The AI-Driven Panic Trap (or How the Room Lost Its Goddamn Mind)
AI Leadership Skill #5: How to prevent panic from driving your decisions
I hit a usage limit on Claude last week. It was my first time getting the pop-up telling me I couldn’t continue working until later that night.
I suspected I’d encounter one of these moments sooner or later. Everyone knows limits exist. But when it happened, I felt, I don’t know, frustrated? Disappointed? My computer was telling me I couldn’t work on my presentation anymore. Maybe the emotion I felt is disempowered.
Whatever the name for the feeling in that moment, it was the first time in a long time I was jolted into the realization that something I thought I owned was not, in fact, mine.
(For anyone conscious in the 1990s: DRM did the same thing to your 99¢ iTunes song: you paid for it, but Apple decided where you could play it.)
Scarcity is a virus
Scarcity-centered thinking is driving a lot in business and the world right now. This is the assumption that the things we need most—compute, capital, jobs—are finite, and we need to fight for, race to, and beat others to get them.
In addition to limited tokens, here are two other instances I’ve noticed:
The job market. People are sending out 50, 100, 150 applications and getting nothing back.
The IPO race. SpaceX, Anthropic, and OpenAI are fighting to not be the last to IPO in order to get the most pop on their offering. Even public companies like Alphabet and Meta are attempting to get in by selling large equity stakes. The whole thing feels less like a funding round and more like a land grab.
All of it smacks of constraints and rarity. But I don’t believe it has to.
I recently spoke to a leadership coach who teaches an abundance mindset as a skill to executives and leaders. That conversation helped me see how much of the discourse right now is centered around limited resources.
The problem is that this way of thinking is creeping into leaders’ decision-making in ways that will be hard to undo.
In February, Jack Dorsey, CEO of Block, cut 40% of of his workforce. Ten thousand employees down to under six thousand—proportionally, the largest AI-linked layoff in corporate history. The stock jumped 20%.
He pointed to AI as the reason, and then pronounced that most companies would follow with similar layoffs within a year. Maybe he’s right. But when a figure with his gravity says it, he isn’t just predicting the future. He’s manufacturing it. Other leaders hear that and feel what he wants them to feel: they’re already behind, that hesitation is failure, that the window is closing.
That’s just one example of how scarcity thinking spreads like a virus.
Derby Dads
Last weekend, I was at my daughters’ roller derby practice. (Yes, we live in Portland. Yes, derby is very much a thing here. And, yes, it’s as badass as it sounds.)
I got talking to another Derby dad. Software engineer at Stripe, a fintech company like Block. I asked him what it felt like inside the company right now. He said: While they’ve slowed hiring considerably, they’re definitely not doing layoffs. A very different message from Block.
Stripe has been kept private on purpose. The Collison brothers, co-founders and leaders of the financial tech firm, don’t feel like they need an IPO. They’re up 34% to $1.9 trillion in payment volume. They have $2.2 billion in free cash flow. They can afford to breathe.
And that’s what it sounded like inside—like people were breathing.
That contrast is clear. Same industry, same technology moment, same pressure from the outside world. Completely different atmosphere. One organization makes decisions from a place of scarcity and urgency; the other moves forward but doesn’t take the bait.
I’ve spent the better part of two decades helping teams and organizations make better decisions. One thing I always see—in culture work, in strategy, in how teams absorb change—is that the tone leaders set at the top is not just symbolic. It always carries weight, rippling down through every layer of the organization.
When a leader operates from panic, that panic doesn’t stay in the boardroom. It lands on managers. Managers pass it to teams. Teams feel it in the decisions that land in front of them. Bigger swings, more errors, less trust.
I’ve been thinking about this condition and how to put language to it so that leaders at every level can make better choices. The Panic Trap is a framework for anyone who understands that scarcity thinking is a choice and who wants help navigating this moment.
It won’t make the hard calls easy, but it can help you move from making decisions out of fear to making them out of clarity.
The morning after I hit that usage limit on Claude, I went back in and finished what I was working on. The four hours passed. The work was still there.
Some of the urgency is real, but I’m willing to bet most of what feels scarce right now isn’t. Knowing the difference might be the most important leadership skill of this moment.
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