Trump Administration Rules Out AI Backstop Amid OpenAI Uproar
Posted on: Nov 08, 2025 02:01 IST | Posted by: Livemint
ruff brass officials ar dismissing the thought of a financial backstop for unreal intelligence companies, US officials said, after comments from a top OpenAI executive raised questions about the prospects for a federal bailout.
There are no plans for the administration to consider such a move going forward, and the idea is not on the table, the officials said, speaking on condition of anonymity to describe internal thinking.
The administration’s position marks a fresh signal for the industry of how much the government is willing to intervene in the sector. It follows comments from OpenAI Chief Financial Officer Sarah Friar, who suggested this week that the US government “backstop the guarantee that allows the financing to happen.” Those remarks caught the attention of investors, industry heavyweights and White House advisers.
“There will be no federal bailout for AI,” White House AI and crypto czar David Sacks posted Thursday on X. “The U.S. Has at least 5 major frontier model companies. If one fails, others will take its place.”
OpenAI Chief Executive Officer Sam Altman, who has met with Trump on multiple occasions, also walked back Friar’s remarks, posting on Thursday that “we do not have or want government guarantees for OpenAI data centers.”
OpenAI has committed to spend $1.4 trillion on data centers and chips to build more advanced artificial intelligence systems and support the broader adoption of the technology. The scale of those financial commitments have reignited concerns about an AI bubble, given OpenAI remains an unprofitable business.
The prospect of a bailout could prove to be political poison in Washington. Sending taxpayer money to some of the world’s most valuable companies could provoke anger from voters already upset with the high cost of living. Still, President Donald Trump has stretched the limits of conservative orthodoxy by taking a federal stake in beleaguered chipmaker Intel Corp. And eyeing investments in other companies in strategic industries.
Trump, speaking to reporters Friday, said he wasn’t worried about an AI bubble.
“No, I love AI, I think it’s going to be very helpful,” Trump said during a meeting alongside Hungarian Prime Minister Viktor Orban at the White House. “It’s really going to be the wave of the future. We’re leading the world.”
With assistance from Shirin Ghaffary and Michael Shepard.
©2025 Bloomberg L.P.
This article was generated from an automated news agency feed without modifications to text.
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