The federal government has become Intel’s largest shareholder, taking a 10% stake in the company—something that has sparked significant criticism from traditional conservatives who typically back President Trump.
Trump has touted this move, suggesting that it’s a significant development with more similar actions potentially on the horizon. But, wait—how is this not just a form of socialism?
If we consider that socialism involves government seizing production for societal benefit, it’s a point worth pondering. Imagine if Barack Obama had done something like this; the reactions would have been drastic, maybe even labeling him a communist.
After all, he once took control of Chrysler and GM to prevent their collapse, which was framed as a necessary intervention at the time.
Intel might just be the tip of the iceberg, as Trump himself expressed wishes for more instances like this, though I can’t help but wonder about the implications.
Historically, Republicans have pushed against government intervention in the market. But perhaps this—Trump’s version—represents a new industrial policy. If financially strapped companies want to sell, it could lead to the U.S.’s stake in Intel rising to 15%.
Some, like Trump’s former economic advisor Larry Kudlow, have expressed discomfort with this approach, stating on his Fox Business show that it’s troubling. Others joined him, including Steve Moore, who pointed out that the government shouldn’t enter the chip business.
Senator Tom Tillis echoed these sentiments, feeling that any government stake, regardless of the amount, starts to feel dangerously close to state ownership, reminiscent of the Soviet Union, while Rand Paul questioned if this actually moves the government closer to socialism.
Interestingly, Bernie Sanders seems to be enjoying all this. Trump’s counter? He implies that critics are being “silly” and insists he’s working for America’s benefit while profiting the country significantly.
During a recent statement, Trump claimed credit for a $10 billion boost for the nation’s economy.
Commerce Secretary Howard Lutnick later defended Trump’s Intel stake during an interview, asserting that it’s not socialism—it’s a savvy business move.
Intel has issued warnings in SEC filings, informing investors that this could lead to future grants and regulatory obligations impacting global sales. Meanwhile, Trump had previously asked for Intel CEO Lip Butane’s resignation due to past associations with China, only to change his tone after meeting Tan, calling him “very good.”
Trump’s Intel deal has ignited chatter, especially with the potential for $9 billion in grants under Biden’s Bipartisan Chips Act, raising eyebrows about the future need for government support of Intel.
I mean, it raises a critical question: if a struggling company does well, that’s beneficial for the U.S. But if it falters, the risk is significant.
Since Trump’s announcement, Intel’s stock has risen by 4%, although it’s still down 50% since early 2024 and plans to cut 15% of its workforce are in the works.
Ultimately, Trump argues that his stake doesn’t give the government control over Intel’s decisions, but come on—when the President holds such a big share, how much sway does he actually have?
With promises of more deals like this, it’s clear Trump is reshaping the government’s role alongside business—whatever label you care to apply.
