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What if the senator? Bernie Sanders is right and Federal Reserve Chairman Jerome powell is it wrong?
What if the AI revolution causes mass layoffs of American workers, as the Vermont senator warned in a recent Fox News op-ed? What if Powell is wrong to say that the weakening labor market is mainly due to supply problems (lower immigration and lower labor participation rates) rather than “efficiencies” produced by AI?
What will be the response of policy makers? What should it be?
SEN SANDERS: AI SHOULD BENEFIT EVERYONE, NOT JUST A HANDFUL OF MILLIONAIRES
AI will soon become a political battlefield. Democratic socialist Sanders, always a class warrior, has already discussed whether AI will help all Americans or just “a bunch of billionaires.” Like the trade deals that sent millions of jobs overseas, Sanders worries that the massive investment flowing into AI could cause up to 100 million Americans to lose their jobs over the next decade. He could be right — imagine the repercussions.
Young people are already losing faith in capitalism and moving towards socialism. Two-thirds of Democrats now view socialism more positively than capitalism. Nothing could undermine our capitalist system more quickly than the widespread feeling of job losses due to a technological advance applauded by the investor class.
This is the critical issue of our day: one that receives scant attention, even from the self-described “data-driven” Powell, who constantly looks backward instead of forward. At his latest press conference, Powell responded to a question about employment by saying, “The supply of workers has fallen very, very sharply due primarily to immigration, but also lower participation in the labor force. So that means there’s less need for new jobs, because there’s not… there’s not this flow into the labor pool where people need jobs.” Excuse me, what?
The economy is growing, but hiring is slowing. Although the government shutdown has blocked the usual monthly labor reports, much data suggests that the labor market is weakening. Companies are increasingly citing Investment in AI as a factor in the smaller number of people.
TRUMP’S AI PLAN IS A BLUART AGAINST THE GROWING THREAT FROM CHINA
American companies are spending tens of billions of dollars on AI, promising shareholders big productivity gains. But where will that productivity come from, apart from reducing the workforce? Certainly, people armed with artificial intelligence can deliver information and analysis more quickly, making them and their organizations more productive. But it will also ultimately make some people redundant and slow down new hires. The impact on the American labor market will be profound and is largely being ignored.
Amazon recently announced that it was laying off 14,000 employees. A senior human resources official at the firm sent a memo titled “Staying agile and continuing to strengthen our organizations.” He wrote that “the world is changing rapidly. This generation of AI is the most transformative technology we have seen since the Internet and is enabling businesses to innovate much faster than ever before.”
What type of workers are at risk? Factory workers and truck drivers, no doubt, who are already being replaced by robots and artificial intelligence, but also by white-collar employees. Fortune notes that Amazon’s layoffs “demonstrate that they will hit middle management first.” The world’s largest retailer employs around 1.5 million people; 14,000 is a drop in the bucket. But the trend is terrible and, for those 14,000 people, devastating.
Amazon is not alone. UPS recently announced that it has eliminated 48,000 jobs this year: 14,000 management positions and 34,000 in operations. UPS began the year with about 500,000 employees. Target also made headlines recently, saying it will cut 8% of its corporate workforce, its first significant layoffs in a decade.
JOBS THAT ARE MORE RISKED BY AI, ACCORDING TO MICROSOFT
Outplacement firm Challenger, Gray & Christmas cites economic and market conditions as the primary reason for most corporate layoffs to date, but also points to AI. That makes sense. After all, the economy is growing rapidly: real GDP growth in the second quarter was 3.8% and it looks like we will see solid expansion in the third quarter as well.
There has never been faster adoption of new technologies. An estimated one-third of Americans already use AI; ChatGPT receives 5.4 billion visits per month. Global AI revenue is expected to total $391 billion this year and could reach $3.5 trillion by 2033. These estimates may be optimistic, but major tech companies are investing around $400 billion this year alone to expand capacity, according to The Wall Street Journal. They clearly believe in the projections.
Bernie Sanders aside, no one should want to stop the AI revolution. Artificial intelligence promises extraordinary advances in medicine and other sciences, and could radically improve the education of American children.
It will also largely be American companies that will benefit from the explosion in AI spending, reaping the profits and influence that come with global dominance of a new technology. Increased productivity will stimulate hiring in certain industries and boost real wages. It will also allow the retirement of the more than 20 million baby boomers who still work.
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But there may well be an adjustment period in which layoffs outpace job creation. Unemployment may rise, fueling anger at innovations that produce more unemployed Americans and resentment toward the companies behind the disruptions.
Senator Bernie Sanders joined the co-hosts of “The View” to talk about his new book on Monday, October 20, 2025. (ABC/The View)
Lawmakers and financial leaders should be prepared for this possibility, which could deepen growing voter interest. affection for socialism and rejection of capitalism. That would be a disaster for a country that has surpassed every other nation on Earth, producing unprecedented opportunity and wealth.
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Otherwise, it will be Bernie Sanders and his leftist colleagues who dictate the response. Sanders advocates for a 32-hour work week with no pay loss, giving workers much more power and imposing a “robot tax” on big tech companies. Such measures would slow American competitiveness and growth, as they have in Europe.
We cannot allow that to happen.
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