Chris Blattman, a prominent economist and political scientist, has raised alarms about an impending economic collapse, citing 'hard proof' linked to automation and the Trump administration's policies. He referenced a study titled 'The AI Layoff Trap' that outlines a troubling 'automation arms race' where businesses increasingly replace human workers with artificial intelligence (AI) to save costs. This trend, while initially beneficial for companies, threatens to erode consumer demand, which is vital for economic stability. The study, authored by Brett Hemenway Falk and Gerry Tsoukalas, argues that the only way to mitigate this crisis is through regulatory intervention. However, the Trump administration has actively pursued deregulation, even blocking states from implementing their own AI regulations. The authors contend that traditional economic solutions, including wage adjustments and universal basic income, will not suffice to address the challenges posed by automation. Instead, they advocate for a Pigouvian automation tax to counteract the harmful effects of this trend, which could displace workers and destabilize the economy.