LinkedIn Co-Founder Reid Hoffman Warns of Potential Conflicts in Trump's AI Policies

LinkedIn co-founder Reid Hoffman warns against Elon Musk's 'conflict of interest' in setting AI policies

Reid Hoffman, co-founder at LinkedIn and Inflection AI, shared his expectations for the incoming Trump administration in an opinion piece for the Financial Times. And while he appears hopeful that President-Elect Donald Trump could clear the way for more competition and faster innovation in the technology industry, Hoffman also expressed concerns around Trump providing certain individuals and companies with favored status in a way that could harm American innovation. One individual with his hands in several technological pies that Hoffman says could gain from Trump's ascendance is Elon Musk, the CEO of Tesla, SpaceX, and xAI, and owner of The Boring Company, Neuralink, and X. Musk, alongside Vivek Ramaswamy, will also head up a planned advisory commission called the Department of Government Efficiency (DOGE). Hoffman called Musk's ownership in xAI in particular "a serious conflict of interest." "Using his position to favor xAI in any way, such as awarding it government contracts, encouraging federal agencies to unfairly target AI companies, or imposing new regulations that limit exports will come at the expense of U.S. technological, economic and cultural security, and competitiveness," Hoffman wrote. Tesla, SpaceX, and Neuralink are all also in highly regulated sectors, the agencies governing which could experience layoffs or other influence from Musk in his role at DOGE. Hoffman, who backed VP Kamala Harris's nomination and has been an outspoken critic of Trump's presidency, also highlighted the potential benefits and drawbacks to Trump's support of crypto. He said that "ending arbitrary enforcement policies against the cryptocurrency industry" as seen under the Biden administration could create a "more stable environment for blockchain innovation." But he questioned whether Trump will "use his new embrace of crypto, and his regulatory authority over it, as a way to privilege a few favored coins?" Trump has his own crypto venture, World Liberty Financial, with a native token that launched in October, and is reportedly working on a new stablecoin that can serve as a stand-in for the U.S. dollar. There have also been reports this week that Trump Media, the president-elect's social media company, is in advanced talks to acquire cryptocurrency trading platform Bakkt. Hoffman's concerns that Trump might play favorites are not unfounded. As he noted in his piece, in Trump's first term, the president-elect "targeted a number of iconic U.S. companies for personal and political reasons, creating constant chaos and uncertainty." For example, Trump frequently criticized Amazon and its CEO Jeff Bezos, accusing the company of unfairly benefitting from USPS rates, which led to policies scrutinizing Amazon's deals. Bezos, who owns The Washington Post, now appears to be amenable to Trump, and has defended his decision to withhold the newspaper's endorsement of Harris. Musk also has a reputation for publicly challenging and criticizing competitors and people he disagrees with. The path to his acquisition of Twitter, now X, was littered with public critiques of the platform's leadership and business model. Hoffman -- who helped fund E. Jean Caroll's rape case against Trump, criticized him as a "convicted felon and pathological liar," and has expressed fears that the president-elect would retaliate against him and others in business -- ended on an upbeat note despite his skepticism. "I very much hope that Trump succeeds wildly in enabling US entrepreneurship and innovation, increasing wages for workers and creating a country where every American is free to pursue their ambitions with dignity, purpose and a sense of belonging," Hoffman wrote. "That's why I will continue to do everything I can to build the next generation of companies that bring life-changing opportunities for individuals and society."

Reid Hoffman: What Trump means for Silicon Valley

The writer is co-founder of LinkedIn, co-founder at Inflection AI and a partner at Greylock As the US prepares for a shift in leadership that will massively impact how America does business, there are many reasons for optimism. Once again, Donald Trump will be inheriting a strong Democrat-engineered economy. During Joe Biden's presidency, full-time employment has surged. GDP growth has been robust. Average hourly earnings are on an upward trajectory. The Chips Act is also set to have a sweeping impact. With its focus on reshoring US semiconductor production, it has allocated major funding for projects in Arizona, Texas, Ohio, Utah and other states. This will create thousands of new jobs and improve US global competitiveness. I put significant effort into electing vice-president Kamala Harris. Nevertheless, I am hopeful that president-elect Trump will build upon Biden's work and reduce inflation, enable high-tech innovation and increase investment in US business. Some of my peers in Silicon Valley who supported Trump in this election did so in the belief that his administration will strike a pronounced innovation-friendly stance. If they're right, and I hope they are, then we should see more competition, faster improvement and fewer efforts to dictate goals and outcomes in complex, fast-evolving high-tech industries. Trump's administration will probably stop the chill put on M&A in the tech sector by the current Federal Trade Commission; this would be a great thing for start-up innovation and scale-up investment. With the developments regarding the Department of Government Efficiency, it appears that the Trump administration may even expand on the "one in, two out" deregulatory posture of his first term. (If you want a new regulation, you must eliminate two existing ones). If managed effectively, such ambitious restructuring could create great opportunities for innovation and new business. In the coming years, with demand projected to skyrocket from artificial intelligence and other domestic needs, America's energy independence will be key. So we must adopt an efficient regulatory environment for developing solutions. The faster we can ready new nuclear power plants and other new energy, the faster we can reduce our reliance on fossil fuels and reliably meet the energy demands of millions of people in sustainable fashion. I anticipate cutting through a lot of red tape on energy for the power we need for AI -- and that would be incredibly positive. Another reason that some, especially in Silicon Valley, supported Trump was because of his pro-crypto posture. The thought is that he will move away from the generally anti-crypto stance, with unclear rules, that the Biden administration pursued. This would be fantastic. Ending arbitrary enforcement policies against the cryptocurrency industry would create a much more stable environment for blockchain innovation and fostering secure, decentralised financial systems. However, the administration's potential approach to crypto also highlights some key worries. Will Trump's pro-crypto stance ensure the general rule of law for all companies? Or will he mostly use his new embrace of crypto, and his regulatory authority over it, as a way to privilege a few favoured coins? And that's just the start of my worries for American and global business. In his first term, Trump targeted a number of iconic US companies for personal and political reasons, creating constant chaos and uncertainty. Because of advances in AI, we're moving into an era where the federal government's relationship with America's leading tech companies is two-fold. First, the government must make prudent regulatory moves -- which broadly means aiming for a permissionless innovation approach that allows US companies to stay globally competitive. Second, the federal government itself must increase its own use of AI and other technologies in ways that make it more efficient and productive -- and more tuned to the needs of serving citizens. On this count, I fear that things will be very challenging. While Trump campaigned on the promise of making America more unilateral and insular, I continue to believe a pluralistic, multilateral approach is what creates innovation and prosperity in an increasingly networked world. That extends to AI. In contrast, I expect the administration will adopt a mercantilist AI policy that will bar long-standing global allies from accessing US models, infrastructure, and technology. With direct ownership in the fledgling AI start-up xAI, Elon Musk, who is advising Trump in many domains, has a serious conflict of interest in terms of setting federal AI policies for all US companies. Using his position to favour xAI in any way, such as awarding it government contracts, encouraging federal agencies to unfairly target AI companies, or imposing new regulations that limit exports will come at the expense of US technological, economic and cultural security and competitiveness. More broadly, though, I very much hope that Trump succeeds wildly in enabling US entrepreneurship and innovation, increasing wages for workers and creating a country where every American is free to pursue their ambitions with dignity, purpose and a sense of belonging. That's why I will continue to do everything I can to build the next generation of companies that bring life-changing opportunities for individuals and society.