through labour or genuine entrepreneurship, you’re taxed heavily. If you earn money by owning land while the community makes it valuable, you pay relatively little. The system rewards rent-extraction over value creation.
Wealth concentrates. Those who already own prime locations capture an ever-larger share of economic gains, while those who don’t fall further behind.
Now layer artificial intelligence, automation, and digital platforms onto this dynamic. These technologies promise enormous productivity gains. But in our current system, who will capture those gains? If you’re a worker whose job is automated, you lose your income. If you’re an entrepreneur trying to start a business, you still need to pay extractive rents for location and assets. But if you own the real estate, the data infrastructure, the platform monopolies—the scarce assets everyone else needs access to—you get richer automatically as the economy grows around you.
The Perverted Market
Harrison doesn’t mince words: “Ours is a perverted market.” Interest payments, he notes, have a “legitimate role to play in the market economy if that market is structured correctly. But ours isn’t.”
In a properly structured economy, interest would reward those who defer consumption to invest in productive capital—factories, machines, research, genuine innovation. Profits would reward entrepreneurship and risk-taking. Wages would reward labour and skill.
But when the market is perverted by rent-seeking, these mechanisms break down. The highest returns go not to those who create value, but to those who control access to what others need. It’s not just inefficient—it’s extractive.
Think about the businesses Peter Smith mentions, struggling with cash flow as banks tighten credit. These aren’t businesses that have stopped creating value. They’re businesses that can’t compete with the rent burden. The real estate keeps extracting value regardless of whether the economy is producing anything useful.
Harrison predicts these are “symptoms of the gathering momentum” toward economic collapse. Banks prefer real estate loans because they’re backed by location rent—a claim on value the community creates—rather than the uncertain returns from genuine enterprise. So credit dries up for productive businesses just when they need it most, while flowing freely to property speculation. The collapse, when it comes, will be triggered by this misallocation.
The Widening Divide
This brings us back to the central scandal: Despite 200 years of extraordinary technological progress, the gap in life expectancy has widened. Why?
Because the fundamental mechanism of distribution is broken. When we make collective progress, the benefits get captured through rent rather than distributed to workers and genuine investors. The person who works harder doesn’t get proportionally more. The person who invests in a productive business faces higher costs and heavier taxes. But the person who owns land in the right place gets automatically wealthier as the community prospers.
Over time, this creates a self-reinforcing inequality. If you’re born wealthy enough to own significant property, each wave of progress makes you richer. If you’re not, you face rising costs to access the opportunities that community progress has created. The ladder of social mobility doesn’t just get harder to climb—each rung gets more expensive.
And because rents extract resources from productive activity, the whole economy grows more slowly than it should. We get less innovation, less dynamism, and less opportunity. The people in poor areas die younger, not just because they have less money, but because the entire society is structurally hobbled.
The Solution: Reclaim What We Create Together
Harrison’s prescription is as radical as his diagnosis: Stop taxing labour and genuine capital investment. Instead, collect economic rent—the community-created value—for community benefit.
“In the world where you don’t pay tax on your labour or your true investments,” Smith summarises, “but we do reclaim the community-created economic rent that we all create together, that would create amazing opportunities for businesses, for small businesses, for people to do amazing things that they can’t do now.”
Harrison agrees: “It’s the transformative formula and there is no other way to achieve people’s desires to fulfil their lives, to realise their aspirations, other than a full-blooded transformation.”
This isn’t a marginal adjustment. It’s a fundamental restructuring of property rights and taxation. The land value tax—or location rent collection—has been proposed by economists from Adam Smith to Milton Friedman. The logic is impeccable: Tax the things we want to discourage (pollution, extraction, waste) or the things that can’t be hidden or moved (land value). Don’t tax the things we want to encourage: work, innovation, productive investment.
Currently, we do exactly the opposite. We tax work heavily. We tax business profits. We tax capital gains from genuine entrepreneurship. But we barely tax land value—and we certainly don’t collect anywhere near the full economic rent that land generates.
The result? Work becomes less rewarding. Investment in productive activity faces barriers. But speculation in land and assets yields reliable returns. We’ve created a system that rewards extraction over creation.
No Half Measures
Harrison is emphatic: “There are no half measures to achieving our ambitions.” Tinkering won’t work. Trying to balance the equation through government spending just masks the problem temporarily. During the 2008 financial crisis, governments “poured a load of money into the market” and pushed up sovereign debts, which then required heavy taxation and austerity spending cuts—” on the needs of the lower half of income earners.”
