National treasure Matt Levine presents a third theory of corporate governance. (Theory 1: shareholders should have control. Theory 2: visionary founders should have control.)
The third theory is that AI is so powerful, transformative and potentially dangerous that AI firms must be run for the benefit of humanity. They shouldn’t be controlled by shareholders or by founders. They should be controlled by a wise body of philosophers with no economic stakes, whose only goal is maximizing the benefit of AI for humanity. Where you find these philosophers is an interesting question. Some AI theorists. Some effective altruists. Larry Summers. I don’t know.
The third theory was tested back in 2023, when OpenAI’s nonprofit board fired its visionary founder-CEO, Sam Altman, for like two days. That did not work! It turns out that if you are raising tens of billions of dollars from investors for a trillion-dollar business, you cannot actually give the final say over that business to a wise body of philosophers with no economic stake in the business. When I put it like that it seems obvious, but for a while OpenAI was pretty confusing.
Still, a big part of the pitch that the AI labs make to investors and employees is along the lines of “this stuff is too powerful to be left to index funds.” An AI lab that went public with single-class stock and no special control rights — one whose directors were just answerable to shareholders — would be suspicious; nobody would believe it was serious about AI. “AI is too important to be left to shareholders,” everyone thinks, even the shareholders.
The obvious approach — the one taken by SpaceX — is to fall back on founder control: You can’t trust shareholders to develop AI in a responsible way, and you can’t trust disinterested philosophers to maximize value, but you can definitely trust Elon Musk to do both. Arguably there are problems with this theory.
Speaking of Larry Summers. This scene in The Social Network really hits different now because of, well, Larry Summers. And Armie Hammer.