AI NEEDS STRONG REGULATION

SUMMARY: Artificial intelligence (AI) needs strong regulation because its effects are far-reaching and powerful. U.S. Representative Khanna states that a robust federal agency is needed to regulate AI and has put forth seven principles for a new social compact to address the issues of AI and inequality.

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My previous post provided an overview of the need for strong regulation of Big Tech companies and focused on artificial intelligence (AI). It also shared an innovative proposal from U.S. Senator Sanders to regulate the AI industry through public ownership of 50% of the big AI companies. This post will go into more depth on the need to regulate AI and principles for ensuring that AI produces public benefits rather than solely private wealth.

AI needs strong regulation because its effects are far-reaching and powerful. AI is having dramatic impacts on the news we get, the entertainment we enjoy, and the social media we consume. It’s affecting our jobs, sometimes to the point of getting laid off and replaced by AI. It’s having negative effects on education and mental health. Its data centers are affecting local communities and increasing costs for electricity and water, as well as having serious negative environmental impacts. The paper-wealth AI is generating is skewing our society and politics, while also creating a financial bubble that could burst with serious negative effects on financial markets and our economy. Some of AI’s worst aspects may be in its use by the military and its ability to generate pornographic images.

A key ingredient of AI’s implementation has been the combination of huge databases (including our personal information) and massive computing power. In many cases, it isn’t the algorithms and their “intelligence” that are new, but simply AI’s use of them with huge databases and computing power. In many ways, this is a brute force approach that is reflected in the industry’s need for huge data centers using massive amounts of electrical power to operate and of water for cooling.

The result is an amazing ability to manipulate us, for example, our shopping and our addiction to social media. It also gives the AI and related companies or governments, incredible power to surveil us – to know where we are and what we’re doing. Make no mistake, we and our data are the product, and we are very much for sale.

If AI were being implemented with the best of intentions, as a beneficial innovation, the amount of misinformation would be declining and not growing; faked images, text, and speech would be detected and not disseminated; and inflammatory rhetoric and hateful content would be identified and blocked. AI certainly has the capability to do these things if they were the goals of its creators and implementers. However, the industry’s goals are clearly to maximize profits and wealth. Many experts who are deeply involved with and knowledgeable about AI are sounding warnings about possible catastrophic results. [1]

To counter the growing public unease with AI, the AI companies and their incredibly wealthy founders and investors are spending tens and sometimes hundreds of millions of dollars on election campaigns and lobbying. As a result, there often is support for the industry among policymakers. The Trump regime is promoting the U.S.’s AI world leadership as a national security priority. Trump issued an executive order directing his Attorney General to sue states that try to regulate AI. His key policy makers for AI have substantial conflicts of interest through investments in AI companies. [2] There have been significant government investments in AI for its initial development and its deployment. There are government subsidies at the federal, state, and local levels for the construction of AI’s data centers, for the chips needed for AI computing, and even for the exports of AI companies. There’s a $1 billion federal government loan for the restarting of the Three Mile Island nuclear power plant to provide electricity for a data center. This is oligarchic crony capitalism at work.

U.S. Representative Ro Khanna (D-CA) states that a robust federal agency is needed to regulate AI and has put forth seven principles for a new social compact to address the issues of AI and inequality, which AI will exacerbate if not well regulated. Here are his principles: [3]

Ensure AI augments human capabilities and doesn’t just eliminate jobs.
Require that workers benefit from AI-driven productivity gains through higher wages, profit sharing, and a shorter work week. Americans should also get paid for the data they generate that AI uses.
Fix our tax system that currently subsidizes robots with accelerated depreciation and disadvantages human workers via payroll taxes.
Provide AI-displaced workers jobs in public service, as FDR did during the Great Depression.
Require data centers to serve the communities that host them, from supporting schools and libraries, to supporting local businesses, to avoiding increases in electricity and water costs, as well as negative environmental impacts.
Require social media platforms to stop AI algorithms from spreading hate and other harmful content. Require them to support interoperability so users are not trapped by monopolistic control but can switch and connect across platforms.
Regulate AI with a robust federal agency so it’s used to enhance humanity and not harm it.

For lots of good news see Jess Craven’s Chop Wood Carry Water blog’s most recent good news Sunday post here.

[1] Khanna, R., 4/8/26, “AI for the people,” The Nation (https://www.thenation.com/article/society/ro-khanna-ai-democracy-blueprint/)

[2] Glickman, S., Kak, A., & Myers West, S., 4/8/26, “The great AI grift,” The Nation (https://www.thenation.com/article/economy/ai-crony-capitalism-grift/)

[3] Khanna, R., 4/8/26, see above

BIG TECH NEEDS STRONG REGULATION

SUMMARY: The Big Tech companies need strong regulation because of their potential for great benefits but also great harm. This is especially true for the artificial intelligence (AI) industry. An innovative approach to regulation of AI is to have the federal government seize 50% of AI companies’ stock with the shares put in a sovereign wealth fund to benefit all Americans.

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

(Note: Please follow me and get notices of my blog posts on Bluesky at: @jalippitt.bsky.social. Thanks!)

The Big Tech companies need strong regulation. There are various definitions of Big Tech, but I include all the technology companies that have a significant influence on people’s daily lives – on the information they get, the ads they see, the virtual interactions they have, the online shopping they do, and the entertainment they enjoy. This includes the big social media platforms, online services providers (including app stores and search engines), and artificial intelligence (AI) companies. All of them have a degree of monopolistic control in their markets through a combination of high market share and features that make it difficult for their customers to switch to a different company.

This post focuses on the big AI companies, which are:

Meta: owner of Llama AI (as well as Facebook, Instagram, and WhatsApp)
Alphabet: owner of Gemini AI (as well as YouTube and Google)
Microsoft: owner of Copilot AI (as well as LinkedIn and a dominant seller of computer software and services)
OpenAI owner of ChatGPT (OpenAI is 27% owned by Microsoft)
Anthropic AI owner of Claude
xAI owner of Grok (xAI is part of SpaceX, owned by Elon Musk along with X, formerly Twitter)

AI presents the possibility of great benefits to society but also the potential for great harm. It has also made a small number of individuals and their companies extremely wealthy. Previous posts (here and here) have discussed how such highly concentrated wealth is a threat to democracy, if not actually incompatible with it.

Strong federal regulation of AI is essential because AI presents serious threats to individuals’ well-being, national security, and jobs. It is changing how people get, process, and use information and misinformation. Its use in military applications is dangerous and potentially catastrophic. The bubble that AI is creating in our financial markets could well lead to a major economic crash if it bursts in dramatic fashion. AI’s chatbots are harming children and adults. Education is being transformed at all levels. Making sure AI-related changes are beneficial for students presents challenges. AI-generated sex abuse and pornographic images may well be the worst of what AI has delivered to-date. [1]

AI’s intelligence is built on the accumulation of human knowledge, products, and experiences, including publications, music, and art that is fed to it to train it. Typically, the authors and creators of this material have not been asked for permission to use their products nor were they compensated. And they are typically not compensated nor even acknowledged when AI shares the information and art they have produced through hard work, time, effort, and cost. This is plagiarism.

Regulation should require that creators of material used to train and inform AI, and then shared by it, should be compensated both when their material is fed in and when it is shared as part of outputs. Furthermore, creators should be acknowledged when their material is shared, just as sources must be cited in academic publications, books’ footnotes, adaptations of music, use of people’s voices, publications of photographs, and other situations.

Regulations should ban and establish liability for spreading misinformation, harmful content, and altered or faked images, speech, or writing. Regulations should require companies to disclose data about their AI models: how they are trained, how they are tested, how they are used, and the effects they have, such as discriminatory hiring decisions and harms to mental health.

Regulation has been slow in coming especially given the exploding reach and impact of AI. Although strong national regulations and standards are needed – and would make sense in creating one set of regulations and standards for companies to comply with – Congress is largely gridlocked and the Trump regime is sympathetic to and supportive of the AI oligarchs and their companies. [2]

Some states have and are attempting to regulate AI. However, it is a new and multi-headed monster that moves and shape-shifts quickly, making it hard to regulate effectively. Therefore, these states’ efforts are sorely needed and should be encouraged and supported. Given the federal government’s gridlock, the last thing Congress should do is preempt state regulation, as current federal legislation proposes. The federal government should set a minimum floor for regulations and standards, and welcome states raising the bar higher to protect their residents. [3]

An innovative approach to federal regulation of AI is being proposed by Senator Sanders (I-VT): have the federal government seize 50% of AI companies’ stock. This would give the federal government power through its ownership share and resultant representation on the companies’ Boards of Directors. The government could block decisions and practices that harm Americans and America, while pushing for actions that would be beneficial. This would give the public, through our government, a say in determining the development and use of AI in the future.

