My response to Cory Doctorow in his post, “How much (little) are the AI companies making?” (link)
Absolutely. This sparked a crazy idea… hear me out? Just brainstorming.
If a company gets to the stage where it has a monopolistic domination of its market and no longer faces meaningful competition, it has effectively become infrastructure (Google: search, Amazon: two-sided marketplace w/ logistics, Facebook: social networking). For infrastructure, from roads to fire departments, market competition is either impossible or detrimental, and the best manager of these resources, while nothing is perfect, is the government: the government should be empowered to aquire certain companies or parts of companies at a fair market value. By transforming uncompetitive monopolies into public infrastructure, we realign incentives toward serving public interests rather than shareholder profits.
One of the primary concerns here is surely data privacy. Can we trust the government with sensitive data? However, the alternative—leaving data in corporate hands—is also demonstrably risky, as corporations actively sell and exploit user data without sufficient oversight. On the other hand, governments already maintain internal data firewalls between departments (such as law enforcement and healthcare) and at least have the public’s interest in mind… on paper… or had… current US government aside. Anyway, this might be a wash; don’t trust anyone with your data (oops, too late). 😅
Notably, this isn’t an exit strategy for all companies. Many (most) companies reach a steady state in a healthy equilibrium with a competitive market (think Nike or Coca-Cola). Healthy competition is clearly the best way to keep shareholder extraction in check, as healthy market forces will not tolerate enshittification; shareholder value remains rightfully tied to the quality of the product. However, when companies acheive market domination, their shareholders often shift focus from improving products to extracting maximum financial value for themselves, leading to diminishing quality and stagnant innovation (enshittification: a tumor on society), and using this wealth and dominance to retain control.
At this stage, a government might be uniquely positioned, financially and institutionally, to purchase the profitable company at a fair market valuation. Investors would realize their gains through this exit strategy, freeing capital and innovation to reinvest in other growing ventures. Indeed, since the company is profitable, employees, including key executives and engineers deeply familiar with the product, could remain without a paycut, maintaining continuity and ensuring operational stability.
Finally, as government controlled infrastructure, there wouldn’t be the same priority placed on retaining market dominance at all costs. If quality were to decrease or new innovations begin to leave the system behind, fresh new companies would have the breathing room to bring competition back into the space (the outcome of which could take a great many forms). So the space in general might see increased innovation as there isn’t a market leader suppressing it.
While trusting the government with more data and relied upon services may be uncomfortable, it’s arguably preferable to leaving such power in the hands of private entities whose sole incentive becomes profit extraction. While nothing is perfect or without drawbacks, this might create a healthier, more transparent, and socially aligned structure that mitigates the worst outcomes of unchecked growth.