David Sacks, President Trump’s advisor on artificial intelligence and cryptocurrency, faces criticism over government paperwork that allows him to shape U.S. policy while maintaining hundreds of investments in the tech industry. According to NPR, ethics experts say his waivers lack rigorous oversight and could enable personal profit from his government role.
Sweeping Ethics Waivers Draw Scrutiny
Sacks is a venture capitalist and member of the PayPal Mafia group. He divested from some holdings like Amazon and Meta. But public documents show he and his firm, Craft Ventures, maintain more than 400 investments in tech firms with AI ties.
Kathleen Clark, a government ethics expert at Washington University in St. Louis, called the waivers highly unusual. She said they lack objective ethics analysis and are like a presidential pardon in advance. The waivers allow actions that would normally violate criminal conflict of interest laws, she added.
Silicon Valley Rallies Behind Sacks
After The New York Times investigated Sacks‘ holdings, dozens of tech industry friends defended him on X. Billionaire Salesforce CEO Marc Benioff praised Sacks and criticized the newspaper. Sacks hired a defamation law firm to send threatening letters to the Times. He also said on his podcast that he divested hundreds of millions of dollars at substantial cost to his net worth.
State AI Laws and MAGA Divisions
The controversy comes as Sacks helped shape an executive order signed by Trump on Thursday. The order instructs the Justice Department to challenge state AI laws deemed burdensome to the industry. More than 100 state laws now regulate AI, mostly targeting deepfakes and requiring transparency.
OpenAI, Google and venture capital firm Andreessen Horowitz lobbied for the measure for months. They argue a patchwork of state laws could hamper the AI boom and give China an advantage. But the move has drawn resistance from AI safety advocates and within the MAGA movement.
Steve Bannon, Trump’s former chief strategist, opposes Sacks‘ policies. He told NPR his bigger problem is Sacks‘ judgment, not just conflicts. Bannon also expressed concern that Sacks and allies could push for a taxpayer bailout if the AI investment bubble bursts. Two years ago, Sacks advocated for a government rescue of Silicon Valley Bank. The federal government stepped in to backstop $175 billion in deposits.
Sacks wrote on X last month that there will be no federal bailout for AI. But weeks later he warned that a reversal in AI investments would risk recession.
