Here's something that should make Silicon Valley nervous: when Senator Bernie Sanders talks about stopping AI, it doesn't sound crazy to most Americans. It sounds reasonable. That's the warning from venture capitalist Chamath Palihapitiya, who thinks the tech industry is sleepwalking into a political disaster.

Speaking on the All-In Podcast this week, Palihapitiya issued a stark message to his fellow tech leaders. The growing anti-AI sentiment isn't spreading because it's radical. It's spreading because everyday Americans look at the AI boom and see rising electricity bills, looming job losses, and a shrinking future for their kids while tech billionaires celebrate stock price surges and circular deal-making.

The Disconnect Between Wall Street and Main Street

Palihapitiya diagnosed what he calls a catastrophic "perception issue" in the tech industry. While Silicon Valley celebrates capital flows and booming valuations, Main Street sees something entirely different. The average American isn't benefiting from the AI revolution. They're worrying about it.

"The reason [Bernie Sanders' message] went viral was not because it sounded so crazy, but because to some faction... it sounded rational and reasonable," Palihapitiya explained.

He warned that a small percentage of elites are reaping the rewards of the AI boom while the majority feel what he called the "sword of Damocles" hanging over their heads. That's a problem that goes beyond bad PR. It's an existential threat to the industry's ability to operate without heavy-handed regulation.

The Gilded Age Playbook

So what's the solution? Palihapitiya thinks modern tech moguls should take a page from the industrialists of the Gilded Age. Andrew Carnegie built 2,500 libraries to ensure the public benefited from the industrial revolution. Today's AI giants, Palihapitiya argues, need to use their massive balance sheets to improve education, housing, or healthcare in ways that are tangible and measurable.

And they need to cut out the stuff that alienates voters. "Enough of the stupid haircuts, dumb watches, ugly clothes... It has to stop," he urged. "We need to start doing things that are practically measurable by tens of millions of American citizens."

In other words, less spectacle, more substance. The optics of wealth concentration matter, especially when people are struggling.

The Political Battle Intensifies

Palihapitiya's warning comes at a moment when the political fight over AI is heating up. Senator Sanders has recently sounded the alarm over what he calls "Big Tech Oligarchs" pouring hundreds of millions of dollars into Super PACs to defeat pro-regulation candidates. This is exactly the kind of dynamic Palihapitiya fears will deepen the class divide and fuel populist rage.

Politicians, Palihapitiya noted, have an "incredible sense of self-preservation." If the tech industry fails to provide what he calls a "social dividend," he predicts that populist calls to halt AI progress will inevitably translate into restrictive legislation. And once that happens, the innovation slowdown could be severe.

The stakes are high. Tech leaders need to urgently pivot from generating stock market wealth to delivering tangible public benefits, or risk losing the political battle entirely.

AI Investment Options

For investors looking to gain exposure to AI-related stocks, here are some technology-focused ETFs worth considering: