Former DHS Chief Janet Napolitano Says the Biggest AI Risk Isn’t Losing to China

As more incidents of AI systems going rogue gain traction, concerns are amplifying around the tightrope act of how to regulate the rapidly evolving artificial intelligence sector while ensuring that the United States can preserve its competitive edge against China. 

But the question of beating China may not be the right one—and the United States might face an even larger challenge right here at home, according to Janet Napolitano, the former secretary for the Department of Homeland Security. Napolitano led the DHS from 2009 to 2013 under former President Barack Obama. 

“The national security implications of AI are immense—I won’t downplay that, but the binary that we either win or we lose to China, I think, is inaccurate,” Napolitano said Thursday during a panel discussion at the Inc. 5000 Conference and Gala in Dallas. “China has the same risks that the United States does. What we don’t have is any way for these two great powers to really interrelate in a productive way.”  

The challenge at hand, as Napolitano sees it, is less about beating China and more around fostering public trust in the technology. The rollout of artificial intelligence has caused people to be resistant and skeptical that large AI companies are acting in the benefit of the public interest.

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An August poll from Pew Research Center shows that half of Americans are more concerned than excited around the idea of using AI daily. People often cite concerns related to job displacement, increasing costs of electric bills to power data centers, and recent talks that AI could lead to the outright extinction of the human race. 

But it’s important to restore that trust, Napolitano says, since the adoption of AI is turbocharging economic growth.

The widely-discussed benefits of AI are tantalizing: Some AI proponents believe that it could lead to the cure for cancer and can unlock the unthinkable in difficult fields like quantum computing. At the same time, major AI companies are burning through cash quickly with little to show for it. 

The large hyperscalers are hurdling towards $800 billion in AI capex this year. For perspective, that outpaces the GDP for many countries—for example, Argentina’s GDP clocked in at $683 billion in 2025. Singapore’s was around $604 billion.

Echoing Napolitano’s concerns was Eric Ries, the founder of Long-Term Stock Exchange, who, on the same panel, underscored that another major pain point for the country is how AI is poorly governed. That’s a question that ultimately falls onto Congress—and meanwhile, lawmakers have struggled for years on how to best proceed.