OXFORD, England – In late April, a Chinese court ruled that an AI firm could not legally dismiss an employee simply because his role had been automated. Shortly thereafter, Chinese regulators reportedly suspended new autonomous-vehicle licenses nationwide in response to a mass robotaxi failure in Wuhan, a city where cab drivers had long petitioned authorities to slow the technology’s rollout. And all the while, Chinese state media has been criticizing companies for contemplating AI-driven layoffs, arguing that they have a duty to protect their employees.
Together, these episodes suggest that China is beginning to pump the brakes on its own AI rollout. But why would a state with such coercive capacity and a strong desire to dominate the technological frontier choose restraint? After all, China seemed to have a structural advantage in the AI race. An authoritarian state can be a deployment machine, overriding worker resistance, suppressing protest and keeping the gears turning, whereas liberal democracies are deliberation machines that must account for elections, unions, assembly rights and other institutional constraints.
But China has a fundamental weakness: It lacks a robust social safety net. True, the West’s high social spending — on unemployment benefits, public health care and retraining programs — is usually framed as a brake on innovation, since it requires taxing high earners and transferring wealth from productive sectors to dependent ones. But the historical record shows that social insurance can accelerate the deployment of new technologies. When a state can credibly promise that displacement will not mean destitution, workers and their representatives are more likely to accept technological change.
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