AI’s real job threat is to Washington, not workers

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There’s no denying artificial intelligence (AI) can replace a lot—including, eventually, the very think tankers analyzing its effects as we do occasionally here at CEI. But the panic over job devastation is often misplaced. What we really need to examine, as I discussed today at Forbes, is how AI is being weaponized by Washington.

Start with the big picture. AI is rising amid an affordability crisis that disproportionally affects younger people. While predictions indicate that Gen Z will be the wealthiest ever, home ownership is out of reach for many. Corporate pensions are largely a thing of the past. Rent eats up paychecks. Meanwhile, traditional unemployment stats miss the full story—excluding discouraged workers and dropouts, but counting those who “stoop” to roles they once considered beneath them.

Add to that the tension of major tech firms laying off workers while lobbying for more H-1B visas, prompting accusations of duplicity from politicians like Ron DeSantis. Fair or not, these circumstances deepen distrust and feed a sense among some that elites are gaming the system.

For decades, the real culprits behind rising costs—housing, health care, and education—have been regulatory failures, as we have long argued at CEI. But narratives rarely start with red tape. Instead, when fears of AI threatening jobs (real or imagined) arise, they can easily become convenient excuses for more government intervention.

And Washington is already deeply embedded in AI. Along with heavy military engagement, a parade of executive orders, subsidies, R&D initiatives and public-private partnerships—under both Trump and Biden—have expanded federal entanglement in what may be the most important innovation of our time.

What’s really at stake isn’t economic adaptation, it’s political opportunism that disrupts and complicates matters. I’ve long argued that even if AI proves to be easily absorbed into the economy with minimal disruption, it’s simply too juicy a power lever for politicians to ignore.

The ultimate goal? A custodial administrative state—with Universal Basic Income (UBI) as its crown jewel. I call this development the “Plural of Apocalypse” as far as the survival of limited government is concerned. As we saw during COVID with the CARES Act and its “Economic Impact Payments,” crises become catalysts for permanent stipends. UBI is gaining traction—and not just among progressives. It is likely to seduce conservatives and some libertarians too.

That’s the true AI emergency: not that jobs disappear, but that job-loss fears get exploited to further entrench the top-down control that already holds far too much sway. As AI makes us wealthier and healthier—and reduces the need for government—Washington’s desperation to stay relevant will only grow. History shows that this kind of political predation paves the way for permanent welfare, even for the able-bodied in the form of UBI.

For further reading see my Forbes article: “What to Ponder Before AI ‘Devastates’ Jobs,” as well as the following: