"AI layoffs don't just cut costs: they cut workers' spending power, shrinking the market for everyone. We've got a responsibility to use AI to augment workers, not replace them."

This paper digs into a problem that's been rattling around in my head for a while.

"The AI Layoff Trap" makes a deceptively simple point: when firms cut workers to replace them with AI, they cut workers' spending power. And when every firm is under pressure to do the same, it becomes a self-defeating cycle. Everyone cuts costs because everyone is cutting costs, driving down consumer demand and putting even more pressure on margins. Guess we better cut more costs! Wait a minute...

The paper's proposed solution, a tax on automation to disincentivise this cycle, is bold. Whether it's the right answer, or can gain any political traction, I'm not sure.

Either way, we can't wait for regulation to tell us what responsible looks like. AI must empower and enhance our workforce, not destroy it.