Elon's an open holistic thinker, his thoughts lead him to the end point of what could happen. AI is automation, systems of automation. People could automate to

Elon's an open holistic thinker, his thoughts lead him to the end point of what could happen. AI is automation, systems of automation. People could automate to the point of leading to a constant flow of horrific things happening, creating a highly efficient war machine - whether against another nation or your own people. This is likely what Elon is thinking about - other than the possibility that a real AI system is developed that is given the ability to manage resources, e.g. Ex Machina (film).