Pope's AI encyclical challenges market-driven technology policy

Pope Leo XIV has issued his first encyclical on artificial intelligence, and the document marks a significant intervention in the European policy debate over technology's role in society. According to Project Syndicate, the encyclical, titled Magnifica Humanitas, explicitly rejects the premise that markets and profit incentives should be trusted to guide AI's development and deployment. The Pope invokes the biblical Tower of Babel to frame the risk: that humanity's technological ambition, unchecked by moral reflection, could collapse into fragmentation and harm.

The encyclical's framing carries particular weight in Italy and across Europe, where policymakers have struggled to balance innovation with regulation. Project Syndicate noted that Leo XIV poses a direct challenge to Chicago School economics—the market-fundamentalist framework that has dominated technology policy in the United States and, increasingly, in Europe. By arguing that AI raises questions that prices and profits cannot answer, the Pope is asserting that technological futures must be shaped by deliberation about human dignity and flourishing, not by commercial logic alone.

The timing is significant. As Stellantis and other European manufacturers race to develop affordable electric vehicles to compete with Chinese rivals, and as artificial intelligence begins to reshape manufacturing, supply chains, and labour markets, the encyclical raises fundamental questions about whose interests technology should serve. The Pope's argument—that technology must be directed toward human flourishing rather than profit maximization—stands in tension with the industrial logic that has governed European automotive strategy for decades.

The encyclical arrives at a moment when European technology policy is in flux. For years, the European Union has attempted to regulate technology through frameworks like the Digital Services Act and the AI Act, seeking to constrain the power of large technology companies while preserving innovation. But those regulatory approaches have assumed that markets, once properly constrained, can be trusted to allocate resources efficiently. Leo XIV's encyclical challenges that assumption directly.

Project Syndicate reported that the Pope's argument rests on a simple but radical premise: that AI raises questions—about human dignity, about the distribution of power, about the future of work—that cannot be answered by market mechanisms alone. A price cannot tell us whether a technology serves human flourishing. A profit margin cannot tell us whether an innovation respects human dignity. These are moral questions that require moral reasoning, not economic calculation.

The encyclical's invocation of the Tower of Babel is particularly pointed. The biblical story warns against human hubris—the belief that technology and ambition can solve all problems if pursued without restraint. The parallel to AI is clear: the technology's evangelists claim it will solve humanity's greatest challenges, from disease to poverty to climate change. But the encyclical suggests that unchecked technological ambition, driven by profit and power, may instead fragment human societies and undermine the conditions for human flourishing.

For Italy and Piedmont specifically, the encyclical's argument has industrial implications. The region's manufacturing base—automotive, aerospace, precision engineering—depends on technological innovation and capital investment. But the encyclical suggests that innovation should be evaluated not only by its profitability or its competitive advantage, but by its effects on workers, communities, and the possibility of dignified human life. That standard might lead to different choices about where to locate production, how to structure labour, and what kinds of technological change to pursue.

Project Syndicate also published a commentary by Peter Singer arguing that the encyclical, while admirably clear-eyed about the limits of techno-utopianism, remains too narrowly focused on human flourishing. Singer contends that the Pope's vision should be extended to include the interests of all sentient beings—human and nonhuman, biological or possibly artificial. That argument pushes the encyclical's logic further: if technology must be directed toward flourishing, whose flourishing counts, and on what basis do we decide?

The encyclical's reception in Europe has been mixed. Some commentators have praised Leo XIV for raising moral questions that technology policy has neglected. Others have worried that the Pope's critique of market-driven technology could be weaponized by protectionists or by governments seeking to justify industrial policy that favours national champions over competition. The tension between moral critique and political instrumentalization is real and unresolved.

For Piedmont's industrial planners, the encyclical raises uncomfortable questions about the region's technological future. The automotive sector is in the midst of a historic transition from internal-combustion to electric vehicles, and from human-driven to autonomous driving. Those transitions are being driven by market logic: companies are investing in electrification and autonomy because they believe those technologies will be profitable and competitive. But the encyclical suggests that profitability alone is not a sufficient justification for technological change.

Consider the labour implications. The shift to electric vehicles and autonomous driving will displace workers in manufacturing, maintenance, and driving. Market logic says that displacement is acceptable if the overall economy grows and new jobs are created elsewhere. But the encyclical's framework asks a different question: what does it mean for human dignity and flourishing if workers in Turin lose their jobs because a technology is profitable, even if new jobs are created in other sectors or regions? The encyclical does not answer that question, but it insists that the question must be asked and answered before the technology is deployed.

The encyclical also has implications for how Europe approaches competition with China and the United States. Both rivals are investing heavily in AI and in the technologies that AI enables. If Europe adopts a more cautious, morally reflective approach to technology—one that prioritizes human flourishing over competitive advantage—it risks falling behind in the race for technological dominance. The encyclical does not resolve that tension, but it insists that the tension be acknowledged and debated rather than ignored.

Pope Leo XIV's background as a Chicago-born pope adds another layer of significance. Chicago is the home of the Chicago School of economics, the intellectual tradition that has most consistently argued for market-driven technology policy and against regulatory constraints on innovation. By issuing an encyclical that directly challenges Chicago School thinking, the Pope is making a statement about his own intellectual formation and his break with the economic frameworks that have dominated his native country's policy.

The encyclical's influence on European policy remains to be seen. The EU has already adopted a more cautious approach to technology regulation than the United States, but that caution has been driven more by political economy—the power of European technology companies and the influence of member states—than by moral argument. The Pope's encyclical provides a moral framework for that caution, but it does not automatically translate into policy change.

For Piedmont and Italy more broadly, the encyclical's real significance may lie in its permission to ask different questions about technology and industry. For decades, Italian policymakers have accepted the logic that technology policy should be driven by competitive necessity and market forces. The encyclical suggests that there are other questions worth asking: What kind of technology serves human dignity? What kind of industrial future would allow workers and communities to flourish? What obligations do we have to the people and places affected by technological change? Those questions do not have easy answers, but the encyclical insists that they be asked.