The rapid global evolution of AI technologies, from OpenAI’s GPT-4.5 to China’s development of models such as DeepSeek and Baichuan, presents a significant challenge for U.S. AI policy. As China’s AI industry was valued at $70 billion by Chinese sources in 2023, and global private AI investment surpassed $150 billion last year, the competition is not only about technological dominance but also about securing America’s economic security and geopolitical influence. However, America’s leadership is hindered by low AI literacy and a lack of systematic mechanisms for learning from AI failures. This combination forces policymakers to respond to headlines rather than proactively shaping the future of AI.
A competitive exchange between global powers is anticipated as AI continues its transformative journey. Historical lessons from the adoption of electricity and commercial aviation can guide the effective integration of AI, helping it reach its potential in areas such as early disease detection, personalized education, and enhanced productivity.
AI will become a constant in more aspects of daily life, akin to electricity or air travel. The emerging challenges of AI, such as deepfake scams and AI-generated fraudulent impersonations, necessitate smart and practical measures to protect the public from potential harm.
Companies investing in AI face critical decisions regarding safety and governance investments. Those minimizing investments may face financial consequences if systems fail. The Trump administration’s first term showed commitment to American AI leadership through executive orders. Maintaining this leadership requires skilled workers, engaged consumers, and governance that facilitates rather than hinders progress.
With nearly three million Americans flying confidently each day, a history of commitment to safety in the aviation industry has built passenger trust. Similarly, AI, as a general-purpose technology, has the potential for dramatic growth. Economic forecasts for AI’s impact vary, with projections ranging from a 0.55% to 7% GDP increase. While the full impact remains speculative, AI’s potential is too significant to ignore, and America must lead this economic revolution.
A well-crafted governance system for AI should set industry performance expectations while ensuring public accountability. Like aviation, America needs a “flight data recorder” for AI to capture information when incidents occur, turning failures into industry-wide improvements. This practice is standard in fields involving consumer safety, such as hospitals. A balanced AI governance approach should involve AI literacy initiatives and incident reporting mechanisms to learn from AI risks and develop effective mitigation strategies.
AI literacy is essential for economic security, with AI-literate populations gaining competitive advantages. Targeted literacy programs can help Americans understand AI’s impact on daily life and prepare them to participate in the AI-powered economy. Companies with AI-literate employees will have an edge in detecting problems and implementing safeguards.
Incident reporting is crucial, with lessons learned from aviation’s culture of safety improvements. Systematic tracking of AI failures helps companies avoid costly mistakes and enhances product development. Governments must balance encouraging innovation with oversight, possibly through safe harbor provisions and tax incentives.
Implementing AI incident mechanisms requires collaboration between authorities and industry stakeholders, recognizing that safety and competitiveness are complementary goals. Companies with robust incident tracking and literacy programs will be better positioned for market leadership, where compliance requirements create operational benefits and competitive advantages.
The next four years are crucial for U.S. economic competitiveness. By focusing on literacy and incident tracking, and fostering collaboration between government and industry, AI tools can help propel American innovation and prosperity.
The opinions expressed in this article are those of the authors and do not necessarily reflect the views of Fortune. This story originally appeared on Fortune.com.
