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AI is Coming for Your Job. It’s Time for some Ground Rules

On By The Social CriticIn Economics & Globalization, Technology & ScienceLeave a comment

This year — 2025 — may go down as the year that lives in infamy. Not because the world narrowly avoided nuclear Armageddon with Iran (or Russia). But because 2025 is the year artificial intelligence (AI) came for a segment of the population that has historically benefited from innovation: the professional class.

Never mind that AI’s own developers do not really understand how it works. That it hallucinates. Or is capable of blackmail. And that reliance upon AI may dumb us down. Ready, set or not the AI arms race is here.

By some counts, AI can be expected to eliminate half of white collar jobs.

While virtually every period in history marked by innovation has been accompanied by fears of devastating job losses, with the possible exception of the mass exodus of manufacturing in the latter part of the 20th Century, worst fears have not been realized. Buggy builders became assembly line workers for the Ford Motor Company in the early days of the horseless carriage revolution. The laid-off factory worker was admonished to “learn to code”, as Hillary Clinton put it in 2016. And Silicone Valley churned out a slew of wealthy Big Tech winners, while also shunting jobs to foreign-born H1-B visa workers.

This year is different. It marks a fork in the road.

AI has come for computer coding jobs. Creative occupations, from art to music, are on the AI chopping block too. To the extent demand for high-skill foreign workers remains, much of it is justified on the basis of improving America’s AI competive advantage. By the end of President Trump’s second term, much of the job market as it exists today will have been forced to play a game of musical chairs, in which AI takes an increasing number of seats at the economic table.

Where will we be when the music stops?

This monumental transformation of the U.S. economy presents a choice: Treat the AI revolution like any other technology that has burst on the scene in the past 100+ years. Or impose limits to what percentage of the workforce in any given Fortune 500 company can be replaced.

Rather than push for unionization and protectionist measures, liberals are singing the praises of Universal Basic Income (UBI), in which idled Americans sit at home collecting a guaranteed income. Yet with $37T in debt and another $1T in interest piled on every 100 days or so, the Treasury is in no position to pay people not to work. What’s more, should AI replace high-skill jobs held by the top 10 percent of American households, it stands to reason the tax base may collapse too.

The urgency AI demands has yet to translate into the will to tackle it. Democrats and Republicans are instead caught up in a social media feud — brought to a head by Trump’s “One Big Beautiful Bill” — as to whether noncitizens should remain eligible for Medicare, SNAP (food stamps) benefits and similar. The debate is bizarre distraction from the fact that by 2035 even American-born retirees will be lucky to draw a full Social Security check. This reality was understood many years before AI endangered jobs and wages, further straining entitlement spending. Consequently, the national debt crisis does not support the notion that UBI for Americans and entitlements for noncitizens are serious, sustainable proposals.

The only way forward is for Americans to keep their jobs.

What are the obstacles to timely and decisive regulation? A public that largely views AI through the lens of entertainment and novelty. Unfamiliarity among lawmakers with a technology that still feels very much like science fiction. Republicans, for their part, loathe to regulate businesses. Progressives seemingly silent because economic crisis tied to a hasty AI integration into the economy “proves” that Democratic socialism is the only valid response to Capitalist inequalities.

The window is closing on the opportunity to tame the “Wild West” that is AI.

The only thing that will not be destroyed in a Perfect Storm of over-reliance on H-1B visa workers and AI-driven layoffs are the jobs we are so often told nobody wants: Blue Collar. Americans have left many working class jobs to the undocumented: housekeepers, farm laborers, nannies, landscapers and busboys, to name a few. Other forms of employment will be spared because there are limited funds to automate them. Specialty occupations and complex manual labor will be less impacted too.

This begs the question: Could the Trump Administration’s commitment to mass deportations may be motivated, in part, by the coming downsizing of the workforce — in the expectation there simply won’t be enough jobs to go around? Perhaps. But if the President’s only answer to the possibility of mass unemployment is to kick noncitizens out of the country, it is hardly enough.

