White House economists have labeled a recent artificial intelligence risk report that unsettled technology stocks as "science fiction," stating it violates fundamental economic principles. On Tuesday, February 24, acting Chair of the White House Council of Economic Advisers Pierre Yared, speaking after a National Association for Business Economics (NABE) conference in Washington, described the report released by Citrini Research as "an interesting piece of science fiction."
Yared stated that the Citrini report is an interesting work of science fiction—and he enjoys science fiction. However, he believes that upon careful examination and serious consideration, it becomes apparent that the report contradicts some basic principles of economics.
Pierre Yared indicated that any innovation naturally comes with "some volatility and disruption." He said he is more focused on "research findings" rather than the "apocalyptic scenarios found in science fiction."
Citrini Research envisioned a world in 2028 where the rapid advancement of machine intelligence would significantly boost productivity but also render a large portion of human labor obsolete. This scenario could trigger unemployment, a collapse in consumer spending, and a decline in stock indices like the S&P 500.
On Monday, technology stocks were impacted by the negative report from Citrini Research, with the Nasdaq Composite Index falling over 1% at one point. The Nasdaq recovered on Tuesday, closing up 1.04%.
Pierre Yared told the NABE conference that, overall, the administration's stance on AI is "full steam ahead," and it is committed to ensuring US international leadership in this field.
Following his inauguration last year, former President Trump repealed policies set by the previous administration under President Biden that established safety and transparency requirements for AI developers. Pierre Yared stated that they certainly do not want excessive government regulation to hinder the development of this era's most incredible technology. However, they aim to ensure this development proceeds in the least disruptive manner possible.
Pierre Yared revealed that former President Trump is "fully aware of this issue," and there have been "extensive discussions" within the US government on how to ensure large-scale AI development does not "cause excessive harm to local communities." While he avoided preempting presidential announcements on specific plans, his comments indicated the administration is seriously weighing the balance between technological advancement and employment stability.
US Treasury Secretary Beth Hammack has previously emphasized that modern economic history shows increased investment often accompanies employment growth. She anticipates the wave of investment in the AI sector will yield similar results. Hammack and other senior officials have compared the current AI investment boom to the internet and personal computer revolution of the 1990s, a technological wave that supported a golden era of strong growth, low unemployment, and moderate inflation.
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