Earlier quoted context omitted.
Distills are bad for the US economy because they compress margins that otherwise go to pushing the frontier. You'd see model progress dramatically slowed if US companies had to compete on distills.
bad for the US economy but good for the World economy.
Almost certainly not in the long term. If AI is a productivity enhancer, which I think we have evidence for, then the American economy’s heft (and continuing dynamism) get a tailwind. The minority of the new, leveraged economy getting hit will be a short-term painful adjustment, but it need not be anything more.