Could the combination of Trumpism, an AI bubble and all round economic uncertainty end in diasaster for the USA...
The AI boom.... disastrous distraction?
According to Goldman Sachs, almost 30% of the S&P 500's gains in 2024 came from AI-linked firms alone. Nvidia briefly became the most valuable company on Earth
But could it be that the recent investment frenzy around AI has had the net effect of distracting America's business elite from the chaos of a second Trump presidency. With corporate valuations in steep ascent, and capital pouring into the AI firms, the donor class has little incentive for challenging incompetence or authoritarian drift, just keep pouring the money into the AI yes man's train.
This speculative boom chas maybe reated a temporary illusion: a belief that Trump's governance is functional because markets are rising. But markets rise for all sorts of reasons that have nothing to do with competent leadership.
There isn't much history to go on when considering the relationship between economic booms and political dysfunction - but the 2010s saw the social media boom - and that has certainly led to a more fractious society with people now firmly divided in their bubbles and AI still has the capability to be even more disruptive.
What Happens When the AI Bubble Bursts?
If the AI market crashes, severe recession could then hit the United States. Venture capital would evaporate; tech firms would collapse. The wealth cushioning consumers and investors would disappear almost overnight.
But the important question is this: how would a Trump White House respond to this...?
Trump has no record whatsoever of managing an economic crises, but he does have a proven track record at finding scapegoats and lashing out at others to blame for America's problems and that's probably what he'll do.... and the result won't be pretty.
I'm not sure who he'll blame, it probably won't be the Maga faithful in Silicon Valley, somehow it will be the immigrants or the poor, maybe he'll even be bold enough to racialise or sexualise his scapegoating....
Who knows, but whatever the future holds when the AI bubble bursts it ain't gonna pretty for the US!
And if the bubble doesn't burst, that's not pretty either, just maybe a little more comforting, in a SOMA sort of way!