A series of task forces designed to bring outside thinking to the Federal Reserve will include the “best minds,” Chairman Kevin Warsh said Thursday. For a task force that could be especially consequential for the Fed’s management of the economy — on artificial intelligence — those outside minds all seem to lean in the same direction.
Warsh’s AI task force members all appear to believe AI will be a transformative technology, with far-reaching effects on growth and productivity. That lines up with Warsh’s own views. He selected the task-force members personally.
The AI task force was one of five the Fed rolled out Thursday. Its formal charge is to “assess the economic impact of new general-purpose technologies, including artificial intelligence, to inform the Federal Reserve’s policy judgments.” It will be led by three external advisors: venture capitalist Marc Andreessen, economist Charles I. Jones, and Xbox CEO Asha Sharma.
All have recently spoken or written in sharply positive terms about the effects of AI on the economy.
The Fed chairman is a longtime proponent of the potentially transformative economic potential of AI. Its adoption is “perhaps as important a change in the economy and business and households that we’ve had in my adult lifetime,” Warsh said in June at his first press conference as chairman.
He said in 2025 that he believed advancements in AI would be a reason for the Fed to cut interest rates, because it would help the economy to grow quickly without raising inflation.
Venture capitalist Marc Andreessen speaks at the TechCrunch Disrupt conference in San Francisco, Sept. 13, 2016.
San Francisco Chronicle/hearst Newspapers Via Getty Images | Hearst Newspapers | Getty Images
Warsh has been personal friends with Andreessen for decades. Warsh also ran venture-capital investments for investor Stanley Druckenmiller after a stint at the Fed that ended in 2011. That expanded his Silicon Valley network — and his wealth.
Andreessen made a fortune creating some of the internet’s earliest web browsers and is now one of AI’s most vocal evangelists. “We’ve turned sand into thought,” Andreessen told podcaster Joe Rogan in May, referencing the silicon that is the physical basis for AI chips.
Jones, the economist, shares much of Andreessen’s West Coast optimism. Jones recently went on leave from Stanford University to join the Anthropic Institute, part of leading AI firm Anthropic. Jones’s academic work recently has focused on the effects of AI on economic growth, making him an important voice in Warsh’s efforts to bring the Fed around to his point of view.
Jones noted in a recent paper that U.S. growth per capita has consistently averaged 2% over much of U.S. history. “Nevertheless, if AI eventually automates away nearly all the weak links in the economy, economic growth could accelerate significantly, with rates potentially exceeding 5 percent per year,” he wrote.
The paper analyzes what Jones identifies as weak links — aspects of the economy that will be difficult to automate — and considers lower potential growth rates as well. But Jones writes bluntly that AI “will likely be the most transformative technology of the modern era.”
Sharma, who in February became CEO of Microsoft‘s Xbox gaming business, has made strong statements in support of AI. But as the leader of an operating business, she made the rare decision not to prioritize AI. Even as Microsoft incorporates AI into all aspects of its products, Sharma opted not to put it front and center on Xbox, she said in a recent Bloomberg interview.
“Our console players aren’t excited about that experience,” Sharma said.
But that doesn’t make her a skeptic. “Now, do I believe in AI? Absolutely,” she said.
The three task force members didn’t immediately respond to a request for comment. The Fed declined to comment.
Where Warsh may encounter skeptics is on the Federal Open Market Committee, which has the power to set interest rates. FOMC members discussed at its June meeting the question of whether AI can raise productivity, minutes from the discussion released this week show. Some FOMC participants bought into the idea that productivity would speed up, the minutes said.
And yet they weren’t fully sold. “These participants remarked, however, that considerable uncertainty remained regarding both the timing and magnitude of potential productivity gains, which were expected to lag the ongoing boost of AI adoption on demand.”
Meanwhile, U.S. tech firms’ headlong embrace of AI is starting to heat the economy. New York Fed President John Williams on Thursday said he was concerned about price increases in electricity and semiconductors from the AI boom.
Prices have risen like a “hockey stick,” with some components doubling and tripling, Williams said. AI is a “demand shock,” he said, adding that it is unclear if supply will grow alongside it, which would be necessary to keep inflation down.
The Fed meets again at the end of July, when it is expected to hold interest rates steady. The task forces are expected to finish their work by the end of the year.
