As artificial intelligence continues to revolutionize countless traditional industries and sectors across the globe, even the United States government can no longer ignore this tech innovation, pushing to integrate AI across many of its sprawling operations through initiatives like DOGE. From streamlining citizen services to bolstering defense intelligence, AI promises to transform how government agencies function in the near future.
However, despite all its benefits, AI’s explosive growth and prevalence have unearthed some new challenges as well, one of the biggest being the near-total monopolization of government AI infrastructure by just a handful of closed-source providers. Such consolidation doesn’t just prompt inefficiency — it creates vulnerabilities in national security, a transparency crisis, and a direct obstacle to long-term innovation. If left unchecked, the situation can result in a dangerous dependency that could undermine public trust and sovereignty.
Homogeneity Breeds Homogeneity
Today, roughly 90% of current U.S. government AI contracts are awarded to a single closed-source provider, according to a research report published by the Open-Source AI Foundation. This staggering concentration means that a single company’s systems process some of the most sensitive data in the nation — from civilian records at the DMV to classified intelligence within defense agencies.
Naturally, such centralization creates a single point of failure with catastrophic potential, where a data breach, a system outage, or even deliberate misuse could negatively impact countless critical government functions. Furthermore, closed-source systems exacerbate this risk by operating as “black boxes” since their code is hidden from the general public, data-handling practices are opaque, and priorities are ultimately dictated by corporate interests rather than the public good.
Apart from security concerns, this monopoly stifles innovation and inflates costs because proprietary AI solutions lock government agencies into expensive, inflexible contracts that discourage competition and free market rules. Moreover, the taxpayers bear the brunt of these unnaturally inflated price tags, while government agencies are left dependent on systems they cannot fully control or audit.
The lack of transparency also raises ethical questions. When AI processes sensitive government data, agencies can’t guarantee responsible handling when the underlying algorithms are shielded from scrutiny. For instance, recent reports of AI being used to monitor federal workers’ communications for political loyalty prove the numerous dangers of deploying unaccountable systems at the highest level of the U.S. government.
Open Source, Open Mind
Luckily, there is a better way forward, which is already available — open-source, decentralized AI. Nations like Switzerland, for instance, serve as a great example of how AI development can innovate while still remaining fair and transparent. Recently, the Swiss government has mandated open-source technology to be used for all its systems, prioritizing transparency and citizen collaboration and strengthening the country’s security and public trust.
Considering Switzerland’s experience, the U.S. now risks falling behind if it continues to rely on proprietary systems that obscure their inner workings and prioritize vendor interests. Open-source AI, by contrast, invites scrutiny, encourages innovation, and ensures that technology serves democratic values rather than corporate agendas.
As American tech giants — which once were wary of defense and public sector work — are now actively pursuing government AI contracts worth hundreds of millions and doubling down on lobbying efforts to shape AI policy in their favor, the U.S. is facing non-illusionary risks of vendor lock-in and anti-competitive dynamics.
While Washington debates the future of AI policy, it must confront these risks of centralized control head-on. The White House’s recent directive to prioritize “American AI” and appoint chief AI officers is a great step in this direction already, creating an opportunity to rethink how we build and deploy these systems.
Going forward, we need policies that prioritize verifiable, cost-effective, and modular solutions and empower agencies to innovate responsibly without compromising security or sovereignty. Decentralized, open-source AI isn’t just a technical alternative — it’s a strategic imperative to safeguard our nation’s future.
