Chair Lee questions Comptroller on AI report scenarios and revenue impact

Okay, and then moving on to AI, I know that your office just released a report on AI and New York City's fiscal future.

The issues related to AI have multiplied over the last few years as AI's capability, sorry, has increased dramatically.

As with many new technologies, government is often years behind in learning how to deal with the new advances.

So what lessons should we have learned from the past in how we deal with AI industry?

And can you summarize your AI scenarios presented in your report and how they may affect the city's revenues?

What a good way to frame the question, Chair.

This city has been...

reshaped again and again by technology from steam to electricity to railroads to automobiles to container shipping to the internet.

Literally rebuilt the physical structure of the city.

And in some ways, sometimes we manage that well and sometimes we fail to.

We ignored the arrival of container shipping, and we no longer have major ports in the five boroughs of New York City.

We lost that to other places who adapted quicker, just to give you one example.

I think the Internet on the whole has probably made us stronger as a global financial hub and hub for knowledge work.

I think that AI is going to be by far the biggest transformation yet.

And I think we should assume it will change the city in powerful ways, change the economy in powerful ways, potentially very good, and also potentially very bad.

It's hard to exactly predict where we're headed because the experts themselves don't agree.

The technologists don't agree with the economists, and the economists don't agree with each other.

So we decide to embrace that uncertainty, and we developed a forecast that included five different scenarios.

And we ascribed a percentage likelihood to each.

They range from...

Very positive, where we could see an uptick in the market because of AI and net increase in jobs.

And they range all the way to very negative scenarios, which include potentially a rapid loss of a quarter of a million jobs in a matter of months.

We also forecast these potentially could take a hit to the budget.

For example, if the AI bubble pops, an estimate of between $9 and $14 billion, just talking about the budget hit.

So I think we need to prepare for these eventualities, both good and bad.

How do you prepare for uncertainty ahead?

How does a family prepare?

How does a small business prepare?

How does the government prepare?

We need to build up our reserves, our savings, as a family would say.

And we just have very, very little, as I outlined in our plan.

We have such a small amount relative to the scale of the budget.

And so we believe this should add to our urgency of building the reserves now, so that if we do see the bubble pop, we can avoid cutting services.

If we do see people unemployed, we can help support them.

That's what we call for in our analysis.