The Federal Reserve Can’t Boost The Economy, But Microsoft Can

BusinessPolicyThe Federal Reserve Can’t Boost The Economy, But Microsoft CanByJohn Tamny,Contributor.Follow AuthorMay 14, 2026, 12:00pm EDTSAN FRANCISCO, CALIFORNIA - NOVEMBER 06: Microsoft CEO Satya Nadella (R) speaks as OpenAI CEO Sam Altman (L) looks on during the OpenAI DevDay event on November 06, 2023 in San Francisco, California. Altman delivered the keynote address at the first ever Open AI DevDay conference. (Photo by Justin Sullivan/Getty Images)Getty ImagesMicrosoft invested $1 billion in formerly fledgling OpenAI when “no one else was willing” to. That’s how CEO Satya Nadella described its 2019 capital committment. Better yet, Microsoft didn’t stop there. In addition to funds, Microsoft provided OpenAI with crucial access to its data centers on which to build and train its AI models. It’s a beautiful story that economists and policymakers would do well to internalize. To see why, contemplate what’s on the mind of economists as they divine ways to enhance economic growth. They invariably look to the Federal Reserve, a size employer of economists. Their minds are wandering. And not in a fruitful direction. What powers growth is intrepid investment, and the latter is something the U.S. central bank cannot facilitate. Which brings us back to Microsoft. Implied in its initial $1 billion investment in OpenAI at a time when “no one else was willing to” is that Nadella and other Microsoft executives were well aware that they could lose every cent of their billion dollar investment. Which is the crucial point. Microsoft had $1 billion to lose. It’s what policymakers would do well to internalize. The biggest driver of the biggest economics leaps is surprise. Thank goodness then, for Microsoft, Nvidia, Amazon, Google, Elon Musk, Sam Altman, and countless other corporations and individuals possessing the kind of wealth they’re capable of losing. It recalls what excites venture capitalist Vinod Khosla. He likes impossible ideas. Yes, the ones so outlandish as to almo...