> Why is this time different?

That depends if AI gets to the point where it can fully replace workers, as opposed to just augmenting them. I heard Alex Imas on a podcast recently talking about how a SWE can be running 10 agents to be 10x as productive, then that SWE is more valuable so firms should want to hire more SWEs and pay them more.

That works for a while, but what if AI gets to the point where it can manage the 10 agents as well as the SWE? Of course you could say the SWE can now manage 10 agents who each manage 10 agents so he's even more valuable, but that has to break down eventually. You don't need 1,000 SWEs each managing 10,000 agents - you hit a bottleneck in the ability to give them work fast enough (even if you need the SWE at the top at all).

I think it's easier to think of from the perspective of blue collar labor. It's further out there time-wise, but let's assume we get a humanoid robot that can do any labor a human can do. It costs $25,000 and maybe a couple grand a year to operate. Works 20 hours a day when it's not charging.

The construction worker it replaces isn't going to start managing a team of robots construction robots - there's already a GC doing that, and you can't scale building nearly the way you can scale writing code because of physical constraints. When the robot I've described exists, a huge swathe of the population is going to be unemployed. There's no competitor to hire them because the competitors just get robots too.