The AI revolution is not merely about jobs lost to innovation. It is a paradoxical investment in brain drain — meaning that if humans fail to replace humans in the workforce the know-how to run businesses and government without an AI crutch will be lost. Even AI developers may find themselves boxed out. There may be little choice but to put nonhuman intelligence in charge of AI systems as more and more rungs in the career ladder collapse, blocking off a path to the top. This suggests that when the current generation of Big Tech innovators retires, there will be fewer coming up the rear. Even the proverbial geek tinkering with the next big idea in a garage is endangered.

While some have predicted that the AI boom will keep Silicone Valley relevant for years to come, the golden era of human-powered Big Tech innovation may be over.

When AI is doing the coding, who will learn to code?

When AI is doing the banking, who will learn banking?

When AI doctors outperform and undercut human physicians, who will go into medicine?

When AI is capable of designing AI, who will go into will go into AI development?

This is the “AI brain drain” precipice upon which we stand. Once a tipping point is crossed, reclaiming space for a skilled human economy beyond the narrow band of jobs that cannot be easily automated may prove more challenging than the Trump Administration’s attempt to incentivize a rebirth in American manufacturing!

The future may seem a long way off. Indeed, experts point out the AI apocalypse is not yet upon us. Before things get worse, they may even get better as humans train their nonhuman replacements:

The widespread adoption of AI technologies highlights the need for human skills to ensure the successful implementation of the tech. As a result, humans are as in-demand as ever, with AI creating new opportunities for those who embrace the change. — Sabrina Ortiz, ZDnet senior editor.

Still, the writing is on the wall. Take Microsoft. Normally, news that a Fortune 500 company intends to lay off ~9,000 workers — following a first round of layoffs in May and June that slashed ~8,000 workers — would send shock waves through the market. But not this time. Microsoft enjoyed one of its best quarters ever — $26B in profit from January through March — with stock up nearly 20 percent year-to-date. Why? Because investors anticipate that between the H-1B visa workers and AI overtaking many coding and engineering jobs, business operations will become more efficient and profitable than ever.

Addressing existential threats to the human-powered economy does not seem to interest Big Tech. AI is the shiny red ball investors are chasing. Wall Street is buoyed by the expectation that American businesses are poised to realize higher profit margins tied to the AI transition. They are betting on labor savings and productivity gains to boost the worth of their stock portfolios, with or without the drag of President Trump’s trade war.

Perhaps President Trump will conflate Wall Street’s exuberance for all things AI with proof that tariffs did not irrevocably damage the economy. Conceivably, however, unemployment will rise so dramatically that Trump’s trade war will take the blame even if the “AI Great Replacement” is, in fact, the straw that breaks the camel’s back. Whatever the case, if we are to emerge from this transition better for the effort, a commitment to regulate AI as a percentage of any given employer’s workforce and/or as a function of tax reform must come sooner than later.

For now, government seems content to go along for the ride. After all, the rise of AI is likely to prove a boon to the Trump economy. But this should not be mistaken as anything but the calm before the storm.

Calm, unfortunately, favors complacency.

One way to preserve “bandwidth” in the economy is to simultaneously address H1-B visas and AI. This could take the shape of regulating what percentage of jobs in any given industry AI can replace. It also suggests that indiscriminately slashing H-1B visas could be counterproductive, as it may motivate companies to replace still more labor with AI. At the same time, should the federal government move to regulate AI too late, it may very burst the AI bubble, not unlike the dot-com crash of the early 2000s.

All that is certain is that AI is in dire need of ground rules, otherwise efforts to deal with its disruptive impacts may amount to too little, too late.

AI, on the one hand, favors a permanent labor surplus — an employer’s market — which exerts downward pressure on wages. On the other hand, the cost of living is likely to rise thanks to pressure AI infrastructure exerts on water resources and energy markets and, in turn, the cost of goods and services. The ecological impacts of the Internet and cloud computing remain vastly underrated as a cause of rising carbon emissions some 30 years after the debut of the world wide web. AI demands even more gargantuan data centers!

What kind of quality of life will mere mortals enjoy when pressured on climate grounds to reduce living standards to accommodate the resource demands of AI? Similarly, can the United States realistically expect to come out on top of the AI arms race if the deck is tilted — as it is on many manufacturing fronts — in favor of countries who will build faster and better data centers thanks to cheaper, dirtier energy sources?

