Concerns around artificial intelligence (A.I.) are mounting, with moratoriums on new data center construction, fears of job losses, and increasing safety alarms. However, these worries do not negate A.I.'s potential to revitalize a slow-growing economy and address significant challenges. The need for A.I. is clear, given its ability to drive productivity and economic growth.
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Economic growth hinges on two factors: an expanding labor force and increased productivity per worker. A larger workforce can enhance the overall economy, but individual income gains depend on productivity improvements. Higher national income, particularly from productivity gains, also creates opportunities for wealth redistribution, reducing inequality and supporting public services like healthcare and education.
While workers alone often cannot boost productivity, investments in technology play a crucial role. Innovations—such as factory robots and automated checkout systems—reduce labor costs and inefficiencies. Over the centuries, periods of innovation have consistently led to significant improvements in productivity, making A.I. a key player in overcoming the current stagnation in productivity growth.
Examples of A.I.'s benefits abound. For instance, Siemens reports a 25 percent reduction in maintenance time using an A.I. co-pilot for machine repairs. Kaiser Permanente's A.I. scribe has saved physicians nearly 16,000 hours of documentation time. John Deere's A.I.-driven camera system saved 31 million gallons of herbicide mix in 2025 by targeting only identified weeds.
Historically, the economy has seen transformative productivity boosts, particularly following the Industrial Revolution and the advent of electrification in the 20th century. Despite a slowdown since the 1970s, A.I. holds promise for reversing this trend, similar to past technological innovations that initially seemed to stagnate productivity indicators.
A.I. can enhance daily life, directly impacting efficiency just as previous technologies did. However, it also raises concerns about job displacement in certain industries. Historical patterns suggest that technological advancements typically create more jobs than they eliminate and that previous labor shifts—such as those from agriculture to manufacturing—demonstrate a path forward through retraining and support.
As A.I. begins to streamline various sectors, those displaced will require policies to assist in their transition. This could involve educational subsidies for younger workers and social safety net improvements for older individuals, including wage insurance for those affected.
The need for government investment to address these shifts is crucial. Presently, A.I. benefits have largely favored investors rather than the workers directly impacted by those changes. Solutions like a “token tax” on A.I. usage and the reassessment of the generous tax breaks for A.I. companies could help ensure equitable distribution of gains.
Safety also remains a significant concern as A.I. technology develops. Robust regulation will be essential to prevent misuse, similar to how other potentially hazardous sectors, such as food and nuclear energy, are managed. Thorough testing and international cooperation are fundamental for controlling A.I.'s spread and ensuring its safe deployment.
Ultimately, managing the risks of A.I. development while leveraging its immense potential is crucial. Balancing regulation and innovation will provide the best opportunity for A.I. to benefit society, reinforcing that the pursuit of progress must occur alongside responsible development.
Steven Rattner, a contributing Opinion writer, served as a counselor to the Treasury secretary during the Obama administration. Additional research contributed by William McGrew.