The problem isn’t that we lack resources or technology. The problem is structural. We’ve built an economy that systematically diverts community-created value into private pockets, that rewards rent-extraction over value-creation, that makes it harder to succeed through work and easier to succeed through ownership.
You can’t fix that with monetary policy or government intervention in the credit system. As Harrison notes, sovereign money creation might “make it easier for governments to spend their way out of problems and thereby increase inflation into hyperinflation,” but it won’t address the root cause.
Technology’s Fork in the Road
We stand at a crucial juncture. The technologies we’re developing—AI, automation, biotechnology, renewable energy—have the potential to create unprecedented abundance. But in our current system, they’re more likely to create unprecedented inequality.
Why? Because these technologies don’t change the fundamental dynamic. They might even make it worse. If AI can do most jobs better than humans, but access to AI systems is controlled by those who own the scarce assets (data, platforms, infrastructure), then the gulf widens. The owners of monopoly assets extract even more rent. Everyone else has less leverage.
The choice is stark: We can continue on our current path, where each wave of technological progress enriches a smaller slice of property owners while leaving everyone else fighting over scraps. Or we can fix the structural flaw—reclaim community-created value for community benefit—and let technological progress actually improve lives across the board.
The Crime That Hides in Plain Sight
Harrison calls the private appropriation of economic rent “the ultimate crime” because it happens systematically, legally, and invisibly. Unlike the Moors murders, it doesn’t announce itself with victims and horror. It works slowly, through markets that appear neutral, through property rights that seem natural.
But the body count is real. Every person who dies early in a deprived area is, in some sense, a victim of this system. Every person trapped in precarity despite working hard. Every entrepreneur who can’t get started because the entry costs are too high. Every innovation that never happens because capital flows to speculation instead of creation.
The tragedy is that we know how to fix this. The economics have been understood for centuries. Land value taxation or economic rent collection is not a new idea—it’s been advocated by economists across the political spectrum. What’s missing is the political will to confront entrenched interests and restructure property rights.
Looking Forward
As Harrison and Smith wrap up their conversation, there’s an urgency to their words. The economic system shows signs of the “gathering momentum” toward crisis. Small businesses face crushing pressure. Credit dries up for productive enterprise while flowing freely to real estate speculation. The contradictions are building.
When the crisis comes—and Harrison is confident it will—we’ll face a choice. We can respond with more half-measures: more quantitative easing, more sovereign debt, more attempts to prop up a broken system. Or we can seize the moment for “full-blooded transformation.”
The technical path is clear: Shift taxation away from labour and capital, toward economic rent. Remove the penalties on work and investment. Reclaim the value we create together, as communities, for community benefit. Let people keep what they earn through genuine contribution. But don’t let anyone extract value simply by controlling access to what nature provided and the community improved.
The political path is harder. Property owners—especially those who own valuable locations—benefit immensely from the current system. They have every incentive to preserve it. Changing course requires enough people to understand what’s at stake and demand transformation.
That’s why Harrison and Smith have these conversations. Not because they’re easy or popular, but because “these little chats of ours actually hold within them the only way we can turn around humanity and get us on a track to creating a much better world.”
The Question We Must Answer
Technology will not save us if we don’t fix the underlying structure. More innovation, more productivity, more breakthroughs—they’ll just mean higher rents, greater inequality, wider gaps in life expectancy. The system will extract whatever gains we make.
But if we get the structure right—if we reclaim community-created value and stop penalising genuine work and investment—then technology can deliver on its promise. The abundance can be shared. The opportunities can be real. The ladder can be there for everyone to climb.
The gap in life expectancy should be closing, not widening. That it isn’t tells us everything we need to know about how broken our current system is. The question is whether we’ll fix it before the next crisis, or after.
As Harrison puts it, there are no half measures. Either we confront the structural flaw—the systematic theft of community-created wealth—or we accept that each generation will face greater inequality, less opportunity, and shorter lives than their potential allowed.
The choice, as it always has been, is ours to make.
The conversation between Fred Harrison and Peter Smith offers a radical but coherent diagnosis of our economic dysfunction. Whether you agree with their prescription or not, their central insight is difficult to dismiss: When 200 years of technological progress fails to narrow inequality gaps, something fundamental is wrong with how we distribute what we create together. Until we address that structural flaw, more innovation will just mean more extraction—and technology, instead of liberating us, will only accelerate our divide.
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