The Week in Breakingviews: The AI backlash arrives

Ferrari NV

30/05/2026 16:28

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.
By Peter Thal Larsen

    LONDON, May 31 (Reuters Breakingviews) - Welcome back! The war with Iran has been going on for three months. Could it be nearly over? We’re sceptical, but tell me if we’re missing something. If this newsletter was forwarded to you, sign up here to get it in your inbox every weekend.
OPENING LINE
“In the notoriously difficult video game Elden Ring, a player can die as many times as necessary to learn ​how to make progress. But Takeshi Natsuno, CEO of the franchise’s owner, Kadokawa, might be on ‌his last virtual life.”
Read more: Elden Ring owner’s extra lives are running out.
FIVE THINGS I LEARNED FROM BREAKINGVIEWS THIS WEEK
Activist investors initiated more campaigns against Japanese companies last year than in all of Europe. (A breakup boom beckons)

        Glencore GLEN.L shares have outpaced Rio Tinto’s RIO.AX since merger talks collapsed in February. (Time to try again?)
      

        The number of South Korean retail investors equates to more than a quarter of the population. (Betting on two stocks)
      

        Trips by U.S. citizens to Europe are up 20% since 2019. (Airlines are happy)
      

        Online critics are comparing Ferrari’s €550,000 Luce electric car to the mass-market Nissan Leaf. (Investors are overreacting)
      
PAPAL STRESSING
It sounds like the start of a bad joke. What do Pope Leo XIV, Standard Chartered STAN.L employees, and the graduating class of the University of Arizona have in common? The punchline hardly merits a chuckle: they have all expressed concerns about artificial intelligence.
The students booed Eric Schmidt earlier this month when the former Google boss told them the technology would touch “every relationship you have”. StanChart workers, meanwhile, objected to CEO Bill Winters describing those who choose not to upgrade their skills as “lower value, human capital” destined to be replaced by machines.
But it was Pope Leo who offered the most comprehensive and thoughtful warning about the limits of AI. In his debut encyclical, a nearly 43,000-word document titled “Magnifica Humanitas”, the first U.S.-born pontiff emphasised the case for “accepting the limits and weakness of humanity”. He advocated a “measured and vigilant” approach to the use of large language models and challenged the notion, beloved in Silicon Valley, that digital technology can “translate everything, including the mystery of the person, into data and performance.”
It’s tempting to dismiss the views of a 70-year-old former missionary who leads an institution diminished by scandals and shrinking congregations. As Pierre Briançon points out, Pope Leo may lack the clout of his predecessor, Paul VI, whose 1967 encyclical drew attention to global poverty and influenced social policies across the developed world. The positions of the Catholic Church on contraception, abortion and divorce have long been at odds with mainstream Western opinion.
Yet the pope’s AI scepticism has broader appeal. Citizens are objecting to the construction of data centres that may push up electricity prices. Military strategists debate the merits of automating battlefield decisions. Parents worry about their children growing attached to chatbots. Politicians are braced for a deluge of AI-generated misinformation. Harvard University’s graduating class delighted in comedian Ronny Chieng’s alternative commencement speech message: “I’m here to tell you the mission of your generation is to destroy AI, kill it.”
The history of economic development is of new technologies challenging, and eventually overcoming, groups who are threatened by the progress they represent. However, rapid change also has a tendency to spawn powerful reactions. As trillion-dollar startups like OpenAI and Anthropic race towards the public markets, they confront an emerging coalition of people concerned about the effects of AI on jobs, education, access to resources, and extreme wealth inequality. If that alliance develops into a political force, it could end the AI gold rush. And Pope Leo’s words will have helped light the spark.
CHART OF THE WEEK
Investment bankers and private equity executives often head to the Middle East seeking cash to fund deals. Not for much longer. The Iran war has choked off Gulf states’ oil wealth, while cranking up the need for spending on reconstruction and extra defence at home. Since 2019, the likes of Saudi Arabia, the United Arab Emirates and Qatar have had roughly $150 billion a year to deploy overseas. Now, George Hay argues, the “Gulf put” is on hold.
THE WEEK IN PODCASTS
The main event in corporate finance right now is undoubtedly the upcoming stock market debut of SpaceX. Elon Musk’s rockets-to-chatbots venture is barrelling towards an initial public offering at a targeted $1.75 trillion valuation. This raises multiple questions: how to explain that figure? (Check out our calculator.) And what about the extreme exemptions Musk is seeking from corporate governance norms? (See Giving up on governance.) Rob Cyran joined Aimee Donnellan and Jonathan Guilford in the Viewsroom to unpack it all.
David Gross, managing partner of Bain Capital, was our guest on The Big View this week. He told Jonathan Guilford about what the private equity (or captive capital) industry got right and wrong, and where it might go next around the world.
PARTING SHOT
What are they putting in the tea and biscuits in BP’s BP.L boardroom? The £80 billion British oil giant has a history of upheaval in the executive suite: four of its last six CEOs left the position abruptly. This week, turmoil reached the chairman’s office as Albert Manifold departed after less than eight months in the role following accusations of aggressive behaviour, which he denies. The drama means a governance discount will weigh on BP shares, argues Yawen Chen. Meanwhile, Neil Unmack imagines a headhunter listing the improbable combination of skills the board’s next presiding officer will require.
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Gulf states have generated a combined current account surplus worth $150 bln a year https://www.reuters.com/graphics/BRV-BRV/byprnykjdpe/chart.png
(Editing by Jeffrey Goldfarb; Production by Oliver Taslic)
((For previous columns by the author, Reuters customers can click on LARSEN/peter.thal.larsen@thomsonreuters.com))