OpenAI receives funds as a non-profit.
Some of those funds are redirected to for profit ventures.
Critically, the GM (Altman) of the nonprofit owns shares of the for-profit ventures, that OpenAI funds were redirected into.
A regular company could and does invest in any company even when there's a conflict, as long as the conflict is disclosed and the Board votes in favor of it. There's no criminal element there.
The problem is introduced in Altman's case if
(a) there was no disclosure (red flag) and/or
(b) nonprofit that received the funds, is putting money into things not aligned with the 501(c)(3) mission.
I'm not sure if either (a) or (b) are criminal, but they don't pass the smell test, which is why Altman is being sued in civil court, unrelated to the congressional investigation talked about in the article
When data centers and a war of choice pushed inflation to 7+% [1], Republicans in the Congress were left scrambling for a scapegoat. And Sam is a terrific scapegoat. He has no public shareholders like the more hated Zuckerberg and Bezos [2]. Yet he has carved for himself a uniquely-visibly throne for a private-company boss. (His only rival for scapegoatiness is Musk. But he’s inoculated from Republicans by his blatant partisanship.)
[1] https://www.bls.gov/news.release/cpi.nr0.htm 0.6% MoM in April, 0.9% MoM in March
Is Musk probably throwing fuel on the fire? Yes, probably. (Though we have no proof of this.)
Is Musk causing this? No. This is mainly Altman’s doing. The hyperbole. The lying. The leverage. The pomp. Even Zuckerberg and Bezos haven’t painted a target on themselves like he has. (To the point that I’m borderline sympathetic.)
> But the thing is, Molo doesn’t actually have to be good at this job, because the point of this trial isn’t to win — though I’m sure Musk wouldn’t mind a win. The point is to punish Altman, Brockman, and OpenAI. Musk has done that pretty thoroughly — reinforcing in the public’s mind that Altman is a liar and a snake. This morning, I read an exclusive in The Wall Street Journal that assorted Republican AGs and the House Oversight committee wanted to look into Sam Altman’s investments. References to the trial are peppered throughout the article.
Elon even explicitly threatened the OpenAI guys that they would be "the most hated" people on earth, and given what we've seen him do with Twitter, I strongly suspect there indeed is a submarine with Elon at the periscope.
Altman may be getting the brunt of the AI backlash, but the impact of AI is still extremely preliminary, and it will happen regardless of anything he does. As you mentioned, it doesn't help that these guys are telling the world AI will disrupt all the jobs but... at this point, I think they're just being honest.
As shifty as Altman is, I wonder how he gets more hate than Elon, who has objectively done way more concrete damage to the world.
Where things get really shady and run the risk of IRS violations is when the leadership of the non-profit has a seperate for profit stake in the subsidary.
No doubt some of OpenAI's founding principles like "stop + assist if a competitor gets to AGI first" are likely flying out the window, perhaps in part due to him and also as one might anticipate of initial lofty ideals and promises, but even with the recent New Yorker and other articles he seems like someone who maybe regularly placates people to avoid personal problems and lies to get out of trouble rather than a Machiavellian tech baron.
This would be more plausible were it not for the staggering amount of wealth he’s amassed through those lies.
Asking genuinely - why?
Why people want to believe Altman is good is about the same reason people want to believe in the second coming.
We used to be capable of so much.
Makes sense. Cue Don LaFontaine: In a world, where one man sacrificed himself for all of humanity… And they learned nothing of his lessons… In a country where people lie in his name as an excuse to hate their fellow man… Where they mock him by wearing his moment of death as jewellery¹… He’s back and adopted a new identity to slowly fuck them all and make the world burn… Johnny W Pussyfoot is Jesus in: The Second Coming.
He was fired from his first startup.
He was abruptly fired from ycombinator in shady circumstances.
He was accused by the OpenAI board of lying to them, ousted, and somehow managed to regain control.
He took OpenAI from being a non-profit to a for-profit, with obvious benefits to whoever controls it.
He was massively misleading about the capabilities of his product and predicted AGI within years.
At some point the pattern of all these events should have some weight in your judgement of him, no?
Living like that is corrupting. When you treat humans like objects, the question of your starting intentions is really secondary.
