The greatest threat to our national security is not China, it’s the growing misalignment between the government and emerging technology companies. The US government does not have a unified national agenda regarding artificial intelligence (AI) that has broad industry alignment, government investment and a clear sense of strategic imperatives. As such, global corporations are developing AI technology as suits their interests, imaginations and market potential. More importantly, the billions of dollars currently being spent by the government on AI are being spent haphazardly, and the US is falling further behind on this critical technology. Artificial intelligence will be the ultimate weapon and it might sit in the hands of a Facebook, a Google or an Alibaba.
While we understand a world in which the US government and China compete for power, we are less adept at understanding how to navigate a world where a company holds more power than the US government. When we cede power to a private enterprise, we lose all of the corollary safeguards of our democratic government. The people no longer have a say in our weaponization and neither do our elected officials.
The best recourse for aligning private enterprise and the interests of citizens and government is to create a stronger relationship between the government and the technology sector. Because investment is the fastest way to build stronger relationships and speed is of the essence, the US government needs to create a $10bn venture fund for AI and emerging technology. This fund will ensure private companies align with the US government to support nation-state interests and share ownership of rapidly advancing technologies. It will also rapidly accelerate the growth of emerging technologies.
There are examples of countries creating similar capitalized models in order to drive alignment and to rapidly accelerate the pace of development, such as:
- France recentlycreated a $5.5bn fund linking the government and private sectors.
- Canada, seeing the rise in AI technology as a potential opportunity, created a global AI hub in short order by investing in and securing support for technologies at the regional and national levels.
- China has a national-level strategy and billions of dollars in support of its AI roadmap including investments in all top Chinese technology companies.
Failure to create a fund of this sort puts our national security at risk.
How do we fund this?
The federal government is already spending $4bn to $6bn on AI. We have an opportunity to blend the coordinating efforts of government (focusing on national security) with the drive and innovation of the tech sector to ensure these tax dollars are spent wisely. The fund should have a focus on the technology that will change the way governments engage in the coming future: space weaponization and protection, cyberwar, AI, quantum computing, spatial computing and cryptocurrencies. In short, technologies that help strengthen the U.S. competitive position and safeguard the American people. Concurrently, a fund that invests and sees strong market returns has the potential to augment and improve our economy with a greater and more equitable distribution of wealth assets.
To make up the gap between the $4bn to $6bn in current investment and the proposed $10bn for the fund, the fund should also include:
- Private capital, that is, private wealth from US citizens with an interest in investing in emerging technology and supporting the US government’s security concerns.
- Pension funds, that is, follow the French model to allow pension funds to invest in traditionally high-risk industries that are de-risked in this model.
- State investment funds, that is, follow the Canadian model and allow states to align with the federal government in the investment opportunity and support the development of technology infrastructure aligned to our state and national priorities.
- Individual citizens, that is, allow individuals to invest directly in the fund in a lower risk model than an individual investment in the stock market or direct investment in a start-up/scale up (which can often be prohibitive because of required asset bar and the network required to see deal flow). This public investment would be a special investable vehicle and requisite as public engagement creates a unified tie between the American people, the government and the tech infrastructure.
How do we manage this?
The management of the fund will need to be overseen by a group of public and private individuals with a history in investing but also experience in defence, science, innovation and economic planning. These individuals should be senior enough to understand both the needs of the various government departments but also our broad vision for America in the next 50 to 100 years. In order to ensure the fund looks beyond four- or eight-term presidencies, people in positions on this board must have 10-year-long tenures. The fund would be required to report yearly on investments to the American public.
This management team must work directly with our legislative branch as it will provide recommendations for and require a shifting of current budget allocations that will need to be authorized by Congress.
How do we deploy the capital?
Investments would need to be $10m and up to scale-up companies, i.e. those companies with proven revenue, new technology and the ability to rapidly scale against the prioritized target areas. In return, the government would expect the potential financial returns that are normal for any standard market investments. These returns could be used to scale the fund, start new funds, or off-set training and other public works programs needed to support these industries.
Now what?
The growing rift between technology companies and the US government will harm our national security. We must act now to align private and public interests to rapidly scale our technology capabilities and ensure our tax dollars are spent wisely and, potentially, profitably. The best way to do this is to fund AI through a coordinated approach that brings together our country’s technology innovators and public servants.