Within the nineteenth Century, authorities officers got here to grasp that metal could be important to each financial development and nationwide safety. Thus, they devised insurance policies that might maintain native manufacturing in addition to forestall international producers from competing in home markets.
By the Nineteen Fifties, the world had an excessive amount of metal. Producers substituted metal with professionalducts resembling plastics or aluminum. Nonetheless, policymakers in Japan, India, the US, and the EU maintained home capability as a result of metal remained important for the development trade and navy {hardware}.
Even as we speak, demand continues to shrink as governments all over the world preserve investing in metal. In 2023, the OECD predicted that overcapacity would worsen, inflicting tough market circumstances and exacerbating local weather change.
Whereas metal and AI couldn’t be extra totally different, many economists view AI as a general-purpose know-how that may stimulate each financial development and innovation. Therefore, policymakers should guarantee home capability.
Nonetheless, many authorities officers additionally already see AI as a essential know-how important to each nationwide safety and financial progress. Primarily based on a 2023 assessment of insurance policies and packages reported to the OECD, greater than 60 international locations are utilizing taxpayer {dollars} to create, disseminate, or do analysis on AI,. That’s quite a lot of AI.
Policymakers within the U.S., Saudi Arabia, Japan, Germany, the U.Ok., and the EU not too long ago introduced big public investments in AI (These investments comply with massive personal sector investments). The EU has offered $1 billion in funding annually for AI capacity-building since 2018. In March 2024, the Saudi authorities introduced it could use some $40 billion of its $900 billion sovereign wealth fund, the Public Funding Fund, to spend money on AI at residence and overseas.
On the nationwide stage, these investments are comprehensible. However collectively, they might result in overcapacity, a scenario the place the availability of AI exceeds demand.
Such overcapacity creates pitfalls along with the already well-known dangers of AI, resembling bias or inaccuracy. As nations search to maintain home AI competitiveness and market share, some would possibly dump extra capability. That might make it simpler for legal parts or rogue brokers to amass the know-how. Right here, overcapacity might result in political instability.
Furthermore, AI producers want big sums of capital to design, develop, and deploy these methods. To draw and maintain such funding, some corporations or governments could select to ignore guardrails—methods designed to restrict potential destructive results. Right here, overcapacity could also be correlated with untrustworthy or irresponsible AI.
Moreover, as they compete with different nations, policymakers could hoard information or restrict entry to applied sciences, making it more durable to cooperatively use AI to advance information or collectively tackle depraved issues resembling local weather change. Right here, overcapacity could also be correlated with a scarcity of cooperation on the makes use of of AI.
Lastly, there is a chance value to over-investment in AI. With out deliberate intent, such funding could come on the expense of different applied sciences and approaches to analyzing massive swimming pools of information.
Overcapacity is a standard downside in nationwide and worldwide economies. At instances, provide outstrips demand. However when numerous governments intervene to create and maintain capability, as they’ve achieved with metal and will now be doing with AI, we wrestle to handle the worldwide spillover results. Policymakers ought to start addressing this potential danger at present vital worldwide venues such because the G-7, the G-20, and the UN.
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