POLITICO Tech — "The next president’s AI problem"

Date: August 21, 2025
Host: Stephen Overly
Guest: Bharat Ramamurti, former Deputy Director of the National Economic Council under President Biden

Episode Overview

In this episode, host Stephen Overly sits down with Bharat Ramamurti to explore the looming impact of artificial intelligence (AI) on the American workforce and economy. The conversation delves into why AI-driven disruption is rapidly emerging as a central political and economic issue, why policymakers have been slow to respond, and what kinds of solutions could help workers weather coming changes. Ramamurti argues that AI-driven economic anxiety is likely to dominate the 2028 presidential election and outlines why both the problem and the response will differ profoundly from previous tech and trade revolutions.

Key Discussion Points & Insights

1. AI's Looming Economic Impact

• Policymakers Lagging: Despite ubiquitous conversation about AI’s benefits, there is scant serious policy work addressing its risks for workers.
  • "I was really surprised to find that no major national politician was trying to address it." (Bharat Ramamurti, [02:15])
• Acceleration and Scale of Disruption: Millions of workers could see jobs changed or lost in the next two years if AI adoption coincides with a recession.
  • "If in fact we do go into a recession... you could see a big chunk of that in the next year or two." (Ramamurti, [04:34])

2. Parsing the Data — AI's Real vs. Perceived Effects

• Attribution Dilemma: It’s difficult to disentangle AI-caused job loss from other economic trends, but public perception may outweigh nuances.
• Corporate Incentives: Firms may blame AI for layoffs to appear 'innovative' to investors, regardless of actual causes.
  • "Companies ... use that downturn as a reason to switch to automation." (Ramamurti, [04:07])
  • "A lot of people are going to be hearing AI is causing these people to lose their jobs and AI is threatening my job." (Ramamurti, [05:00])

3. Job Creation: Not All Workers Benefit Equally

• ‘Badge of Honor’ Shift: Growth used to mean hiring; now it means “scaling without hiring people” thanks to AI. (Overly, [05:21])
• Re-skilling Limitations: Economic churn is not just an abstract good—the transitions are hard, especially for older workers.
  • "You can't snap your fingers and say, I'm a 50 year old accountant...All I got to do is learn how to be an electrician in my 50s. That's not how it works." (Ramamurti, [06:18])
• Political Ramifications: AI risk is not limited to typical blue-collar jobs—white-collar work is also threatened, potentially forging new solidarities.
  • "For the first time people who work in accounting are saying, you know what, I understand what you're saying at that auto plant in Michigan..." (Ramamurti, [20:55])

4. Policy Options and Track Record

• Failings of Retrospective Relief: Historical government attempts to cushion displaced workers—like Trade Adjustment Assistance and COVID programs—are underfunded and poorly targeted.
  • "We don't fund them well enough. When we try to do the reskilling, we find that workers are often behind the curve..." (Ramamurti, [07:51])
• Empowering Workers Upfront: The U.S. lacks European-style labor engagement (works councils, high unionization), putting American workers at a disadvantage.
  • "We need to figure out a way...of creating some kind of bespoke tool that will allow workers to articulate and effectuate what they want out of this type of transition." (Ramamurti, [08:51])
• Worker Voice vs. Innovation: The U.S. focus on innovation and growth may have gone too far at labor’s expense.
  • "To me...automation has led to a declining share of national Income going to labor." (Ramamurti, [10:15])
  • "The alternative, frankly is to have more and more of the money go to capital and then try to redistribute it through tax policy." (Ramamurti, [11:12])

5. The Corporate Tax Debate

• Skepticism about AI-specific Taxes: Taxing AI outright could backfire by stifling productive tech innovation.
  • "If we think that AI adoption can be good for economic growth and productivity... we don't want to discourage that necessarily by putting a tax on it." (Ramamurti, [12:44])
• Favors Broader Corporate Taxes: Rather than evaluating complex AI taxes, raising the general corporate tax rate makes more sense—but is politically fraught.
  • "Do I think that there's room to raise the corporate tax rate back up? Sure...Even with Democrats...there's going to be some pushback." (Ramamurti, [13:37])

