- The government is not a business, Reid Hoffman argued, and should not be run like one. The investor and LinkedIn cofounder told Bloomberg TV on Monday that he worries President Donald Trump’s administration is taking unnecessary risk through its mass firings that are endangering the U.S. Unlike a company, governments must sacrifice some efficiency to avoid risks because large-scale financial security depends on it, he said.
LinkedIn cofounder and investor Reid Hoffman has challenged the Silicon Valley-inspired “move fast and break things” approach to President Donald Trump’s administration and the Department of Government Efficiency.
The venture capital partner at Greylock and cofounder of Manas AI warned Trump’s sweeping government changes could pose a threat to U.S. security. But it’s not the rate of shifts that are as concerning to Hoffman as the scope and rashness of them.
“I worry that very bad risks are being taken,” Hoffman told Bloomberg TV on Monday. “Speed is not a problem. Risks are a problem.”
“For example, it’s like, ‘Well, we’re just going to fire a whole bunch of people. Oh, oops, we fired a whole bunch of nuclear safety inspectors,’” he added. “That’s the kind of thing that is taking risks that [are] unwarranted.”
The Department of Energy last month sought to rehire hundreds of nuclear bomb specialists after abruptly firing them.
Meanwhile, the Trump administration and the Elon Musk-championed DOGE terminated 17 inspectors general last month—including Robert Storch of the Department of Defense and the State Department’s Cardell Kenneth Richardson.
The firings, as well as orders to eliminate entire agencies, are part of the administration’s large-scale bureaucratic culling that Trump and his allies have argued is a mass cost-cutting effort.
Experts, including Theresa Payton, a former White House chief information officer under President George W. Bush, said the mass firings of those with insider government knowledge have created an opportunity for countries like Russia and China to recruit possible informants.
“This information is highly valuable, and it shouldn’t be surprising that Russia and China and other organizations—criminal syndicates for instance—would be aggressively recruiting government employees,” she told the Associated Press.
Government’s risk averse ethos
Economists and investors have also begun to warn of the dangers of these disruptions, with Danny Moses, an investor who predicted the 2008 financial crisis, saying markets have not yet priced in the impacts the spending cuts will have on the private sector’s government contracts—which topped $759 billion in fiscal 2023—not to mention the influx of laid-off workers hitting the labor market.
Hoffman thinks the government should not be run like a business, as businesses do not have to contend with the same scope of financial security and safety as a country’s leadership.
“Governments are not companies,” he said. “You actually have to say, ‘We take less risk here, even at the price of some inefficiency, because it’s more important for us to not have things blow up.’”
Some agencies are already warning of the consequences Hoffman outlined. The Federal Deposit Insurance Corporation, one of the U.S.’s primary bank regulators, said in a report this month that its insufficient staffing, in part a result of Trump and Musk’s mass cuts, would prevent it from carrying out soundness exams of banks’ heath that “ensure public confidence in the banking system.” Banks’ failure to sufficiently address their unrealized losses contributed to the 2023 banking crisis.
Hoffman has long butted heads with Musk and Trump, even reportedly considering leaving the country out of fear of retaliation from the administration. Hoffman donated at least $10 million to former Vice President Kamala Harris’s presidential campaign and helped finance E. Jean Carroll’s private sexual assault lawsuits against Trump.
Musk reportedly linked Hoffman with now-deceased financier Jeffrey Epstein, who was charged in 2019 with sex trafficking dozens of minors. Hoffman denied Musk’s claim and said he hired additional security because of the conspiracy theories. The two entrepreneurs used to be friends, having both been members of the PayPal Mafia.
Hoffman and DOGE did not respond to Fortune’s requests for comment.
Regulating the ‘cognitive industrial revolution’
Hoffman’s prioritization of U.S. safety was reflected in his views on the regulation of AI, the development of which he called the “cognitive industrial revolution.” He told Bloomberg TV regulations of the technology should be primarily to prevent terrorism and cyber crimes. Companies should have to create a safety plan and implement measures to ensure the technology doesn’t “bleed” to terrorists and bad actors, he said.
At the same time, Hoffman advocated for “minimal regulation” of AI, arguing against trying to eliminate the biases he said many AI companies are already working to eliminate because ironing out the wrinkles in the technology will be part of its evolution.
“If you tried to make everything perfect with cars before you put them on the road,” he said, “we’d never have cars.”
This story was originally featured on Fortune.com
