> It could be a while before the boost comes. ... There is another problem. If the productivity boost from AI is large enough to change any country’s fiscal arithmetic profoundly, vast job disruption is probably coming too, meaning more spending on unemployed workers (see United States section). Income may also shift from labour to capital, which is more lightly taxed. Should AI prompt an arms race, countries will also need more defence spending.

What a load of crap. Most of the AI investment by governments is defense spending and it's been happening for years.

This whole article's premise is trying to rearrange the reasons for the large amount of spending and muddy waters. This isn't a bet on economic growth. This is purely a capabilities arms race and the cold war never ended.

The stock market is still business as usual. This spending is all coming from taxes and private equity mostly detached from those investments. The scaremongering about employment is a red herring. We all know it doesn't work that well. It doesn't matter. The only real losers are those trying to run a business too cheaply with AI. They tend to be the same startups always expected to lose anyway.