The government’s shares of the AI companies would be put in a sovereign wealth fund that would benefit the American people. Alaska created such a fund from its oil extraction revenue that pays an annual dividend to all Alaskans. Norway created a similar fund from oil drilling off its coast. Middle Eastern countries have sovereign wealth funds based on their fossil fuel wealth. [4]

As Senator Sanders points out, AI tools were built using the collective knowledge and products of human intelligence, therefore, their use should benefit all of humanity. He notes that the idea of public ownership of AI is not his original idea. It has been proposed by independent scholars and even some in the AI industry. Sam Altman, CEO of OpenAI, has spoken in support of a public wealth fund based on ownership in AI companies to give the public a stake in AI-driven economic growth. Anthropic’s CEO Amodei similarly proposed a sovereign wealth fund with investments in AI companies. Sanders proposes that the proceeds from the wealth fund could provide direct payments to the American people (as Alaska’s does) and could support the federal government’s safety net, providing a decent and dignified standard of living for everyone. [5]

For lots of good news see Jess Craven’s Chop Wood Carry Water blog’s most recent good news Sunday post here.

[1] Trahan, L., 6/12/26, “Why Congress must lead on AI standards,” The Boston Globe

[2] Levy, M., 6/15/26, “Trump tried to block AI rules; states forge ahead,” The Boston Globe from the Associated Press

[3] Carson, B., 6/12/26, “Congress shouldn’t freeze state AI safeguards.” The Boston Globe

[4] Fayyad, A., 6/14/26, “Should the government own AI companies?” The Boston Globe

[5] Sanders, B., 6/1/26, “The public should own half of the big A.I. companies,” (https://www.sanders.senate.gov/op-eds/the-public-should-own-half-of-the-big-a-i-companies/ ) an Op Ed in the New York Times

WHAT EVERYDAY AMERICANS WANT FROM GOVERNMENT Part 2

Many Americans are worried about the cost of living. Government policies can reduce or control the costs of everyday expenses. If Democrats or others want to garner support and votes, they should aggressively promote such policies. Some examples are presented below.

(Note: If you find a post too long to read, please just skim the bolded portions. Thanks for reading my blog!)

(Note: Please follow me and get notices of my blog posts on Bluesky at: @jalippitt.bsky.social. Thanks!)

Many Americans are worried about the cost of living. The affordability of the cost of living has two components: 1) the amount of money people make and the benefits they get from their employer, and 2) the costs of everyday expenses from food to housing to health care to utilities. If Democrats, or another party such as the Working Families Party, want to garner support and votes, they should focus on the affordability of day-to-day life. They need to promote a vision of and policies for a more economically secure future for working Americans. This means embracing economic populism, including reducing economic inequality. [1]

This previous post discussed the first component, workers’ compensation. This post discusses ways public policies and government action can reduce, or at least control increases in, the cost of living, i.e., inflation. Over the last 45 years, the cost of everyday necessities has increased faster than workers’ wages, including for food, housing, child care, utilities, health care, and medicine.

Here’s an overview of some government policies that would reduce or control the cost of living. [2]

Rescind Trump’s tariffs. As even President Trump is now acknowledging, his tariffs have and will drive up consumer prices. He recently rescinded some tariffs on beef, coffee, tea, fruit and fruit juice, cocoa, spices, tomatoes and other commodities. He acknowledged that his tariffs may have contributed to higher prices at the supermarket. Since the first day that Trump announced his intention to impose tariffs, every reputable economist has stated that tariffs increase prices for consumers. (Note: Tariffs can be good policies if implemented as part of well-planned, comprehensive jobs or national security policies. However, Trump’s tariffs clearly do not meet this criterion.)
Enforce antitrust laws. Forty-five years of failure by the federal government to enforce antitrust laws (except for efforts to revitalize them under President Biden) have allowed the emergence of huge companies with monopolistic powers. This has harmed everyday Americans in many ways as outlined below. If Democrats or others, such as the Working Families Party, want to attract support and voters, they should unequivocally call out these huge companies and their oligarchic executives and investors for their greed and monopolistic behavior. This does mean that Democrats will have to stop cozying up to the oligarchs to get campaign donations.

