Global Warning with Ryan McBeth
Oct 4, 2026 · 36 min · 11 segments
- On this week’s Global Warning: - - **AI could upend the tax system in rich countries.** - **Crypto could help the Chinese access American AI.** - **A Ukrainian naval drone sinks a…
Ryan McBethHost
First up, artificial intelligence could worsen the fiscal crunch felt by the world's richest countries.
A recent article in The Economist argues that the AI boom could worsen fiscal problems felt by wealthy countries which hold a lot of government debt.
The past year, American pre-tax corporation earnings have grown by $1.2 trillion, or about 30%.
Companies in the S&P 500 index are handily beating forecasts, yet Uncle Sam isn't actually seeing any benefit.
Government bean counters did expect lower receipts this year, mainly owing to recent changes that let firms write off more investments against their tax bills.
Conventional wisdom would have you believe that AI is some kind of godsend for cash-strapped, debt-burdened governments.
Economists expect AI to boost productivity growth, which should in turn create a bigger economy.
For the United States, our debt-to-GDP ratio continues to rise, but less quickly.
Even in an America where AI has turbocharged the economy, by the 2050s, the government could be much more indebted than it is today.
The biggest contributor to this is tax receipts that are lagging behind government spending, which includes trillions of dollars.
Ironically here, AI might not reduce the debt burdens in rich countries like the United States, but instead it may actually increase them.
One problem is that AI may create value in areas that the government taxes lightly while destroying value in the more heavily taxed parts.
The economy could expand rapidly while leaving the government increasingly starved of funds.
Throughout the OECD or Organization for Cooperation and Development countries, that is the richer world countries, they tend to rely on personal income taxes and Social Security contributions for their tax revenue.
In a world, in a world where AI begins to displace workers or even reduce their salaries overall while corporate profits rise, this tax mix may not help the government like the United States raise enough revenue.
The good news is that AI will likely spur about 3.3% economic growth in countries like the United States.
The bad news is that governments will find it increasingly difficult to capitalize on this growth.
Few countries with relatively high taxes on capital, including Australia, South Korea, they emerge relatively unscathed in this, but the majority of governments that rely on labor taxes could be crippled.
The U.S. takes a smaller hit, but it's still significant enough for many to rethink what happens next.
A falling tax to GDP ratio isn't necessarily a bad thing if real GDP rises by 30% and real tax revenue rises by 20%.
The government might be smaller relative to the economy, but it would still have more resources at its disposal.
First up, artificial intelligence could worsen the fiscal crunch felt by the world's richest countries.
A recent article in The Economist argues that the AI boom could worsen fiscal problems felt by wealthy countries which hold a lot of government debt.
The past year, American pre-tax corporation earnings have grown by $1.2 trillion, or about 30%.
Companies in the S&P 500 index are handily beating forecasts, yet Uncle Sam isn't actually seeing any benefit.
Government bean counters did expect lower receipts this year, mainly owing to recent changes that let firms write off more investments against their tax bills.
Conventional wisdom would have you believe that AI is some kind of godsend for cash-strapped, debt-burdened governments.
Economists expect AI to boost productivity growth, which should in turn create a bigger economy.
For the United States, our debt-to-GDP ratio continues to rise, but less quickly.
Even in an America where AI has turbocharged the economy, by the 2050s, the government could be much more indebted than it is today.
The biggest contributor to this is tax receipts that are lagging behind government spending, which includes trillions of dollars.
Ironically here, AI might not reduce the debt burdens in rich countries like the United States, but instead it may actually increase them.
One problem is that AI may create value in areas that the government taxes lightly while destroying value in the more heavily taxed parts.
The economy could expand rapidly while leaving the government increasingly starved of funds.
Throughout the OECD or Organization for Cooperation and Development countries, that is the richer world countries, they tend to rely on personal income taxes and Social Security contributions for their tax revenue.
In a world, in a world where AI begins to displace workers or even reduce their salaries overall while corporate profits rise, this tax mix may not help the government like the United States raise enough revenue.
The good news is that AI will likely spur about 3.3% economic growth in countries like the United States.
The bad news is that governments will find it increasingly difficult to capitalize on this growth.
Few countries with relatively high taxes on capital, including Australia, South Korea, they emerge relatively unscathed in this, but the majority of governments that rely on labor taxes could be crippled.
The U.S. takes a smaller hit, but it's still significant enough for many to rethink what happens next.
A falling tax to GDP ratio isn't necessarily a bad thing if real GDP rises by 30% and real tax revenue rises by 20%.
The government might be smaller relative to the economy, but it would still have more resources at its disposal.
The rest of this transcript — segmented and speaker-labeled, so you land on the exact moment something was said
Search every transcript — by keyword, by phrase, or by meaning, across every show Radar indexes
Trends — what is surging across podcasts, measured against its own baseline
Alerts — when a name you follow appears in a newly indexed episode
No account is needed to search Radar.