Is It a Good Sign or a Bad Sign?
The biggest player in an emerging industry is actively making trillion-dollar commitments that are artificially propping up the economy—and now they’re asking for government support. Meanwhile, representatives of the government are weighing in. Curious? Let’s break it down.
### OpenAI’s Call for a “Backstop”
Yesterday, OpenAI’s CFO Sarah Friar made headlines during an appearance on the Wall Street Journal’s Tech Live event. She said she expects the federal government will provide a “backstop” to guarantee the company can finance its massive and rapidly expanding infrastructure of data centers.
On the same day, OpenAI CEO Sam Altman appeared on Tyler Cowen’s “Conversations with Tyler” podcast and added, “Given the magnitude of what I expect AI’s economic impact to look like, I do think the government ends up as the insurer of last resort.”
To the average listener, it might sound like OpenAI’s leadership is asking the federal government to guarantee that it won’t let the company fail—especially if OpenAI can’t generate the revenue it has projected or repay its massive financial commitments.
### The Walkback: Not Quite What They Meant
However, both executives quickly walked back those remarks.
In a LinkedIn post, Sarah Friar said the “backstop” phrasing “muddied the point” she was making. She clarified that she was referring to the idea that “American strength in technology will come from building real industrial capacity, which requires the private sector and government playing their part.” Not a direct government bailout for OpenAI.
Interestingly, when pressed during the interview if she specifically meant a “federal backstop for chip investment,” she replied, “Exactly.”
Sam Altman also chimed in with a lengthy post on X (formerly Twitter), stating, “We do not have or want government guarantees for OpenAI datacenters. We believe that governments should not pick winners or losers, and that taxpayers should not bail out companies that make bad business decisions or otherwise lose in the market.”
He added that the only government support they’ve discussed involves loan guarantees for building semiconductor fabs in the U.S.—a response to government calls for strategic investments—not for “private-benefit datacenter buildouts.”
### Government Response: No Bailouts, But Support for Infrastructure
On the government side, David Sacks, who serves as Donald Trump’s AI czar (despite limits on special government employees), made it clear on X: “There will be no federal bailout for AI.”
Instead, Sacks emphasized facilitating infrastructure buildout by making permitting and power generation easier—aiming for rapid buildout without increasing residential electricity rates.
### What Does This All Mean?
– OpenAI is *not* asking for government money to cover its enormous financial commitments that currently outpace its revenue.
– The government is *not* offering financial guarantees out of fear that OpenAI, central to a key growth sector, might fail.
– Both parties seem aligned on avoiding direct bailouts while supporting broader industry infrastructure, especially semiconductor fabs.
So, yes, everything seems very normal and on the level—glad we got that all sorted out. But of course, you’re asking for a friend.
https://gizmodo.com/why-is-the-ai-czar-already-saying-openai-wont-get-a-bailout-2000682693