Vice President JD Vance expressed concerns about artificial intelligence (AI), highlighting potential wealth creation. He argued that if AI’s benefits are limited to a small group, it might lead to communism. To prevent this, one suggestion is to expand private ownership, while another is government ownership.
The current administration’s proposals for federal ownership stakes in the AI industry echo historical communist economic strategies. President Trump is considering ways for the public to have a financial interest in leading AI firms. Meanwhile, Senator Bernie Sanders suggests the government should own half of the largest AI companies, including board representation.
If the government acquires stakes in these firms, it may shift their competitive focus. AI companies, instead of focusing on user needs, might prioritize political interests. Government ownership would not only redistribute wealth but also alter the incentive structures guiding tech companies, potentially putting bureaucratic interests above innovation.
This approach would escalate Washington’s efforts to own parts of private companies. The federal government already influences AI through standards, rules, and export controls. Owning AI companies would give the government a direct financial interest in these firms’ values.
Historically, government ownership has influenced corporate decisions, as seen during the 2008-2009 auto industry bailout. The Treasury’s role as a controlling shareholder brought political lobbying and influenced corporate decisions about dealerships and facilities. Such stakes were intended for crisis resolution, but current AI ownership proposals would institutionalize this approach.
Potential government interference might lead companies to focus on political favor over technical ability. Investors would gauge firms not just on product quality but on political connections, pressuring startups to align with government interests. Unlike the matured auto industry, AI is still evolving. Government ownership could create unfair advantages for select firms, undermining competition.
AI’s power extends beyond economic impacts. It’s crucial for accessing information, and government investment could influence how companies prioritize data accessibility and model development. Political decisions already disrupt AI tools; for example, export controls on Anthropic’s models led to suspended access for users.
To avoid these issues, Congress should oppose federal ownership in AI companies. Instead, fostering transparent, voluntary industry frameworks can address safety without government market participation. The key question is who selects AI’s winners—users or the government? The answer remains clear: users should decide.
Jennifer Huddleston is with the Cato Institute, specializing in technology policy. Tad DeHaven is a policy analyst there, focusing on general economics.