On AI and Tech, the US Must Avoid Europe's Mistakes – Center for European Policy Analysis

Europe is gearing up to regulate artificial intelligence. The US should avoid following its lead.

As Congress debates AI regulation, there is a tendency among American activists to frame Europe as winning a race to regulate technology. Senator Amy Klobuchar claims that the European Union is “leading” in tech regulations, while regulatory advocates like Accountable Tech have called the EU an inspiration.

But Europe isn’t “ahead of us” — a quick scan of the top twenty tech companies in the world shows that none are from the EU. Instead of being a model, Europe’s tech economy is a cautionary tale of what happens when preemptive regulations take priority over nurturing domestic success stories.

Consider the EU’s AI Act. The bill that just passed by the European Parliament would impose sweeping restrictions and costly compliance mandates on even the most harmless AI applications, potentially banning innovative services. Even groups such as Human Rights Watch have critiqued the EU’s approach, warning that the AI Act would restrict positive uses of AI to protect human rights.

Much like the EU’s GDPR set the de facto global standard for privacy laws around the world, the AI Act could set an unfortunate model. And while Europe is winning the race to enact a restrictive model of AI regulation, that’s not a race the US should enter at the risk of missing out on AI’s positive impacts and driving innovators and jobs overseas.

The average American is already starting to see the benefits of AI technology in accessibility, efficiency, and reduction of human error. Just look at the way AI has helped fight costly wildfires and promote financial inclusion. By 2032, analysts predict that generative AI will become a $1.3 trillion market, one which the US has an opportunity to lead. By the end of this decade, 70 percent of businesses globally are expected to use AI, boosting global GDP by 14 percent.

Our continued investment in innovation and our specific regulatory environment is what helped us lead the world in critical tech industries like quantum computing. Those innovations have not just meant more profits — years of leading in the tech sector have created a competitive advantage that protects the US economy and strengthens our national security.

AI is the next crucial frontier. In 2018, the US National Defense Strategy identified a need for the US to prepare for AI threats to “ensure [the United States] will be able to fight and win the wars of the future.” The National Security Commission on Artificial Intelligence recently warned that the US still has work to do to prepare for AI-enabled national security threats.

Today, China and the rest of the world are close on our heels. If the US squanders its lead in the AI industry, either by emulating Europe’s forthcoming regulations or by pursuing a “pause” on AI development, it puts the security of our nation and the success of our tech economy at risk.

American policymakers need to lead — but that doesn’t mean racing the EU to enact regulations that could suffocate our burgeoning AI sector. US lawmakers shouldn’t be embarrassed that we’re “behind” in regulation — they should be proud that our regulatory environment has given birth to the world’s leading tech services, and those successes have created great jobs for millions of Americans. When it comes to AI, the US should establish its own innovation-friendly rules and responsibly nurture our AI lead.

Adam Kovacevich is the founder and CEO of the Chamber of Progress, a center-left tech industry policy coalition promoting technology’s progressive future.

Bandwidth is CEPA’s online journal dedicated to advancing transatlantic cooperation on tech policy. All opinions are those of the author and do not necessarily represent the position or views of the institutions they represent or the Center for European Policy Analysis.