Barkin Says Fed Shouldn’t Counter ‘Creative Destruction’ From AI

Federal Reserve Bank of Richmond President Tom Barkin said interest-rate policy shouldn’t be used to counter the disruption that artificial intelligence may cause to businesses and the labor market.

“What you just described is creative destruction, and that’s been happening for hundreds of years in this country, and it’s part of the essence of capitalism,” Barkin said Wednesday in response to a question during an event in Northern Virginia.

The Fed’s principal tool, its benchmark federal funds rate, is a “blunt instrument,” he added.

“It’s not the answer to all these issues,” he said. “If you support capitalism, which I ...