AI Pause Could Shield Dominant Firms, Warns Libertarian Think Tank

Lawmakers and AI executives are pushing for restraints on artificial intelligence development, but a government-mandated pause could shield dominant companies from competition and delay beneficial technology, warns the libertarian Cato Institute.

Jennifer Huddleston, a technology policy scholar at the think tank, argues that companies can address specific dangers through voluntary safeguards and shared standards without halting development across the industry. She claims that government rules are slow to write and slower to change, and that a regulatory framework built for today's models may actively hinder tomorrow's.

Huddleston acknowledges AI's risks but warns that rules shaped around leading developers could help them consolidate power and limit competition, a form of market capture that would make it harder for smaller companies to compete. She also argues that pausing U.S. development could weaken cybersecurity defenses while foreign rivals continue advancing.

Sen. Bernie Sanders and Rep. Greg Casar have proposed a pause in advanced AI development until federal safety standards are established, and OpenAI CEO Sam Altman has backed slower development and urged companies to strengthen safeguards without waiting for federal rules. Block's chairman and co-founder, Jack Dorsey, voiced similar concerns about competition, saying that rules built around leading developers could make them the only ones able to participate.

Dorsey favors open releases that researchers can inspect, modify, and test, with evaluations and known limitations published so outsiders can challenge developers' safety claims. He supports independent testing and publicly accountable enforcement, including withholding models when evidence shows their release would materially increase catastrophic risks.