U.S. Democratic Senator Bernie Sanders has introduced legislation proposing a one-time 50% equity tax on the nation’s largest artificial intelligence companies to establish a sovereign wealth fund, granting the federal government voting rights in AI corporate governance and distributing the benefits of AI industry growth to all American citizens.
According to Bloomberg, the bill, titled the “American AI Sovereign Wealth Fund Act,” will be formally introduced on Thursday. Under the proposal, the federal government would obtain equal board representation at each company through its ownership of voting shares and gain the authority to block decisions detrimental to the public interest.
Sanders stated that he has not yet discussed the bill with the administration but believes it has bipartisan support among members of Congress.
The proposal poses a potentially significant financial impact on leading AI firms. If enacted, affected companies would face substantial equity dilution. Sanders also noted that AI companies wield considerable political influence, which he identified as the primary reason Congress has thus far struggled to pass effective regulatory legislation.
The bill was introduced amid broad congressional discussions on AI regulation but remains highly uncertain as to whether it will advance into law.
Core Mechanism of the Bill: Equity Tax and Board Representation
The bill applies to AI companies with annual revenues of at least $200 million. A one-time 50% tax on their stock would generate funds to be channeled into the aforementioned sovereign wealth fund. Earlier this month, Sanders stated in a Senate address:
"If AI companies continue their rapid growth as many analysts anticipate, the value of this fund will increase accordingly, and so too will the returns for the American people."
On the governance front, the federal government would secure equal board representation at each covered company through its voting equity stake, granting it institutional authority to veto decisions that harm the public interest. Sanders remarked:
"Under this mechanism, the future of AI—and the transformative changes it will bring to human life—will no longer be dictated by a handful of powerful tech oligarchs."
Regulatory Logic: Preventing Monopolistic Control of AI by a Small Elite
In explaining the rationale for the legislation, Sanders stated that this 'transformative technology must not be controlled by a handful of the wealthiest individuals on Earth, whose sole objective is to make as much money as possible.' He argued that the direction of AI development should serve the public interest rather than be unilaterally determined by a tiny minority.
Criticizing congressional inaction on regulation, Sanders highlighted the political influence of the AI industry: any member of Congress who begins discussing reasonable regulation will face massive campaign advertising campaigns funded by 'unlimited resources' from the AI sector.
This bill continues Sanders’ recent series of actions aimed at regulating AI. In March of this year, he co-sponsored legislation with Representative Alexandria Ocasio-Cortez (D-NY) designed to halt the development of new AI infrastructure.
Sanders currently serves as the Ranking Member of the Senate Committee on Health, Education, Labor, and Pensions and has been actively involved in overseeing the AI industry.
Editor/Liam