{"id":1045,"date":"2026-05-31T22:06:32","date_gmt":"2026-05-31T22:06:32","guid":{"rendered":"https:\/\/propertyrelocationusa.com\/?p=1045"},"modified":"2026-05-31T22:06:32","modified_gmt":"2026-05-31T22:06:32","slug":"economist-flags-hard-proof-of-imminent-economic-collapse-one-exacerbated-by-trump","status":"publish","type":"post","link":"https:\/\/propertyrelocationusa.com\/?p=1045","title":{"rendered":"Economist flags ‘hard proof’ of imminent economic collapse \u2013 one exacerbated by Trump"},"content":{"rendered":"
\n

Chris Blattman, a renowned economist and political scientist<\/u>, issued a dire warning Sunday over what he called \u201chard proof\u201d of an impending economic disaster, the causes of which have only been exacerbated<\/u> by the Trump administration.<\/p>\n

Read more Trump\u2019s economic director catches heat after \u2018incredible\u2019 claim on Fox News<\/a><\/p>\n

The \u201chard proof\u201d Blattman was referencing was \u201cThe AI Layoff Trap<\/u>,\u201d a study published earlier this year that warns with utmost certainty of an \u201cautomation arms race\u201d in which businesses, seeking to save labor costs, replace human workers with artificial intelligence (AI) tools in a competitive fashion, and to such a degree as to \u201cerode the very consumer demand firms depend on.\u201d<\/p>\n

Written by Brett Hemenway Falk of the University of Pennsylvania and Gerry Tsoukalas of Boston University, the study presents a detailed model of how businesses would have every incentive to replace human workers with AI as the technology improves, despite the result being a catastrophic reduction in consumer demand.<\/p>\n

\u201cLike most economic models, not a useful simplification or thought experiment, but hard proof of the future,\u201d Blattman warned Sunday in a social media post<\/u> on X.<\/p>\n

Read more Ousted Trump official blasted for promoting \u2018Hitlerian greeting\u2019 ahead of \u2018fascist summit\u2019<\/a><\/p>\n

The trap, as the study refers to the \u201cautomation arms race\u201d dynamic, has \u201cno market force\u201d that \u201ccan break\u201d it, the study found, with the only solution, Falk and Tsoukalas conclude, being regulatory intervention. However, the Trump administration has moved in the opposite direction, and instead has sought to deregulate the AI industry, and has gone as far as to block states<\/u> from creating their own laws to regulate the technology.<\/p>\n

\u201cIn a competitive task-based model, demand externalities trap rational firms in an automation arms race, displacing workers well beyond what is collectively optimal,\u201d the study reads. <\/p>\n

\u201cThe resulting loss harms both workers and firm owners. More competition and \u2018better\u2019 AI amplify the excess; wage adjustments and free entry cannot eliminate it. Neither can capital income taxes, worker equity participation, universal basic income, upskilling, or Coasian bargaining<\/u>. Only a Pigouvian automation tax<\/u> can.\u201d<\/p>\n

Read more Nobel laureate issues startling warning as Trump\u2019s mental decline \u2018goes over the edge\u2019<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Chris Blattman, a renowned economist and political scientist, issued a dire warning Sunday over what he called \u201chard proof\u201d of an impending economic disaster, the causes of which have only been exacerbated by the Trump administration.The \u201chard proof\u201d Blattman was referencing was \u201cThe AI Layoff Trap,…<\/p>\n","protected":false},"author":1,"featured_media":1044,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[],"class_list":["post-1045","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"yoast_head":"\nEconomist flags 'hard proof' of imminent economic collapse \u2013 one exacerbated by Trump - Property Relocation USA<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/propertyrelocationusa.com\/?p=1045\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Economist flags 'hard proof' of imminent economic collapse \u2013 one exacerbated by Trump - 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