Posted on 08/04/2026 11:26:29 AM PDT by E. Pluribus Unum
AI has rapidly become a huge economic factor while affecting everything from capital investment to how much you pay for an iPhone
The U.S. economy keeps putting more eggs in the artificial-intelligence basket.
Tech companies are spending hundreds of billions of dollars to meet AI computing needs and issuing billions of dollars of debt to help make those purchases.
The rapid data-center build-out is powering construction spending, hiring and municipal revenues. Meanwhile, a stock-market rally fueled by the rise in shares of chip makers and other companies benefiting from the AI boom has led to a massive increase in household wealth. That is helping to bolster consumer spending.
Combined, those factors are likely responsible for roughly one-third of the nation’s recent economic growth, according to Michael Pearce, an economist at Oxford Economics.
But the strength that the economy is drawing from the AI boom is also a vulnerability: What would happen if the boom fizzled out?
“It is very much an AI-driven economy right now,” said Barclays economist Jonathan Millar. “It’s hard to imagine that we would be anywhere near as resilient without that impetus.”
Mapping out exactly how much strength the economy is drawing from AI is less than straightforward, and prone to error. Even so, it appears substantial.
Details of last week’s gross domestic product report, which measures economic growth based on what the country produces, showed that business investment in AI-related categories continues to swell. Spending on software, data-center construction and computer...
(Excerpt) Read more at wsj.com ...
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The AI Boom Is Transforming the American Economy Beyond Recognition, by Justin Lahart (Wall Street Journal, August 4, 2026).
The article argues that the U.S. economy has become heavily dependent on artificial intelligence, which is reshaping capital investment, construction, stock markets, household wealth, consumer spending, and even consumer prices (e.g., iPhones). Key pointsNOT MUCH IN MUNICIPAL REVENUES——THEY ARE GETTING SEVERE TAX ABATEMENTS.
I am glad I have about 2 years left to quit working (software for 28+ years). The AI stuff is crap and I am looking forward to the day I never touch another computer. My phone will become a house phone and not be carried.
Loudoun County, VA, one of the wealthiest counties in the US, gets about 40% of its budget from taxes on data centers.
What work is AI doing for its paying customers. Who are the paying customers?
“My phone will become a house phone and not be carried.”
Excellent advice from someone in the know. I worked in IT in the Army as one of my later assignments. It was fun, but also a major PITA. So glad I’m not doing that anymore. I can just imagine the mess AI will make for our military.
I think it is now possible to live without ever interacting with a human being in person.
“My phone will become a house phone and not be carried.”
Why?
My phone goes with me and is forever saving me time and money in addition to help keeping my wife happy.
Still have to go to DMV for certain transactions unfortunately.
“What work is AI doing for its paying customers. Who are the paying customers?”
Everywhere.
Everybody.
“Excellent advice from someone in the know. “
What is good about that advice contrary to the opinion of most of the people in the world?
“I think it is now possible to live without ever interacting with a human being in person.”
Still have to interact with the dentist.
I use my phone very little. Maybe 3-4 texts every day or so from kids. Make 2-3 outgoing calls a month but get at least 2-3 800 buy gutter type calls a day. No internet browsing or maps ever. It is a big music library (all songs on the phone) for in the gym (in airplane mode). No streaming anything, ever.
Been that way my whole life, not a phone talker. If I want to talk to someone I will do it in person.
When the AI fad goes belly-up it will take the entire economy with it.
I hear you, brother. I find the thing to be a generally baleful presence ... I'll likely put a bullet through it the day I retire.
Diana in Wisconsin wrote: “Excellent advice from someone in the know. I worked in IT in the Army as one of my later assignments. It was fun, but also a major PITA. So glad I’m not doing that anymore. I can just imagine the mess AI will make for our military.”
AI may make IT jobs more challenging but it will completely transform tactical and strategic operations. The impact on intelligence, targeting, fire direction, and command & control will payoff in lives saved and shorten the duration of conflicts.
I hope you’re right.
Resolute Conservative wrote: “I am glad I have about 2 years left to quit working (software for 28+ years). The AI stuff is crap and I am looking forward to the day I never touch another computer. My phone will become a house phone and not be carried.”
Then you will be a rarity. When I retired, I got rid of my house phone since all it is a sponge for spam callers. Having a computer means you can do so many things from home instead of travelling to the bank, the grocery store, etc.
Your phone is a tracking device, like it or not.
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