AI tax repercussions are equally sobering. In the event American jobs are lost in great numbers to AI, the national debt crisis — which is already nearing critical mass — will explode too. The top 10 percent of income earners account for 90 percent of U.S. consumer activity. Given that about 70 percent of the economy (GNP) is consumer driven, losing a significant chunk of the top 10 percent to white collar job losses would be catastrophic not only to quality of life but the tax base.

And if it looks bad now, consider that we haven’t reached so-called artificial general intelligence, the next big phase in the AI Age. At that point, AI can understand, learn, and apply knowledge across a wide range of tasks, just like a human. AGI would be capable of reasoning, problem-solving, and adapting to new situations across any domain without being reprogrammed. — Jason Nelson, reporter for Decrypt

The fact remains: Many of today’s top 10 percent — households earning $250,000 or more annually — will face AI disruption because white-collar jobs tap the very cognitive processes that AI threatens to replace. A dual-income household consisting of a tax professional and a physician’s assistant, for instance, could conceivably find that one or both are replaced. At minimum, their wages can be expected to fall over time to remain competitive with AI counterparts.

What happens when the bottom falls out from under the skilled labor market?

Given that AI does not (yet) represent a taxable unit of labor — unlike the human talent it replaces — it is a no brainer for businesses such as Microsoft and Amazon to pursue AI-driven labor savings. State and federal governments, however, have a responsibility to avert a full-blown unemployment crisis, with Social Security, Medicare and other critical areas, such as national defense, already under immense pressure caused by the national debt crisis.

The good news? The Main Street economy is not yet totally dependent on AI. It is still early enough to reimagine the AI rollout without long-term brain drain, either.

One possible solution is for the federal government to approach AI-powered Fortune 500 businesses and large regional employers in the same way the Trump Administration has attempted to re-shore manufacturing — by offering companies that hire humans a domestic tax advantage and/or those that disproportionately replace their workforce with AI with a tax penalty. (In turn, it may be necessary to impose penalties on foreign countries who dump their cheaper AI/automated products into our market, at the disadvantage of a human-powered economy.)

An even more novel solution is to make AI an avatar for its human counterparts in the labor force. In this case, proceeds from AI labor would translate to a percentage of an individual’s paycheck and one can continue to collect a stipend if and when one’s job is completely automated and replaced. (Unlike UBI, this would represent a unit of value tied to the performance of the employer in the private sector.)

The bad news? Put the AI reckoning off another three to four years and there may be no turning back. Re-humanizing the skilled labor force could be a decades-long endeavor, at a time when tax revenue losses are such that the federal government can scarcely afford to Make Work Human Again.

The private sector may seem to be the winner in all this — but this, too, is an illusion. AI efficiencies are so great that they amount to an act of self-cannibalization. To understand why efforts to minimize labor costs at all costs is a flawed approach, it is necessary to look back in time when another technological revolution was at hand: the automobile. When Henry Ford came up with the Model T in 1914, he decided to pay his workers enough to retain their services, with weekends free to own and enjoy a horseless carriage of their own. Ford invested not only in the development of a product but the creation of a market.

What AI gains in efficiency and labor savings it may lose to an equal but opposite proportion in consumers who can afford the goods and services that have largely displaced their labor.

Once every last ounce of fat is trimmed from corporate America and the consumer, alike, the self-harm will become self-evident. Better that businesses contemplate the trade-offs now than too late!

Fear that if we fail to rush off the AI precipice the U.S. will lose the AI race to China or Russia is not a policy, nor a plan. If at the same time Wall Street greed continues to put short-term gains ahead of long-term sustainability, the economic consequences will be so severe that even more pressure will mount on what remains of the labor force to automate in order to remain competitive in the race to the bottom.

Ground rules governing the how, what, when, where and why of AI are every bit as important as developing rules of the road in the days of Henry Ford. Rather than descend a slippery slope in monkey-see, monkey-do fashion, the U.S. must lead the developed world in pursuit of an AI treaty by which to standardize AI labor practices, ethics, environmental conditions and human rights. This country — and indeed the global economy — will not fare well without leadership.

Will the Trump administration have the foresight to rise to the AI challenge?

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