As a new year dawns and the country prepares to welcome a new president, the United States stands at a pivotal moment, poised to capitalize on the transformative potential of artificial intelligence. This technology presents an unparalleled opportunity to invigorate the nation’s economy, rivaling the impact of electricity itself. Over the next four years, the choices made will establish a foundation for economic success for the next quarter-century.
At Microsoft, a clear three-part vision is seen for the United States’ success. This includes: leading the world in AI technology and infrastructure, championing skilling programs to enable widespread AI adoption, and exporting American AI to allies.
Technology as a Foundation for Economic Growth
Throughout history, significant technological advancements have driven industrial revolutions, propelling economic growth. The steam engine sparked the first industrial revolution in the United Kingdom, followed by rapid advances in ironworking. The United States rose to global economic leadership during the second industrial revolution, fueled by electricity and the transformation of machine tooling.
The third industrial revolution, originating in the late 1900s, was driven by computer chips and software. Under the leadership of the United States, this era gave rise to companies like Microsoft. These eras were defined by what economists term General-Purpose Technologies (GPTs). Unlike single-purpose products, GPTs boost innovation and productivity across the economy:
- Ironworking
- Electricity
- Machine tooling
- Computer chips
- Software
are all GPTs that have had a major impact on history.
World-Leading AI Technology and Infrastructure
Artificial intelligence is poised to become a world-changing GPT, promising unprecedented innovation and productivity across every sector. America, capitalizing on its strengths and international partnerships, is well-positioned to lead this wave.
The nation’s technological prowess has come from its private sector. American companies, from dynamic start-ups to well-established enterprises, are driving the global AI race. Microsoft, through collaboration with OpenAI and rising firms like Anthropic and xAI, is a first-hand witness to the progress. A new generation of AI firms are emerging, as they capitalize on the rapid advancements of AI models and chips, from Graphics Processing Units (GPUs) to AI Accelerator Chips.
This progress is being made possible by large-scale infrastructure investments that support AI innovation and use. In FY 2025, Microsoft plans to invest approximately $80 billion to build AI-enabled datacenters to train AI models and deploy AI and cloud-based applications globally; over half of the investment will be in the United States. Success, however, depends on a broad and competitive ecosystem, including competitors, chip suppliers, applications companies, system integrators and the millions of software developers who use the products to create customized customer solutions.
The datacenters are built by construction firms, steel and other manufacturers, and advances in electricity and liquid cooling involving skilled electricians and pipefitters, including members of organized labor unions. These groups enable the technology sector to become an economic backbone for both the United States and the world.
American technological innovation has been shaped by Research and Development (R&D) since World War II. Key ingredients include: sustained support for basic research and commitment to investments in product development by companies of all sizes. Collaboration between basic public research from universities and private product development is what makes American R&D successful.
The incoming administration can strengthen these elements, building on the foundation of President Trump’s first term. In 2019, the President approved an executive order to strengthen America’s AI leadership. It rightly focused on federal investments in AI research. Five years later, President Trump and Congress should expand these efforts with more funding at the National Science Foundation and American universities.
AI Skilling
Skilling was a key part of President Trump’s 2019 AI Executive Order, prioritizing AI skills within existing federal educational grants and fellowship programs. The order also highlighted integrating AI technologies into educational curricula. This focus was prescient, as AI skilling has become crucial. AI is reshaping work and jobs, echoing lessons from previous industrial revolutions.
One of the most important elements of spreading a GPT across the economy is the skilling infrastructure. As AI disrupts the economy and displaces some jobs, AI will also create new opportunities if used well by lowering barriers to entry for many professions. The focus should be developing a national AI talent strategy to equip people to acquire the AI skills needed for advancement.
Microsoft’s work is providing a broad perspective and a firm belief that now is the time for the country to pursue a new national goal to make AI skilling accessible for all. It will require broad partnerships across geographic, economic, and political divides. Developing AI training programs for teachers, as well as the Microsoft Copilot for Career Navigators, will give communities the tools to be a part of the AI-driven economy. The National 4-H AI Skills Partnership will use Minecraft Education, while the Future Farmers of America’s FarmBeats for Students program will use AI to advance precision agriculture.
One conclusion that is obvious is that AI offers new tools to help people work, and also ways to learn almost anything. The country has the opportunity to equip all Americans with the skills needed to use AI to pursue higher-paying jobs and more successful careers.
AI Exports
A third priority for 2025 is the promotion of American AI exports. The 2019 executive order emphasized the need to open markets for American AI industries while protecting technological advantages and critical AI technologies.
Given technology market and its network effects, the race for international influence between United States and China could be won by the fastest first mover. Hence, the United States needs a smart international strategy to rapidly support American AI around the world. Huawei’s adoption of products in the telecommunications space has become an important issue. Early signs suggest that China is interested in replicating its telecommunications strategy in the AI sector, offering developing countries subsidized access to chips and promising to build local AI datacenters.
American companies currently have superior technology, from chips to AI models to software applications. American companies are building trustworthy AI, and making this technology available around the world through secure datacenters. US currently has strong international regulatory cooperation.
Causes For American Optimism
There is reason to be optimistic about the role of American AI in the next four years. The nation has a solid foundation fueled by an innovative private section that benefits the country. The strong education system can spread new AI skills, and by building a strong national AI talent strategy there is the chance for a promising future. A balanced export control policy can solidify diplomatic relations. Teamwork based on technology collaboration will build the foundation for the next generation of American prosperity.
