Meta, Amazon, Google, OpenAI, and other tech companies spent billions last year investing in AI. They\u2019re expected to spend even more, roughly $700 billion, this year on dozens of new data centers to train and run their advanced models.<\/p>\n
This spending frenzy has kept Wall Street buzzing and fueled a narrative that all this investment is helping prop up and even grow the U.S. economy.<\/p>\n
President Donald Trump has cited that argument as a reason the industry should not face state-level regulations.<\/p>\n
\u201cInvestment in AI is helping to make the U.S. Economy the \u2018HOTTEST\u2019 in the World \u2014 But overregulation by the States is threatening to undermine this Growth Engine,\u201d Trump wrote in a post<\/a> on Truth Social in November. \u201cWe MUST have one Federal Standard instead of a patchwork of 50 State Regulatory Regimes.\u201d<\/p>\n Some prominent economists have also given credibility to this story with their analysis. Jason Furman, a Harvard economics professor, said in a post<\/a> on X that investments in information processing equipment and software accounted for 92% of GDP growth in the first half of the year. Meanwhile, economists at the Federal Reserve Bank of St. Louis similarly estimated that AI-related investments made up 39% of GDP growth<\/a> in the third quarter of 2025.<\/p>\n But now some Wall Street analysts are starting to rethink this narrative.<\/p>\n \u201cIt was a very intuitive story,\u201d Joseph Briggs, a Goldman Sachs analyst, told The Washington Post<\/a> on Monday. \u201cThat maybe prevented or limited the need to actually dig deeper into what was happening.\u201d<\/p>\n Briggs\u2019 colleague, Goldman Sachs Chief Economist Jan Hatzius, said in an interview with the Atlantic Council that AI investment spending has had \u201cbasically zero<\/a>\u201d contribution to the U.S. GDP growth in 2025.<\/p>\n \u201cWe don\u2019t actually view AI investment as strongly growth positive,\u201d said Hatzius. \u201cI think there\u2019s a lot of misreporting, actually, of the impact AI investment had on U.S. GDP growth in 2025, and it\u2019s much smaller than is often perceived.\u201d<\/p>\n Hatzius said one major reason is that much of the equipment powering AI is imported. While U.S. companies are spending billions, importing chips and hardware offsets those investments in GDP calculations.<\/p>\n \u201cA lot of the AI investment that we\u2019re seeing in the U.S. adds to Taiwanese GDP, and it adds to Korean GDP but not really that much to U.S. GDP,\u201d he said.<\/p>\n On top of that, there is currently no reliable way to accurately measure how AI use among businesses and consumers contributes to economic growth.<\/p>\n So far, many business leaders say AI hasn\u2019t significantly improved productivity.<\/p>\n