“Government Shouldn’t Pick Winners”—But They Must Pick Boundaries
When Cognitive Infrastructure Becomes National Infrastructure
The Clarity After the Controversy
In November 2025, OpenAI’s CFO Sarah Friar sparked a firestorm when she suggested at a Wall Street Journal event that the U.S. government should provide “backstops”—loan guarantees—for the company’s trillion-dollar infrastructure buildout. The backlash was swift and severe, with David Sacks, the White House AI czar, declaring flatly: “There will be no federal bailout for AI.”
Sam Altman moved quickly to clarify: “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.”
On this specific point—that taxpayers shouldn’t underwrite private company failures, Altman is absolutely right. Markets need failure. Creative destruction is capitalism’s immune system, and weakening it creates moral hazard at scale. The 2008 financial crisis proved this with brutal clarity: when private profits are privatized but l…
