Ranking Member Maxine Waters and Congressional Progressive Caucus Chair Greg Casar introduced a resolution opposing federal bailouts for artificial-intelligence companies and executives if an AI-related asset bubble collapses. The Democrats said federal support should instead protect workers, retirees and low-income communities from economic harm.
The resolution, introduced October 29, 2026, warns about risks from AI-related borrowing and calls for federal action before a downturn. Eleven other representatives joined Waters and Casar in leading the measure: Danny Davis, Chris Deluzio, Valerie P. Foushee, Jesús “Chuy” García, Pramila Jayapal, Analilia Mejia, Delia Ramirez, André Carson, Jan Schakowsky, Brad Sherman and Rashida Tlaib.
Member Maxine Waters Challenges a Corporate Bailout
Waters, the top Democrat on the House Financial Services Committee, said technology companies and Wall Street were taking risks with billions in borrowed money to fuel the AI boom. She argued taxpayers should not rescue them if their bets fail, citing the 2008 financial crisis as a warning.
Waters said banks received bailouts while millions of Americans lost jobs, homes and retirement savings. Casar said AI companies that fail should go bankrupt and executives who commit fraud should face accountability. He said federal help should go to workers and retirees.
The lawmakers’ resolution says AI-related firms hold trillions of dollars in debt, much of it raised in opaque and unregulated private credit markets. It also says the stock market’s price-to-earnings ratio is almost as high as at the peak of the 1990s tech bubble. Those are claims made in the resolution, not findings of an independent review.
Resolution Rejects Aid for Insolvent AI Firms
The measure urges Congress and federal agencies to oppose rescue measures for insolvent AI-related firms and protections for senior executives facing accountability for reckless conduct. It also opposes emergency lending or direct capital infusions that would prop up insolvent companies or prevent ordinary bankruptcy proceedings.
It calls for executives whose risky or illegal behavior leads to a firm’s insolvency to be held accountable under civil and criminal law. The resolution says they should return ill-gotten gains, naming mansions, vacation homes, private planes, yachts and other assets.
The proposal further argues federal regulators have avoided robust scrutiny of complicated debt and equity schemes used by AI firms. It also points to what the lawmakers describe as the Trump White House’s deregulatory focus and conflicts of interest related to AI.
Member Maxine Waters Calls for Worker Protections
Rather than corporate rescues, the resolution calls for federal spending to create jobs and protect state and local government services. It also supports unemployment insurance, nutrition support and housing assistance, alongside protections for pension and retirement fund holders who may face losses if an AI bubble collapses.
The lawmakers call for additional transparency and accountability requirements to prevent future speculative bubbles. They also support automatic economic stabilizers, described in the resolution as investments that begin flowing immediately during an economic downturn to support workers and consumers.
The measure was endorsed by 13 organizations, including the American Federation of Teachers, Americans for Financial Reform, the Center for Responsible Lending and Social Security Works. The resolution sets out the sponsors’ position on any future government response; the source does not report its passage or describe a scheduled vote. Their next stated step is to urge federal agencies and Congress to follow the resolution’s proposed approach.
Related reporting has examined how technology companies seek capital in financial markets, including capital needs in technology. Other coverage looks at fintech investment concentration and private debt markets.
Read the lawmakers’ resolution announcement for the sponsors’ full account of the proposal.
