The rapid ascent of artificial intelligence (AI) has sparked a growing public backlash – in part, over anxiety about potential job displacement and the perceived concentration of wealth. In a new insight, Director of Competition Policy Fred Ashton discusses the recently introduced American AI Sovereign Wealth Fund Act and its effects on competition.

Key points:

• The sweeping legislative proposal, introduced by Senator Bernie Sanders (I-VT), would levy a tax equal to a 50-percent equity stake in artificial intelligence (AI) and advanced robotics firms with gross receipts exceeding $200 million – likely expanding beyond the industry’s leading firms.
• The proposed legislation builds on a growing, bipartisan narrative – shared by President Donald Trump – suggesting that direct government stakes in these firms could both benefit taxpayers and encourage more responsible management of these companies.
• Injecting the federal government into the boardroom promises to create a perverse set of incentives, ultimately robbing consumers and businesses of new products while dampening the current rapid pace of innovation.

Read the analysis.