What’s the best way to regulate artificial intelligence companies? The surprising answer comes from Franklin D. Roosevelt. The 32nd president famously declared that “the only thing we have to fear is fear itself,” and in the critical field of financial markets, he rejected calls for a fear-driven federal takeover. Instead, he worked with Congress to create a novel mechanism for market participants to police themselves—without stifling the competition that best serves consumers and economic progress. A similar approach is needed with AI.
FDR was no free-market conservative, but neither did he give in to the statist demands coming from both sides of the aisle. Amid the suffering of the Great Depression, Wisconsin Republican Senator Robert M. La Follette Jr. and Colorado Democratic Senator Edward Costigan urged the Roosevelt administration to essentially nationalize the banking system. As the populist argument of the day went, industry leaders had proven reckless, justifying much greater federal control. La Follette and Costigan made this pitch to Roosevelt the night before Congress convened in special session, just days after the inaugural address in which he warned Americans not to be afraid.