Stop price gouging. Monopolistic or near monopolistic size allows companies to raise prices on consumers who have few if any options. In the short term, governments should implement windfall profits taxes and/or price controls to stop price gouging. In the longer term, governments should enforce antitrust laws and break up or impose very large fines on companies that engage in price gouging and other unfair, monopolistic business practices. This applies to a wide range of consumer goods and services from food to rent to air travel to health care to drug prices. It also applies to the big tech companies, Amazon, Meta (Facebook, Instagram, etc.), Alphabet (Google), Microsoft, and Apple.

Restore competition. By stopping mergers and acquisitions that lead to monopolistic power, and by breaking up monopolistic companies, competition could be restored to consumer markets. Without competition, prices go up and quality goes down, and consumers suffer.

Restoring competition would also reduce employers’ power over workers. Although this wouldn’t reduce costs, it would improve workers’ compensation and therefore the affordability of the cost of living. Employers’ power over workers has grown in multiple ways. The huge and monopolistic size of many employers limits the options for employees and, along with globalization, has allowed employers to undermine unions and cut workers’ compensation. Furthermore, many employers, including some fast-food chains, require employees to sign non-compete employment contracts that limit their ability to move to other employers for better jobs and better pay. President Biden took steps to ban non-compete agreements, but President Trump stopped this effort.

Stop privatization of public services and public goods. Privatization is often sold to the public with claims that the private sector will deliver cheaper and better services or products. This rarely turns out to be true. Once the profit incentive is introduced, prices are likely to go up and quality is likely to go down.

Nowhere is this clearer than in our health care system. The privatized system in the U.S. is the costliest system in any of the well-off countries of the world and its outcomes are among the worst. All elements of the system are putting profits before patients. Medicare is much more efficient than any of the private health insurance companies. The health care industry vehemently resisted including a public, Medicare-like option in the Affordable Care Act (ACA) because it knew the public option would deliver better care at lower prices. (See this previous post for more information on the failures of for-profit health care.)

Numerous other examples exist. Rail transportation in the rest of the world is more efficient, dependable, and convenient than the privatized system in the U.S. Internet service is cheaper and faster in Europe than in the U.S. (I’ve been criticizing privatization since way back in 2012. See this previous post and this one for more information.)

Stop the abuse of patents. Pharmaceutical companies abuse patent laws to keep cheaper generic versions of drugs from being introduced to the market. Classic cases of this are insulin and EpiPens. (See this previous post for more information.)
Enhance regulation. Regulations and enforcement of regulations need to be strengthened to protect consumers from fraud, price gouging, and unsafe food and products. Particularly where large companies have monopolistic power, strong regulation is needed. For example, millions of homeowners lost their homes in the aftermath of the 2008 financial crisis because large financial institutions were pushing fraudulent mortgages. The Consumer Financial Protection Bureau (CFPB) was created to protect consumers from financial fraud and abusive practices, such as exorbitant late and overdraft fees. The Trump administration is trying to eliminate the CFPB so big financial institutions can maximize their profits by ripping off consumers. (See this previous post for more information on the Trump administration’s weakening of regulations and the scams that are likely to be the result.)

My next post will discuss economic insecurity and inequality and the government policies that are needed to address them.

[1] Reich, R., 11/3/25, “What the Democrats must do. Now!” (https://robertreich.substack.com/p/what-the-democrats-must-do-now) /

[2] Kuttner, R., 11/12/25, “A blessing in disguise?” Today on The American Prospect (https://americanprospect.bluelena.io/index.php?action=social&chash=9a32ff36c65e8ba30915a21b7bd76506.3779&s=6009966078bda0f5 056f960a346ead8a