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I think you are confusing the tiny amount of people who are actually investors or stand to directly benefit from these companies with the overall population - the overall population being generally against AI at this point.

'We must protect VC profits at the cost of the rest of the economy and our entire 'free market' system' probably doesn't sound as good.

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No I’m not confusing them. I am very aware it’s mainly policy for a minority of people. But this minority drives the markets.

This administration has done a lot for that minority already so I don’t think anyone would be too surprised? In this case they can even claim to protect the greater economy, a crash of which does impact the majority.

„US good, China bad“ has been a long term talking point by Trump too and this would neatly fit into that to be consumed by his base

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Nobody would be surprised, and something like that is what's bound to happen to some extent. But I think the current tech/VC cronyism and corruption is becoming more and more evident to the masses, and opposition is growing. There's also the economic factor of US tech being dominant in the world, if US decides to ban better tech because it is too competitive, then US companies cannot really compete globally anymore - they can't outwardly signal that they are being outcompeted.
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