A few decades ago, humans seemingly spontaneously developed the ability to read minds. This made personal interaction difficult, as nobody could shut out anybody else's stray thoughts. As a result, the average human retreated more and more into the internet, causing its evolution into a vast 'virtual reality' type of cyberscape.
With people spending more and more of their free time in cyberspace, business and commerce followed, and gradually much of the populace found themselves working and shopping in this 'virtual world'.

A majority of the workforce now 'goes to work' in virtual offices, where they interact with the computer-generated representations of their co-workers, while their bodies are actually in a bathroom-sized area in the home, rigged with goggles, sensors and the other necessary equipment to interface with this virtual world. This vast 'middle class', consisting of most of the population, spends all of their time in the virtual world. Work, school, shopping, leisure...all take place in cyberspace.

Abandoned, the outside world began to crumble and fall into disrepair. It's now populated almost exclusively by practitioners of the last remaining vocations which are still exclusive to the physical world: maintenance, shipping, food services, and the like. This small percentage of the populace spend almost no time in the virtual world, and as a result have a completely separate culture.

There is also an über-class, represented by a tiny percentage of the population and their attendants. The super-rich, their way of life is built on material possession, therefore they thrive in the material world. They shun the immaterial world of virtual reality, live on massive estates, gather in baroque ballrooms, and live extravagant, flashy lives.

2:THE ARTIFICIAL INTELLIGENCE

As the internet evolved into virtual reality, and computer science blossomed, the government began relying more and more on the decision-making ability of their proprietary supercomputer. At first, it was a reference they used to bolster their decisions. As computer technology shot forward to keep up with the demands of maintaining the virtual world, layers upon layers of programming eventually led to a state of artificial intelligence in the supercomputer. The smarter it got, the more responsibility it was entrusted with. As of the present, the artificial intelligence pulls most of the strings, unbeknownst to the populace at large, who still think of the supercomputer as a useful tool.