6. Export Tariff Controversy (Nvidia/AMD Case)

• New Trump administration policy: 15% tariff on chip sales to China.
  • Ramamurti is critical—sees it as risking U.S. economic and national security for minor revenue gains, and asserts it is likely unconstitutional.
    • "This is pretty much the stupidest way to do it." (Ramamurti, [15:03])
    • "It is literally the government taking a percentage of sales from a domestic company abroad. That seems like a tax on exports." (Ramamurti, [16:20])

7. Reflecting on the Biden Administration

• Could More Have Been Done? AI impact wasn’t yet clear enough, but efforts to raise corporate taxes and boost unionization would have helped—AI or not.
  • "A lot of the things that we tried to pursue in the Biden administration weren't AI specific, but would have been helpful in this regard." (Ramamurti, [17:30])
  • "Growth and innovation ... is more and more concentrated among those at the very top." (Ramamurti, [18:08])

8. Political Implications for 2028 and Beyond

• AI Economic Anxiety = Election Issue: Job insecurity from AI plus a possible recession create a recipe for political upheaval—potentially the central issue of 2028.
  • "Millions and millions of Americans over the next year or two are either going to see their jobs change dramatically because of AI, they're going to see their jobs disappear because of AI, or they're going to hear about other people losing their jobs because of AI." (Ramamurti, [20:19])
• Democratic Message: They must champion working Americans during this transition, learn from past mistakes (trade, automation), and articulate a clear plan to help workers benefit from AI adoption.
  • "We are going to make sure that American workers come out ahead and benefit from these types of changes." (Ramamurti, [20:05])

Notable Quotes

• “We need to have a big national conversation on this topic. And we're, I think, already behind the curve, given the pace at which AI adoption could happen.”
  — Bharat Ramamurti, [02:15]

• “You can’t snap your fingers and say, I’m a 50-year-old accountant...Now there’s all these new jobs being an electrician, building data centers. That’s not how it works.”
  — Bharat Ramamurti, [06:18]

• “Company layoffs during downturns are often blamed on automation. It’s a better story for investors—'We’re using this newfangled technology.'”
  — Bharat Ramamurti, [04:14]

• “To me, one of the key findings is that over the last 25 years, automation has led to a declining share of national income going to labor.”
  — Bharat Ramamurti, [10:15]

• “If you think it’s important to have broad AI adoption...it is important to figure out ways of making sure that working people are getting their fair share of it, because the alternative...is just outright bans on AI adoption.”
  — Bharat Ramamurti, [18:09]

• “For the first time, people who work in accounting are saying, you know what, I understand what you’re saying at that auto plant in Michigan…”
  — Bharat Ramamurti, [20:55]

Timestamps for Key Segments

• [02:15] — Why politicians are behind on the AI labor issue
• [04:07] — Why job losses during downturns are blamed on automation
• [06:18] — Problems with retraining and reskilling displaced workers
• [08:51] — How the U.S. lags Europe on worker empowerment
• [10:15] — Declining labor share of national income
• [12:44] — Skepticism about AI-specific taxes
• [15:03] — Critique of Trump administration’s chip export tariff
• [17:30] — Biden administration policy and AI’s unanticipated acceleration
• [20:05] — Political messaging for Democrats on AI disruption
• [20:55] — Possibility for new blue-collar/white-collar solidarity

Tone and Style

The conversation is urgent, pragmatic, and at times candidly critical. Ramamurti balances policy wonk rigor with accessible metaphors and practical examples, while Overly steers toward the political implications for the near future.

Memorable Moments

• American exceptionalism, rethought: The U.S. model of prioritizing innovation at the expense of labor is increasingly under strain.
• Unlikely solidarity: AI disruption could unite white- and blue-collar workers—something not seen in recent American history.
• Policy critique: Ramamurti and Overly unpack why the traditional 'money and retraining' fix fails and why U.S. politics resists both stronger unionization and corporate taxes.