Fear Is Not a Policy Framework: A Reality Check on AI

This week, we saw the latest episode of AI alarmism on full display in a Wall Street Journal opinion piece from Democratic Socialist Senator Bernie Sanders of Vermont who, along with Alexandria Ocasio-Cortez (AOC) of New York, is now demanding a “federal moratorium” on AI and the data centers that support it.

While this approach has grabbed a lot of headlines this week, it is far from sound policy and is based on fears of a hypothetical future, rather than documented facts about the impact of technological advancements throughout history.

At worst, it represents an attempt to deliberately sabotage the U.S. economy by implementing sweeping, broad-brush regulation based on speculative risks. An AI ‘moratorium’ would destroy U.S. innovation and hand a strategic advantage to global competitors like China without addressing real, identifiable harms.

To be clear, every major technological shift has followed a similar pattern: short-term disruption, followed by long-term expansion.

The spread of electricity and the modern grid eliminated entire categories of labor, but also created modern industry and led to increased employment opportunities and reduced unemployment rates. Computers replaced a great deal of clerical work but served as the foundation for our modern digital economy. The internet displaced legacy media but ultimately created trillion-dollar industry sectors.

AI is no different.

Current data already shows measurable productivity gains: developers using AI tools complete tasks significantly faster, knowledge workers producing higher quality output in less time, and health care researchers unlocking new treatments for diseases once thought to be incurable.

The claim that AI “destroys jobs” ignores the more important question: what replaces them?

The answer, consistently, is better work, more strategic decision making, and less time spent on repetitive tasks that take too much time. AI does not eliminate the contribution of workers but increases their impact and supercharges their ability to do more with less.

To be fair, there is a legitimate policy discussion around AI. Safety, transparency, and misuse matter. But broad, preemptive regulation is not precision policy. It is blunt force.

Overregulation – whether in AI, health care, manufacturing, or elsewhere – fundamentally does three things:

• First, it slows domestic innovation. Compliance costs rise. Startups disappear. Investment moves elsewhere.

• Second, it consolidates power. Large incumbents can absorb regulatory burden, but smaller competitors cannot. The result is less competition, not more safety.

• Third, it weakens U.S. strategic position. While Washington debates restrictions, China deploys, at scale, backed by the central party. The U.S. cannot be left in the dust.

That is not a hypothetical risk, it is already happening. China already has the largest grid in the world, designed to beat the U.S. in the global AI race through sheer scale despite our clear edge in quality of advanced semiconductors that enable AI.

Senator Sanders’ argument that AI presents an “imminent existential threat” is simply not grounded in current reality and is based on repeatedly disproven “doomsday” scenarios underpinned by fundamentally unscientific exaggerations.

Take, for example, Sanders’ claim that AI data centers are “diverting scarce water” in communities across the nation. Siezing on misleading headlines about data center water use, including those measuring the cost of AI queries in Olympic-sized swimming pools, completely misses the mark and ignores the science. In reality, data centers here in Texas – which is projected to soon become the largest data center market in the world – only accounted for less than 0.5% of the state’s total water use in 2025.

To increase efficiencies even further and safeguard precious water supplies, leading AI and data center companies are responding with innovation, including through recycled wastewater, closed-loop cooling systems, and hybrid air-liquid cooling designs that maximize efficiency by using less water and less power.

Like any booming industry, managing growth means managing the risks that come with it. But conflating manageable risk with catastrophic inevitability distorts policy decisions. In the meantime, leading AI developers have embedded safeguards, testing protocols, and controlled deployment environments, such as the 36-month regulatory ‘sandbox’ created through the Texas Responsible Artificial Intelligence Governance Act (TRIAGA) during the 89^th Legislative Session.

This debate is not about whether AI changes the economy. It will and already has in many ways.

The real question is whether the U.S. leads that change or reacts to it.

Arguments like those from Bernie Sanders prioritize political narrative over economic reality. They assume the worst, discount evidence, and prescribe solutions that would weaken the very system they claim to protect.

A serious approach to AI policy requires discipline. We must first recognize the scale of opportunity before addressing specific, demonstrable risks that we can manage through smart, targeted policy solutions.

Above all, what U.S. and Texas businesses need right now is clarity, not broad constraints that undermine our competitiveness on the global stage.

The ‘moratorium’ Senator Sanders and Rep. AOC demanded this week does not help American workers or communities, but instead hands the future to China, raising a bright white flag in the battle for economic dominance in the 21^st Century.

Americans, and Texans, know better than to support policies based on fear that stifle our businesses’ ability to innovate and grow. We hope our leaders in Austin and Washington alike will continue to reject such policies.

–Megan Mauro, Interim President & CEO, Texas Association of Business

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