Federal Reserve Chairman Kevin Warsh will convene a forum in San Francisco on Monday to examine how artificial intelligence could reshape the US economy, as concerns over jobs, inflation and inequality complicate its promise.
Fed officials expect AI to transform the economy, but its pace and consequences remain uncertain. The discussion will consider risks ranging from job losses to faster growth and lower prices.
The meeting is the only event among the five task forces Warsh established this year. It follows last week’s midterm elections, which triggered a backlash against rapid data-center construction and raised concerns about inequality.
While AI could eventually improve productivity and ease inflation, investment driving its expansion is pushing prices higher. Fed officials remain uncertain about when these pressures may ease.
Warsh initially viewed AI as a force that could lift productivity and allow lower interest rates. Since taking the Fed role in May, he has adopted a more cautious position, reflecting uncertainty over when productivity gains will arrive.
Concerns include land use, mental health, financial-market stress linked to complex AI funding, and national security.
Oakland Mayor Barbara Lee has backed a movement to restrict data-center construction. She said AI must be used responsibly and ethically, and should not deepen biases or cause discrimination or displacement.
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Fed Governor Lisa Cook has warned AI could cause a temporary increase in unemployment. Governor Michael Barr said the US should prepare for serious short-term job-market disruption, depending on deployment speed and whether AI remains affordable and accessible to businesses.
AI investment is supporting US growth, stock-market gains and consumer and business spending.
Richmond Fed President Tom Barkin called the investment historic, comparing its scale with the building of railroads and interstate highways. He warned of consequences if it fails to deliver expected returns.
The task force includes chair Marc Andreessen, Stanford economist Chad Jones, and Microsoft's Xbox chief Asha Sharma. Its recommendations will not determine Fed policy, which remains the responsibility of central bank officials. Barkin hopes Monday's discussion will include support for AI and critical views.