The article says the investments were disclosed:
"OpenAI board chairman Bret Taylor defended Altman in a court hearing Monday, testifying that Altman had been “forthright” and “proactive and transparent” about his involvements in other companies. Altman recused himself from recent discussions about a deal between OpenAI and Helion as well, The Wall Street Journal reported."
Regarding founder ownership, the rules are extremely flexible like a non profit director can’t own more than 20 voting or 35% total of the business venture
but if it happens then it just needs to be remedied within 3 years
so for venture style deals that’s plenty of time to dilute down, and the little known secret in the startup space is that the founders non profit steps in as the lead investor, so all the other investors arent just twiddling their thumbs waiting for a founder to convince someone, it just closes. Other investors dilute founder and non profit, everything is compliant, value is created. Both for profit and non profit side will be tax free, due to QSBS
It is all about if you can get the money back out.
You can think Altman is a bad person and OpenAI is something of a scam and still recognize that using the government as a tool to corruptly hobble your competition is a horrifyingly bad thing.
These are awful times we live in, I really fear what we'll have to be telling our grandkids. Will it be just a cautionary tale about the dangers of populism and partisanship or will it be sad, wistful tales about how much better things were... "before"?
Out of the three big geographic players, the US and China are jockeying for "most performant" models (whatever that means) with two separate approaches; the EU is trying to develop models that work best within their privacy, human rights and labour rights frameworks and laws.
All of these have have merits, though arguably the US's (de-facto) strategy of market dominance at any cost with as few restraints as possible will be the worst for society at large. The prudent thing to do would be to first determine if this is something that will actually live up to the hype (which IMO is still very much in the air), and then if it does, turns this into an international collaboration rather than a competitive enterprise.
It's not lost on me that this is a terminally naive point of view.
For what it's worth, our once-and-(hopefully)-future allies the European Union are already on board with reigning in the surveillance industry (leading by example, even). So your question is more like how can we constrain our domestic technological authoritarians when China continues to embrace theirs. And the answer is that it's not a "how". The "how" is straightforwardly enforcing longstanding concepts like personal information, antitrust bundling, unauthorized access (backdoors in sold products), etc. So your question comes down to more of a why, and the why is because it is in line with our values based around individual liberty.
I really wouldn’t conflate these two. People with documented allegations of child rape are in a separate category from diagnosed-over-the-TV types.
A plurality of American voters are stubborn and stupid and won't change their ways until they feel direct pain, so bring the pain.
AI build out / boom would be full bore without them.
Are there problems? Absolutely - there have been problems at every single second of humanity. We will always be plagued with problems at some times worse than others. That does not mean that there isn't a boom at the same time.
https://fortune.com/2026/05/12/lake-tahoe-data-center-49000-...
Sounds a bit like Wework.
Doing business with companies connected to the CEO often creates a conflict of interest. it could all be OK, of course, but OpenAI investing in companies that Altman has already invested in does not look great and needs to be investigated.
[1]: https://finance.yahoo.com/news/openai-exec-becomes-top-trump...
Which was motivated by a WSJ investigation into Sam’s personal dealings https://www.wsj.com/tech/ai/chatgpt-openai-ipo-altman-029ae6...
If any of them read books I would send them a biography of Ernst Röhm
That is why public corruption is such as plague and one of the reasons the US dollar was seen as a safe store of value once.
But the fact that OpenAI was a nonprofit and then suddenly became a for-profit is definitely something that does not feel right. I am 100% sure that it is all legal and such, but we have this mental model that “nonprofits are the good guys, run by people who just want to help humanity and nothing else.”
But that is not true, and probably never was.
> I am 100% sure that it is all legal and such
Why are you so confident on either of these statements? Seems like such a weird thing to be confident about when we know so little about the deals that went down
It’s a popular meme in Silicon Valley. Hence all the stealing.
Text-only, HTTPS optional
No CAPTCHA, no Javascript, no geo-blocking, no DDoS directed at blog
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firefox ./1.htm
links https://assets.msn.com/content/view/v2/Detail/en-in/AA22Xx2j/
Press "d" then "\"
links -dump https://assets.msn.com/content/view/v2/Detail/en-in/AA22Xx2j/ \
|sed '1,/\"body\":\"/d;/\"readTimeMin\":/,$d'Verification Required
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Trouble is, Elon Musk indirectly gave him even more.
In the words of Hitchens, "Do not imagine that you can escape judgment if you rob people with a false prospectus rather than with a knife."