Today, Joshua Hodges testifies before the House on steps the United States should take to retain economic leadership and protect national security in the domain of biology and biotechnology; Anne Neuberger explains how AI can help to secure vulnerable digital infrastructure nationwide; and Steven Davis speaks with the head of the International Monetary Fund about the rapidly developing field of digital finance, as well as global macroeconomic trends.
Science and Technology
Visiting Fellow Joshua Hodges testified today before the House Science, Space, and Technology Subcommittee on Investigations and Oversight. “In October 2025, Hoover released a report, Biosecurity Really: A Strategy for Victory, with the central premise that biosecurity is a solvable problem if we treat it as one. This report was released because advancing and securing biotechnology are linked together,” Hodges told lawmakers. He recounted how biodefense measures expanded significantly after 9/11, with stockpiles created to rapidly vaccinate every American against smallpox in the event of an attack. But, he warns, “the problem we face today has advanced significantly since 9/11,” given “dispersion of technology, the application of artificial intelligence, and advances across biotechnology and the life sciences.” Among other measures, Hodges calls for investment in “biological intelligence,” to be able to see in real time the emergence of “natural, accidental, or deliberate” biological threats. Read the testimony here.
Confronting and Competing with China
Much attention has been paid in recent months to the geostrategic significance of “chokepoints,” where significant dependencies and vulnerabilities can be exploited by an adversary to throttle trade, movement, or security. (The most recent issue of Hoover’s Strategika is dedicated to “Maritime Chokepoints.”) In this essay for Foreign Affairs, Distinguished Visiting Fellow Anne Neuberger expands this concept to digital chokepoints that China could exploit in critical US digital infrastructure. “Advancements in AI offer the United States and its allies their first real opportunity in many years to catch up to China on the cyber front,” Neuberger argues. She concludes, “The ultimate measure of US resilience in the face of digital Chinese chokepoints will not be the raw capability of AI models but the willingness of US institutions to use them—before an adversary causes a major disruption to American lives.” Read more here. [Subscription required.]
Answering Challenges to Advanced Economies
How can we reap the benefits of financial innovation while ensuring a sound, trustworthy financial system? For Economics, Applied, Senior Fellow and Director of Research Steven J. Davis posed the question to International Monetary Fund head Kristalina Georgieva at the Jackson Hole Economic Symposium.
The Big Idea: Their conversation touches on tokenization, stablecoins, cross-border payments, and regulatory frameworks. Georgieva describes strong institutions as the fertile ground for dynamic and stable financial innovation as well as the foundations for sound monetary and fiscal policy. The pair also discuss lessons from emerging economies and the growing fiscal challenges facing advanced economies. Georgieva argues that policymakers should address debt and deficits during good economic times rather than waiting for a crisis to force action. Watch or listen here.
“Whether we like it or not, AI is already being employed by various actors across financial markets, from banks to hedge funds and speculators,” Senior Fellow Amit Seru writes at Project Syndicate. “Increasingly, these agents will be tasked with finding new ways of making money,” he notes. “Regulators, who are in the business of stabilizing markets, will therefore have little choice but to embrace AI to circumvent the circumventers.” Seru argues that regulators have a tough balance to strike between transparency—including publishing their evaluation model criteria—and effectiveness, noting that full transparency would make it easier for banks’ AI models to “optimize around” those models that will evaluate them. He concludes that managing the limited resources of human regulators’ time and attention could, “rather than computing power . . . be the scarcest resource in efforts to ensure financial stability.” Read more here.
For the latest Grumpy Economist Weekly Rant, Senior Fellow John H. Cochrane examines three trending economic stories: a multistate challenge to the Paramount–Warner Bros. media merger deal; a $1.4 trillion lawsuit against social media giant Meta; and a proposed pipeline from Texas to California to transport gas. Across each of these stories, Cochrane argues that current policy reflects political bargaining, litigation incentives, and earlier regulatory decisions more than it does the choices of neutral “policymakers”—a term that the Grumpy Economist also takes to task for its imprecision. Watch or listen here.
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