Washington Should Take OpenAI’s Equity Offer

OpenAI is offering Washington a 5% equity stake in the company. Critics call it socialism, but James Broughel argues in Forbes that an Alaska-style fund built on contributed equity is a deal Congress would be foolish to refuse.

The proposal lands at a moment when AI regulation is a top concern. OpenAI, valued at roughly $150 billion, wants to give the U.S. government a direct financial interest in its success. The idea mirrors the Alaska Permanent Fund, which distributes oil revenue to every resident annually. Broughel, a senior fellow at the Mercatus Center, says the model could channel AI profits into public dividends.

OpenAI's equity offer is unprecedented. No major tech company has ever handed the government a stake without a fight. The 5% figure is not arbitrary—it aligns with the scale of Alaska's oil fund contributions relative to state budgets. If Congress accepts, the government would become a shareholder in one of the world's most valuable private companies, entitled to dividends and a voice in governance.

Critics warn of creeping socialism. They argue that government ownership in a leading AI firm could politicize innovation, slow progress, or entrench bureaucracy. Others worry about conflicts of interest: if Washington profits from OpenAI, will it regulate the company less aggressively? Broughel counters that the Alaska fund's structure separates management from politics. The fund distributes returns without direct government control over operations.

Broader implications are significant. If Congress accepts the OpenAI equity offer, it could set a precedent for other AI companies—and perhaps other technology sectors. The U.S. currently has no mechanism for the public to share in AI-generated wealth beyond taxation. An equity stake would give citizens a direct dividend when AI boosts productivity and profits. It could also fund AI safety research, retraining programs, or a universal basic income trial.

What happens next? Congress must decide whether to accept or reject the offer. The debate will likely unfold in hearings this year. Key milestones include the Treasury Department's feasibility study, the Federal Reserve's opinion on financial implications, and public polling on whether voters trust the government with a board seat. If accepted, the OpenAI equity offer could become a landmark in public-private partnerships, reshaping how Washington engages with transformative technology.