OpenAI’s Contradictory Stance on Government AI Funding

The 11-page letter submitted to the White House Office of Science and Technology Policy on October 27 detailed OpenAI’s specific requests for federal support, directly contradicting CEO Sam Altman’s November 6 statement that “we do not have or want government guarantees for OpenAI data centers.” The document explicitly called for expanding tax credits and deploying “grants, cost-sharing agreements, loans, or loan guarantees to expand industrial base capacity” for AI data centers and critical grid components.

OpenAI’s letter went beyond general suggestions, providing concrete mechanisms for implementation. The company noted that “initial investments could be made using existing authorities such as the Defense Production Act Title III and the Department of Energy’s Loan Programs Office.” The document emphasized how “direct funding could also help shorten lead times for critical grid components—transformers, HVDC converters, switchgear, and cables—from years to months,” indicating detailed planning for government-assisted infrastructure expansion.

The contradiction became public when OpenAI CFO Sarah Friar told a Wall Street Journal event on November 5 that a federal “backstop” could help lower financing costs and increase debt capacity for AI infrastructure. Her comments triggered immediate criticism from prominent figures, including Florida Governor Ron DeSantis, who tweeted that the government should not bail out tech companies, and AI czar David Sacks, who declared that “there will be no federal bailout for AI.”

Facing this backlash, Friar quickly walked back her comments on LinkedIn, stating that “OpenAI is not seeking a government backstop for our infrastructure commitments” and acknowledging that her use of the word “backstop” had “muddied the point.” She attempted to reframe her position, emphasizing that “American strength in technology will come from building real industrial capacity, which requires the private sector and government playing their part.”

CEO Sam Altman amplified the retraction in a lengthy November 6 post on X, supporting Friar’s clarification while adding his own denial of seeking government guarantees. He stated that “taxpayers should not bail out companies that make bad business decisions,” creating a clear public position that conflicted with the company’s documented requests to the White House. AI researcher Gary Marcus subsequently published the October 27 letter, calling Altman’s denial “lying his ass off” and noting the explicit loan guarantee requests.

This incident marks the latest in a series of credibility challenges for Altman. In November 2023, OpenAI’s board briefly fired him for being “not consistently candid,” according to the board’s official statement. Former board member Helen Toner later detailed on a podcast how Altman had withheld information and made it difficult for the board to fulfill its oversight duties. Recent deposition testimony from former OpenAI Chief Scientist Ilya Sutskever, who voted to remove Altman, further documented concerns about his candor.

The publicly available letter on OpenAI’s content delivery network continues to undermine the company’s public positioning, raising questions about transparency in the rapidly expanding AI sector. OpenAI did not immediately respond to requests for comment about the October 27 letter or the apparent contradiction with Altman’s statements, leaving the credibility gap unaddressed as the company navigates increasing regulatory and public scrutiny.